Decide whether to partner with Groupon
Overview
This question evaluates a data scientist's skills in business decision-making, unit-economics analysis, pricing strategy, and strategic leadership by requiring explicit numeric thresholds, risk identification, and an executive recommendation for partnering with a third-party voucher marketplace.
Capital One
Oct 13, 2025, 9:49 PM
Data Scientist
Technical Screen
Behavioral & Leadership
0
0
Decision: Partner with Groupon (Restaurant Unit Economics)
Context
You are the restaurant owner evaluating a Groupon partnership. The offer structure and costs are:
- Voucher: 15
- Groupon commission: 40% of the 6; restaurant receives $9)
- Variable cost (VC): 40% of all customer spend
- Fixed cost (FC): $100 per day
- Redemption: One voucher per table
Task
Make a go/no-go decision and justify it.
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State explicit decision criteria and numeric thresholds, including:
- Minimum average spend by coupon tables (beyond the $30 voucher value)
- Maximum coupon mix % (share of tables/covers), and daypart restrictions
- Required uplift in non-coupon traffic or LTV/return behavior
- Identify top risks and specific mitigation tactics (e.g., capacity constraints, cannibalization of full-price tables, brand dilution, operational strain; and tactics like minimum spend requirements, daypart restrictions, limited quantities, upsell bundles, renegotiated commission).
- Draft a brief, executive-ready recommendation: your decision, the key assumptions that must hold, and contingency triggers that would pause or scale the program.
Solution
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