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Groupon Like Daily Deal spending Could Top $6 Billion

Living Social and Groupon set for big growth

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[ Technology]

U.S. consumer spending  on daily deal sites like Groupon and LivingSocial is on track to grow from $873 million in 2010 to $3.9 billion in 2015, representing a 35 percent growth rate, according to a new report from BIA/Kelsey.

BIA/Kelsey indicates a number of variables will have an impact on the development of deal a day, such as growth in the number of cities/sites, registered users, transactions per year for the average user and the average price per transaction. Including those variables, deal a day could grow as much as $6.1 billion by 2015, while a conservative estimate is $2.1 billion.

Deal-a-Day

"Deal a day has experienced incredible growth during its three-year incubation period beginning in 2008," said Mark Fratrik, vice president, BIA/Kelsey.

"We expect this to continue as companies in the space are rapidly adding markets and increasing total user count. They are also subdividing existing metros to provide deals closer to where users live, which we believe will help offset any drop-off that may occur due to consumer fatigue as the novelty of the form fades."

While Groupon and LivingSocial are tops in a marketplace of more than 200 similar services, the broader area includes sites working with local media providers such as directory companies, newspapers and radio and television stations. BIA/Kelsey estimates there are 178 cities with deal-a-day sites reaching 102 million people in the United States.

"The combination of fun offers and convenience makes deal a day a very attractive way to reach local users, and for publishers to work with small businesses," said Peter Krasilovsky, vice president and program director, Marketplaces, BIA/Kelsey.

"We expect to see some shift in local media spending resulting from the adoption of deal a day by local advertisers. We also believe that deal a day doesn’t exist in a vacuum. It will become a part of the growing deals and offers landscape."

 

Groupon Like Daily Deal spending Could Top $6 Billion
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  • http://www.dailydealpool.com Nora

    Daily deals and group buying are both huge right now, and they continue to grow. I could see the spending going very high in the near future.

    A great site for consumers to find the best deals and sales in their area is http://www.dailydealpool.com. This site will email you daily with a list of the best buys, ensuring you don’t miss out on a great local or online deal.

  • http://www.brickmarketing.com/website-internet-marketing.htm Nick Stamoulis

    It really is astounding just how fast Groupon grew. They found a way to tap into a consumer’s desire to feel like they are outsmarting companies by getting an amazing deal. The limited time offer (24 hours) also pushes users to make a decision right then, so they don’t have time to hem and haw.

  • Charles

    There’s a new one coming out soon. It has some good differences and lots of potential. It’s in pre-launch right. It launched back in December and the website is getting tons of hits out of nowhere.

    It’s the same thing as Groupon except when someone signs up through your referral link, if they or anyone they sign up ever buys a coupon from this site (which you get in a daily e-mail), you earn 5% commission of the coupon purchase price! You earn 5% commission up to 5 levels deep.

    Also, if you sign up a business and they ever offer a coupon, you get 2% of all of their coupon sales. Needless to say, I’m pretty excited about it!

    100% free.

    There are no coupons yet since the company is in pre-launch. They’re suppose to be launching this month.

    Check it out:

    http://othergroupon.thecustomeradvantage.com/

  • http://todaysdealsblog.com/ daily deals

    This is the perfect concept but I do worry how long this trend will last. It’s great to combine coupons, savings and socializing all in one and no one does it better than Groupon.

  • http://dailydealbuilder.com Hollis Carter

    This has become a phenomenon on online revenues.

    I don’t see this slowing down at all with so many different markets and locations still to be tapped. A truly win win win business model.

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