What's so hot about Groupon?

Ok. I really don't get it. Why is everybody talking about groupon? Even news of Google attempting to buy them, and what surprises me the most: them apparently saying no to -in my opinion- a very generous offer, are all over kingdom come!

What's so hot about the whole economies of scale concept? It's not even a secret! (I believe this is what Costco, BJ's and Sams Club are all about, not?) Their motto is "Collective buying power". Is there anyone out there surprised by the whole idea of let's make a larger pool of people so we increase our bargaining power and we can all be better off?

I'm surprised to hear that Google allegedly offered various billions of dollars to buy this "invention". I'm even more surprised to see Groupon rejecting it! I suppose there’s got to be  more to this. What is it? Well, that people actually like the concept! And many are frequently visiting the site and benefiting from the deals they offer.

I mean, if you look at it in detail, it's indeed a good idea to encourage a group of people to come together and send them to some customer craving business of their choice willing to trade some of their profit for the additional flow of customers. Of course, the promoter gets a cut, and here is where Groupon comes into play.

Just to say it briefly, this is how sometimes marketing works. There are things that seem logical to work... but don't and there is indeed the opposite thing too. This one is working (at least for now!)

The problem I see is with the viability of the entire concept in the long run. This is an extremely easy to emulate model, and as one could imagine, various companies are already working copying it, improving it and expanding it. All Internet-based business models are exposed and vulnerable to this kind of "competition". Groupon, and their obvious business model is no exception to this rule. I only hope they had a really good reason to pass on Google’s offer.