No. 2 deals player is selling Amazon Local, which now appears in 44 markets.
Amazon Local, the e-retail giant's recently launched daily deals initiative, apparently does not count the space's no. 2 player - LivingSocial - as a true competitor.
LivingSocial, which received $175 million in funding from Amazon last December, is selling the majority of the ads for Amazon Local - a platform that's been dramatically expanded in the last seven weeks and now appears in 44 markets.
LivingSocial's national sales force of 700 reps has been the primary driver of sales growth for Amazon Local, according to a source close to the situation. Deals are not repurposed for LivingSocial offers.
For instance, today in Minneapolis, one of the newer Amazon Local markets, the LivingSocial offer is $20-for-$10 for a family-styled Mexican restaurant. Meanwhile the Amazon Local offer for Minneapolis includes the copy, "Sold by LivingSocial", while offering a $30-for-$15 voucher at a yarn store. The yarn offer does not appear in the "Nearby Deals" section that includes four other deals on the LivingSocial landing page for the city. In other words, there is no crossover marketing between LivingSocial and Amazon Local deals, even though the former is selling nearly all of the ads.
So while they are clearly partners, they are also competing for consumer dollars in the space led by Groupon. ClickZ News asked LivingSocial spokesperson Andrew Weinstein on Monday about the unusual competitive circumstance.
"From our perspective, Amazon is one of our closest strategic partners," Weinstein said. "We are pleased with the relationship and looking forward to continuing to roll out their product across the country."
Amazon Local was launched on Aug. 2 in 14 markets before recently adding 30 new ones.
"It has been a gradual rollout, and you will see that continue," an Amazon Local spokesperson told ClickZ today. "Last Thursday, we added Philly, Dallas, and Las Vegas."
Meanwhile, Google continues to shows signs that it's serious about its own three-month-old deals platform, Google Offers. The company has purchased Germany's DailyDeal for as much as $200 million, according to a German-language newspaper based in Frankfurt.
According to a report jointly published last week by academics at Rice and Cornell, Google and Amazon's growing deals initiatives could be well played. The universities surveyed almost 1,000 U.S. online users, finding that consumers who tend to purchase the most daily deals continue to enjoy them. Just 13 percent of heavy daily-deal users agreed with the statement: "I buy daily deals less often than I used to." And only 8 percent concurred with the following notion: "I have lost interest in daily deals over time."
In addition, marketing research firm BAI/Kelsey recently stated that deals will grow to $4.2 billion in 2015 from $873 million in 2010.
Join the Industry's Leading eCommerce & Direct Marketing Experts in Chicago
ClickZ Live Chicago (Nov 3-6) will deliver over 50 sessions across 4 days and 10 individual tracks, including Data-Driven Marketing, Social, Mobile, Display, Search and Email. Check out the full agenda and register by Friday, August 29 to take advantage of Super Saver Rates!
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.
IBM Social Analytics: The Science Behind Social Media Marketing
80% of internet users say they prefer to connect with brands via Facebook. 65% of social media users say they use it to learn more about brands, products and services. Learn about how to find more about customers' attitudes, preferences and buying habits from what they say on social media channels.
The Multiplier Effect of Integrating Search & Social Advertising
Latest research reveals 68% higher revenue per conversion for marketers who integrate their search & social advertising. In addition to the research results, this whitepaper also outlines 5 strategies and 15 tactics you can use to better integrate your search and social campaigns.
September 17, 2014
September 23, 2014
September 30, 2014
1:00pm ET/10:00am PT