Categories: OLD Media Moves

Groupon coverage misses the mark

Marek Fuchs, the business media critic at TheStreet.com, writes that coverage of Groupon’s earnings on Monday missed the key point that its business growth is slowing.

Fuchs writes, “The Associated Press flailed about without touching upon the essential reason. It said that the weak European economy led less people to rush for services like ‘laser hair removal.’

“It also mentioned the cost of paying executives with stock and of acquiring customers, a Chinese joint venture and currency exchange rates, as well as a light forecast for the current quarter.

“In a quick-hit piece after the earnings release, Business Insider was almost comically mystified, saying: ‘Despite numbers that look okay on the surface, something problematic must be lurking below.’

“Uh, OK.

“But in a follow-up article, Business Insider offered up a concise explanation: Groupon’s core business is shrinking — and how — while growth is coming from a new division that features suspect accounting.

“It wrote this about the new division, called ‘Goods,’ which sells physical items: ‘Groupon recognizes revenue differently than in its core business. With some ‘Goods’ sales, Groupon is recognizing the total value of the item sold, not just the value that Groupon gets to keep after it sells a coupon.'”

Read more here.

Chris Roush

Chris Roush was the dean of the School of Communications at Quinnipiac University in Hamden, Connecticut. He was previously Walter E. Hussman Sr. Distinguished Professor in business journalism at UNC-Chapel Hill. He is a former business journalist for Bloomberg News, Businessweek, The Atlanta Journal-Constitution, The Tampa Tribune and the Sarasota Herald-Tribune. He is the author of the leading business reporting textbook "Show me the Money: Writing Business and Economics Stories for Mass Communication" and "Thinking Things Over," a biography of former Wall Street Journal editor Vermont Royster.

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