Groupon Inc is facing tough competition from internet firms such as Twitter, which recently introduced a new online coupon systemGroupon Inc ( GRPN) is moving away from being an email-based “daily deals" company to more of an e-commerce platform, but this transition is not easy, as it is increasingly facing threats from established and bigger rivals. The latest threat to the company comes from Twitter Inc ( TWTR), which just introduced a new online coupon system, a new commerce tool from the company after the “Buy” button. Sign up for our free daily newsletter Groupon shares unaffected The news did not have any major impact on Groupon stock, which was down by .66% yesterday, while Twitter shares were up by almost 2%. The new tool from Twitter is undergoing tests and allows merchants to use the platform to advertise their goods and offer discounts to customers. The offers are added to the credit/debit cards of customers, which then can be used while making purchases through stores. Later it will be reflected in the card statements of the buyer. For the redemption of offers, merchants can also use their existing payment network. Twitter Group Product Manager Tarun Jain said the outstanding feature of this service is that it does not require any special training for employees, nor does it require any software or hardware to be installed. The customer process too does not change. Viability of coupon-based business model? Even though it's a good move by Twitter, the decline of Groupon does hint that online coupons may not be successful after all. Apart from Groupon, we have more example such as Foursquare and other geolocation apps which failed to attract users primarily due to privacy concerns. Integrating brick-and-mortar stores with the internet is not an easy thing, and the same feeling is shared by the principal analyst at Forrester Research, Sucharita Mulpuru. The analyst believes that the latest move from the micro-blogging platform may not catch on.