Is it Daily Deals, or Local Commerce?

    April 5, 2011

“What’s the deal of the day?” is a question that is starting to become the norm in social circles. Although Groupon has been labeled the leader in the field, new data from Yipit shows that Groupon was down in both February and March. The data also shows that LivingSocial is up 59 percent in revenues for the top 20 markets.

Is LivingSocial on its way to becoming the daily deals leader? Let us know what you think.

While the competition has been tight between Groupon and LivingSocial, what could have given LivingSocial the extra momentum recently? According to Aaron Batalion, the company’s co-founder and CTO, LivingSocial is much more than a daily deals service.

“A lot of people in this space right now think it’s daily deals, and we disagree. This is about local commerce,” he said.

Batalion even said that, for LivingSocial, it wasn’t about selling the most deals. Instead, the company’s main priority is to build relationships with local businesses.

“We want to work with these merchants for a very long time,” said Batalion.

LivingSocial works with local businesses to ensure that the deals are sent according to their schedules. Batalion explained that the company views each deal as an opportunity for a merchant to show off his business to his town.

For users, LivingSocial hopes to provide new and interesting things to do in their communities. To expand on this goal, the company recently introduced a mobile product called LivingSocial Instant. These instant deals can be redeemed immediately, and as Batalion pointed out, encourages the local businesses to fight for users.

Another product that further reaches consumers is LivingSocial Escapes. This travel feature offers complete day trips, weekend getaways, and more. The “escapes” do all the planning for users by pairing activities together. These offers also last a week, as opposed to the typical 24-hour deal.

“We want to provide new ways for you to spend money in your town and near your town, and that’s what we’re working on,” said Batalion.

Interestingly, the company just announced that it raised an additional $400 million in funding.

Do these latest developments indicate that LivingSocial is headed in the right direction to lead this space into its next phase?