There’s all kinds of news in the past few days about Groupon and LBS distribution. Last week Loopt announced that it was getting real-time deals via Groupon Now, which just launched in Chicago. Today there’s news that Groupon is going to do a similar distribution deal with Foursquare.
A few weeks ago LivingSocial launched (ahead of Groupon) its “instant deals” in the Washington DC area.
This “real time” presentation of daily deals content is effectively a repackaging of existing deals content. However with Groupon there is one relatively new element on the merchant side: SMBs can do deals spontaneously or schedule them for slow times. This is effectively merger of Groupon Stores and Groupon proper.
The tie in with Foursquare and Loopt adds more targeted mobile distribution. And there will be more such distribution deals. But is this the glorious dawn of “deals 2.0” or are deals starting to wear thin? Earlier today I saw two radically contradictory articles about the daily deals space:
- Foursquare, LivingSocial eye local ad dollars about how check-in and daily deal services are going to take lots of ad business from traditional local channels
- Top 10 Signs the Groupon / Daily Deals Racket Has Jumped the Shark about how the daily deal phenomenon is over
Neither article is accurate.
Deals aren’t going to dominate the local advertising market, nor have they “jumped the shark.” First local channels have in most cases adopted deals as an adjunct to their existing ad packages.
For many merchants deals will be effective customer acquisition and loyalty tools. But because of some of the many problems we’ve discussed here they aren’t going to take over local.
Consumers will continue to look for ways to save money and use deals. While there may be burnout and “deal fatigue,” people will never get tired of saving money.