New research from Hitwise suggests that social-buying site LivingSocial has gotten off to a running start in 2011. A January traffic surge has helped the company close the gap with Groupon, getting more than half the share of visits of the category leader. Two months ago, Groupon had a 10-to-1 traffic advantage over Living Social, according to the Web measurement firm.
Hitwise attributed the traffic spike to LivingSocial's "door-busting" $10 for a $20 Amazon gift certificate deal this month, which brought in more than $13 million in sales. That topped the previous record of $11 million that a national Gap-Groupon offer took in last August. However, the Amazon deal was criticized as a marketing ploy -- since unlike typical deals where LivingSocial takes a 30% cut of sales, it bought the gift cards from Amazon and sold them itself.
Amazon recently invested $175 million in LivingSocial, so an increase in business for the deal site also benefits the online retail giant indirectly. The gift certificate offer led to reports of complaints about canceled orders, unauthorized charges and other issues related to the promotion.
"Despite some claims of fraud and issues with customer support, LivingSocial's 80% traffic surge last week (and Groupon's 20% decline in the same time period) proves that the race for dominance in the group coupon space is far from over," wrote Bill Tancer, general manager of global research at Hitwise, in a Jan. 27 blog post.
LivingSocial had 2 million U.S. unique visitors compared to 3.9 million for Groupon as of Jan. 16, according to the latest comScore data. But the cut-off date falls just a few days before the Jan. 19 Amazon deal, so the numbers don't show what kind of bounce LivingSocial got from the deal. However, the site's traffic had already roughly doubled from 1.1 million in mid-December.
A growing online audience is one thing, but what about any gain in registered users? LivingSocial said Friday that it had added 5 million subscribers worldwide so far in January and expects to end the month with 20 million overall. That compares to about 50 million for Groupon. Does that mean more Amazon offers are on the way from LivingSocial? "We're always exploring opportunities to offer really amazing deals locally and nationally and working hard to identify the next big deal," stated a LivingSocial spokesperson.
COMMENTARY: I had a look at the traffic data for both LivngSocial and Groupon using only Alexa.com, an online web analytics service, because QuantCast.com, a similar service, did not track either site. Here's what I found out:
TRAFFIC RANK (As of 1/31/11):
- Worldwide: Groupon #380 vs LivingSocial #529
- U.S. only: LivingSocial #73 vs Groupon #89
REACH RANK (As of 1/31/11):
- Worldwide: Groupon 0.33180 vs LivingSocial 0.27360
- U.S. only: NOT AVAILABLE
LivingSocial is definitely giving Groupon a run for its money. The partnership with Amazon.com definitely helped super-charge its traffic and reach as evidenced by that blue peak in January 2011 The $145 million investment didn't hurt either. Although LivingSocial lags in worldwide traffic ranking, it is nearly even with Groupon in the U.S.
Other comparisons between Groupon and LivingSocial:
- Linking With Sites: Groupon has done a much better job linking with other sites (3,513 versus 897) than LivingSocial.
- Loading Speeds: LivingSocial's site loads nearly three times faster than Groupon (1.2 seconds versus 3.53 seconds).
- Worldwide Audience: LivingSocial leads Groupon in the U.K. and Argentina, and lags slightly behind in Canada. Groupon leads in LivingSocial in Canada, Australia and India.
- Source of Traffic: LivingSocial's leads Groupon in U.S. traffic 86.7% versus 76.6%.
- Groupon's audience tends to be Caucasian; they are also disproportionately childless women and college graduates earning over $60,000 who browse from work. The fraction of visits to Groupon.com referred by search engines is roughly 10%.
- LivingSocial users are disproportionately Caucasian, and they are disproportionately moderately educated, childless women earning over $30,000 who browse from work. About 69% of visits to Livingsocial.com are bounces (one pageview only). The site's visitors view 2.0 unique pages each day on average.
Courtesy of an article dated January 28, 2011 appearing in MediaPost Publicaons Online Media Daily