Groupon

Groupon Buys Restaurant Reservation Site Savored

The knock on Groupon is that it brings traffic but not profits, eventually driving businesses out of business even as it makes them busier. It’s hard not to argue with that interpretation when you look at Groupon’s newest acquisition— Savored, a restaurant reservation known until about a year ago as VillageVines.com. Neither name is very clear at explaining Savored’s business model, which is same-day restaurant reservations at a 40% discount. In other words, like Priceline does with hotels or airplane seats, it sells them off at the last minute on the theory that some revenue is better than none. The difference is that where filling that excess capacity costs the hotel or airline almost nothing extra, the discounted restaurant meals do consume supplies and also may cannibalize same day reservations which would have paid full price. In any case, Savored, which has been in Chicago but has been very low profile, will surely now have a bigger chance to show if it helps or hurts the industry. [Crain’s]

Groupon Buys Restaurant Reservation Site Savored