LivingSocial Is Giving Groupon a Run for Its Money, Thanks to Amazon
Before last week, LivingSocial had one-tenth of the web traffic of Groupon. Thanks to Google’s $6 billion offer and Groupon’s subsequent rejection of that offer, the deal-a-day service has been experiencing a new wave of growth. The second largest competitor in the space, LivingSocial, experienced an uptick in traffic as well, but nothing as dramatic as Groupon’s rise.
New data from Hitwise Intelligence shows that last week was a major inflection point for LivingSocial, though. It garnered 0.018% of all U.S. visits on the web, an 80% increase from 0.010%. Groupon, on the other hand, actually dropped by 20% to 0.035% market share of U.S. visits.
Why the sudden spike in traffic? The answer’s simple: Amazon. The e-commerce giant made a strategic investment of $175 million in LivingSocial last month to counteract a potential Google-Groupon combination. Last week, LivingSocial offered 50% off of Amazon.com, which resulted in more than 1 million Amazon vouchers sold. It was the biggest group-buying deal in history.”