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Are Daily Deals Dead?

November 14, 2013

As fewer and fewer consumers bother to open emails pitching daily deals, and fewer still actually bite on the offers, daily-deal giants Groupon and LivingSocial are looking for other ways to snag sales.

As reports, Groupon posted wider-than-expected losses in the third quarter. One reason for the company’s struggles is a change made by Google’s Gmail last summer, in which marketing offers are now segregated in a “Promotions” folder, rather than appearing in the user’s main inbox. As a result, people with Gmail accounts have been less likely to open, let alone book, those daily offers.

But even before the Gmail change, the daily-deal model appeared to be fading  as the novelty wore off and interest waned among consumers and small businesses. Groupon, the company that brought daily deals to the mainstream, now plans on broadening its sales strategies to include deals that are available to anyone who visits its website and can be purchased for more than one day.

LivingSocial is also trying to shift focus to a website and mobile app where shoppers can browse for deals from local merchants. As reports, it’s unclear why deals from LivingSocial or Groupon would be any more appealing to consumers than those from countless other deal sites. — Greg Beaubien


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