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Daily Deals: Groupon Down, LivingSocial Up, Facebook Out

The daily deals space is getting quite interesting, and is one that local businesses ought to pay attention to.

For one, Facebook announced that it is shutting down its Deals service after four months. They are, however, keeping check-in deals, after changing the way Facebook Places works.

The company said in a statement, “After testing Deals for four months, we’ve decided to end our Deals product in the coming weeks. We think there is a lot of power in a social approach to driving people into local businesses. We remain committed to building products to help local businesses connect with people, like Ads, Pages, Sponsored Stories, and Check-in Deals. We’ve learned a lot from our test and we’ll continue to evaluate how to best serve local businesses.”

What’s really interesting is that Groupon traffic has declined by nearly 50% this Summer, according to Experian Hitwise. Meanwhile, LivingSocial traffic has increased by 27%.

“So why is there a narrowing of the gap between the two market leaders in group coupons? Perhaps it is simply a case of increased number of competitors and deal fatigue among consumers or simply not enough of the right deals. PriceGrabber released results from its Local Deals Survey in June, stating that 44% of respondents said they use or search daily deal Websites. However, 52% expressed feeling overwhelmed by the number of bargain-boasting emails they receive on a daily basis,” says General Manager of Global Research at Hitwise.

“While consumer fatigue may be one factor another key consideration for these sites is to focus on the attracting new and preferred audience segments via the inbox,” he says. “Currently the audience segments for both Groupon and Living Social are very similar so it will be interesting to see how both sites and category perform heading into the holiday season.”

About the Author:
Chris is a content coordinator and staff writer for SmallBusinessNewz and the iEntry Network. Subscribe to SmallBusinessNewz RSS Feeds.

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