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Groupon Purchases Pelago, As Whrrl Dissipates

  |  April 18, 2011   |  Comments

Daily deals company appears primed to become more geo-social.

Groupon has purchased Pelago, makers of the location-based service Whrrl, in the latest sign that daily deals and geo-social are converging marketing niches. Andrew Mason, Groupon CEO, announced the move in a blog post today while praising Whrrl's "Societies" and check-ins platform.

"Their obsession with real-world serendipitous discovery, or Anti-Search, is core to Groupon's mission," Mason wrote. "It's about discovering what you didn't know you didn't know, right in your own backyard."

Chicago-based Groupon appears to be making a technology-and-talent purchase. Whrrl will no longer exist after April 30, as Pelago CEO Jeff Holden will oversee Groupon's product development. Other Pelago employees will also work with Mason's "Grouponnovations" team, he wrote.

Groupon's mobile app already has a location-based "Groupon Now" feature, which offers a pair of choices on a user's smartphone: "I'm hungry" and "I'm bored." When a user selects one, they see numerous choices based on the time of day and their location.

whrrl-logoIt seems logical that Pelago's Holden will lobby to add some of Whrrl's slicker elements to Groupon Now. And Mason's prepared comments seem to hint toward that possibility.

For the last 10 months, Whrrl has offered so-called societies to brand partners. These groups have been essentially location-based versions of "likers" or followers that are seen in other social media realms like Facebook and Twitter. The societies have been tied together by specific interests while individually sharing recommendations on activities. Red Bull was the first to launch a branded society last June, and Murphy's USA has successfully used the platform since then.

Terms of the deal were not disclosed. A Pelago spokesperson said the company had around 25 employees. Groupon employs approximately 3,000 worldwide, including 1,000 at its Chicago headquarters.

Pelago has never disclosed how many users Whrrl signed up, but reaching critical mass has no doubt been a challenge for the company. And with Whrrl folding up shop as a geo-social app, industry observers will likely turn their attention to other small players like Loopt and Gowalla to speculate on whether they can attract enough users.

LivingSocial's $1 Lunch Offers Tallies 27,000 Purchases

Meanwhile, Groupon's chief competitor, LivingSocial, on Friday seems to have demonstrated the potential power of combining geo-social and daily deals. The company has told ClickZ its "$1 Lunches" campaign in Washington, D.C. garnered 27,000 purchased vouchers in three hours.

LivingSocial was attempting to make a big splash with its month-old "Instant Deals" feature for its mobile app. The GPS-enabled app creates a list of deals within a half-mile of the user.


Christopher Heine

Christopher Heine was a senior writer for ClickZ through June 2012. He covered social media, sports/entertainment marketing, retail, and more. Heine's work has also appeared via Mashable, Brandweek, DM News, MarketingSherpa, and other tech- and ad-centric publications. USA Today, Bloomberg Radio, and The Los Angeles Times have cited him as an expert journalist.

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