Google rolls out rival to Groupon in Portland, Ore.

Search giant kicks off Google Offers today in the City of Roses, with plans to expand the daily-deals service to San Francisco and New York next.

Anne Dujmovic Senior Editor / News
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Floyd's Coffee Shop in Portland, Ore., is the first business to be featured on Google Offers, a new daily-deals service. Anne Dujmovic/CNET

PORTLAND, Ore.--Google Offers launched its answer to Groupon today exclusively in Portland, Ore., with its first deal for--you guessed it--a coffee shop. Perhaps owing to the highly caffeinated culture here, some people who snapped up the "Offer of the Day" raced over to Floyd's Coffee Shop only to discover that the coupon can't be redeemed until tomorrow.

"Within 10 minutes of the deal going live, someone was in the shop to redeem the offer," Jack Inglis, co-owner of Floyd's, said in a phone interview.

On the cash register at Floyd's in southeast Portland, a sticky note spelled it out for the daily-deals crowd eager to cash in: "Google Offer Starts TMR!"

Before noon, more than half of the 2,000 coupons had been purchased, with the window to purchase the deal expiring at midnight tonight. The deal--$3 for $10 worth of drinks and food--is good for a year at either of the two Floyd's locations.

A sticky note spells it out for the daily-deals crowd. Anne Dujmovic/CNET

Google Offers beta is a daily-deals service much like Groupon, LivingSocial, and others. Users who sign up will get daily-deal announcements via e-mail. A Google representative said today that the company will offer one deal each weekday and one deal every weekend. Upcoming offers will feature the venerable Powell's Books and the arcade Ground Kontrol.

Google chose Portland as the launch site because it "has a large number of local businesses and an active community," the representative said. The San Francisco Bay Area and New York are next on the list for Google Offers, though the company said it isn't announcing future dates yet.

Late last year, Google reportedly tried to buy Groupon, the leader in the daily-deals market, for between $5 billion and $6 billion, but Groupon decided to remain independent. Google confirmed about a month later that it was putting together its own daily-deals service.

"Google has a reach very few other companies can claim," Inglis said, explaining why Google Offers appealed to him. He and his wife, Cris Chapman, started Floyd's about seven years ago. It's a small but growing business and they don't advertise. "Getting our name out there as a brand is my long-term goal," Inglis said.

He said Google asked that they not disclose the terms of their agreement, but he said the terms are competitive with those of similar services.

The one hitch today with the inaugural "Offer of the Day" seemed to be timing. People are misreading the offer, thinking it needs to be redeemed today, Inglis said. In fact, the soonest it can be redeemed is tomorrow, though the deal is good for a year.

Before today, Inglis probably would have said it's not likely people would go out of their way to go to a particular coffee shop.

"I think I'm about to be proved wrong," he said.

Eric Vaterlaus, a computer programmer, went to Floyd's in southeast Portland for the first time today. He works about 14 blocks away and tried to redeem his Google Offers coupon at lunchtime. Vaterlaus said it was a breeze to buy the deal online but noted that the coupon only has the expiration date. He suggested that Google include the deal's start date on the coupon like it does on the Google Offers page. Even so, he said he plans to return to Floyd's to take advantage of the deal.

As a computer programmer, Vaterlaus said, he understands how things might not always be perfect at launch.