Groupon to cut 1,100 jobs worldwide

Groupon plans to cut 1,100 jobs by September 2016 as part of an effort to reorganise its business.

The company, which offers daily deals, says the cuts will come from customer service and operations staff.

It will also close operations in seven countries including Thailand, Taiwan and Morocco. It left Greece, Turkey and India earlier this year.

Groupon launched in 2008 as a website for companies to attract customers through one-off offers.

However, many businesses that used Groupon struggled to transform discount buyers into long-term clients.

Growing competition from sites like LivingSocial, and attractive deals from Amazon and eBay also cut into Groupon's business.

Groupon told US regulators it does not expect to see any significant savings from the layoffs and will take a $35m charge to cover the reorganisation.

In 2011, a study by Rice University highlighted the difficulty for small and medium-sized businesses using the Daily Deal component of Groupon. Many businesses reported losing money on those offers.

As a result businesses moved away from Groupon or created specific offers for Daily Deals that were more profitable, but less attractive to customers.

"What I have seen is the quality of the promotions are worse. They are from unknown merchants and for strange things," said Professor Utpal Dholakia, the study's author. "From my perspective customers are fatigued; [Groupon] is no longer as novel or fun as it once was."