.Like many daily deal sites, its members can purchase and redeem its voucher at the next day.However, there is one big thing that differentiates LivingSocial to other site is members can have theoption to send the link to his or her contacts and if three of them purchase the offer, the initial membercan have it for free.
StrategyOverall, LivingSocial adopts the following strategy: Product leadership according to Michael Treacyand Fred Wieserma
. They have grown a wide range of product packages to offer the most fastidiousperson with a reasonable price which other competitors do not expect from customers. Moreover, theyhave built powerful and firm business systems in many cities in US that could deliver more compared toits competitors. Its local staffs will bring more value to customers because they have localizedknowledge and relationships which will provide more sustainable competitive advantage though it isslower and expensive t
han Groupon’s telemarketing way
. In addition to that, holding 32% of sharesmakes Amazon responsible and committed to LivingSocial. A lot of money and effort have been pouredin LivingSocial which would make a win-win situation for both.
They have launched some food events to aim at high-end customers who they charge $100 to$200 to experience a new atmosphere and unforgettable moments. Moreover, the deals isonly exclusive to LivingSocial members so the limitation can be an attraction to othercustomers and a bonus reward to the existence members
The strategic partnership with Amazon is a big leap for a young start-up. They also have soldover 1 million of Amazon voucher worth $20 for only $10
. In addition, by leveraging Amazon’s
vast customer list, the acquisition cost of new customer and vendors is dramatically decreases.
In the future, Amazon‘s Kindle Fire will be sold which could be a good news for
LivingSocial.With an ultralow price which Amazon accepts to make loss, the Kindle Fire will be ablockbuster and a good advertiser for L
Mergers and Acquisition activities
Date Target Deal type Price Purpose
10/2010Urban EscapesAcquisitionn/a New product and market
11/2010 Jump On It Majority Acquisitionn/a Australian market