Groupon’s decision to cease operations in Greece may have been an expected, but the voucher site’s exit from Turkey is interesting to say the least.
The publisher recently announced its departure from both markets in a statement which outlined an intention to tread a “path of growth”.
It’s understandable that a decision to halt operations in Greece may be put down to the country’s adverse financial state – something that has yet to be confirmed. However, an interesting spin has emerged courtesy of sources close to the firm saying the decision to cut presence in Turkey was also due to financial reasons.
Turkey, in stark contrast to Greece, has been touted as an upcoming performance ad economy: perhaps unequipped for providing a realistic challenge to Britain, France or Germany, but certainly capable of standing on its own two feet.
Last year PerformanceIN looked into the Turkish market to find plenty of media agencies reporting huge growth in what was considered well-cultivated ground for performance advertising.
A tale of fortunes
Groupon doesn’t appear to be revelling in Turkey’s financial power, and a hard time in Greece could be owed to the financial restrictions currently being imposed on locals.
As of August 24, Groupon sites in Turkey and Greece have been officially closed with no re-direction available. Details are now starting to filter out regarding the reasons for doing so, which appear to be down to unrealised financial expectations.
Turkey as a country has come on leaps and bounds since enlisting on the International Monetary Fund bail-out programme in 2001. The nation’s economy grew at a rate of 8.8% in 2011 but has slowed in recent years, attributed to the lack of a government reform.
Forecasts suggest 3.5% growth for 2015 rising to 3.7% next year – a huge decline on the rates of 5-10% being seen in the late 2000s.
Greece’s financial troubles have been well documented, with cash withdrawal limits and reports of falling bank deposits adding further woe to a country which is currently operating under a temporary government.
Missing the opportunity
Neither environment would have handed Groupon an ideal place to offer discounts to web-shopping locals. Even so, Turkey’s economy continues to grow at a steady pace, backed by an increasingly connected population.
Advertisers were told to take notice of the country in its rise from the ashes and IAB Europe still named Turkey as the continent’s second fastest-growing ad market as late as last year.
Despite this, it’s conceivable that Groupon may have been pinning too much on the market to deliver in light of some of the economic readings of the previous decade, and that it came to the point where its potential would never be realised.
What’s clear is that Groupon in Turkey is no more and it will be interesting to see which other publishers and advertisers enforce similar action over the coming months.