LivingSocial Takes a Page from Groupon

It’s been about a week and a half since I reaped the benefits of LivingSocial; a website that offers daily deals on various local businesses. Sound familiar? It’s because they’re basically the same as Groupon. For ten dollars, I purchased myself a $20 gift card for Amazon.com. As easy as cutting coupons, I signed up and earned myself $10 within a couple of minutes. What did I buy you ask? That’s not the point of this post but here, I bought these.

You might remember a few months ago when Groupon exploded onto the scene by partnering with Gap to offer $50 worth of merchandise for a price of $25. A total of 441,000 were sold bringing in more than $11 million in revenue. In comparison, nearly 1.4 million Amazon.com gift cards were sold totaling $13 million in revenue! Groupon/LivingSocial usually splits the revenue between their business partners, however, the exact percentage split from these two major deals are unknown.

What the Gap deal did for Groupon, the same goes for Amazon.com and LivingSocial. Since the deal, LivingSocial’s traffic surged 80% while Groupon declined 20%. However, Groupon is still currently the leader in group buying websites. It’s going to be interesting to see how Groupon and LivingSocial will do once powerhouses Google (Google Offers) and Facebook (Facebook Deals) begin solidifying themselves in this uber-competitive group buying market.

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