Google has led several technology industry giants, including Facebook, Amazon.com and AT&T, into the daily deals sector in recent weeks to challenge Groupon and LivingSocial in the $1.25 billion deals market. ?
Although daily deals leader Groupon has seen staggering growth — Bloomberg reports it will seek an initial public offering of about $20 billion — each of these newer deals programs threatens to steal market share from the Chicago-based company because of their unique business attributes. ?
Facebook, for example, has a community of more than 500 million to whom it can make offers, while AT&T can leverage Yellow ?Pages‘ long-standing history as a small business advocate to recruit new merchants. Amazon.com, which launched flash site with deals MyHabit.com on May 3, reaches 65 million visitors each month, while Google draws more than 150 million visitors monthly. ?
“We’ve got AT&T’s unique access, reach and local search expertise,” said Dawn Benton, director of corporate communications at AT&T. “We have an advantage with those longstanding relationships.” Benton added that AT&T isn’t “new to the deals market” but that the daily deals offering “builds on what we’ve already done.” ?
Meanwhile, spokespersons from Facebook and Google said that their deals sites will help people find social experiences with their friends and engage consumers with local businesses, respectively. ?
The digital heavyweights are testing the deals programs in limited markets before taking them nationwide. Facebook is offering coupons to consumers in Atlanta, Dallas, San Diego, San Francisco and Austin, Texas, while AT&T’s daily deals, through subsidiary YP.com, can be used in Los Angeles, Atlanta and the Dallas-Fort Worth area. ?
Newcomers to the daily deals space are at a disadvantage compared to Groupon, because they do not have its thousands of employees and corporate partners, said Sucharita Mulpuru, VP and principal analyst at Forrester Research. However, she added that Facebook could use its many brand pages to boost its deals service. ?
Groupon, meanwhile, isn’t sitting on its laurels. The company partnered with Live Nation Entertainment to launch GrouponLive, an online ticketing deals channel, on May 9. The next day, it launched Groupon Now, which lets consumers enter their location on a computer or mobile device, then choose the type of deal they want to receive instantly redeemable offers from nearby merchants. ?
Julie Mossler, PR and consumer marketing manager at Groupon, said that daily deals newcomers will have to learn how to work with local merchants during the sales process to keep them satisfied. “Merchants don’t want to run a deal and not have help,” she said. “You need a huge amount of merchant managers and salespeople on your team.”
