What Will Local Deals’ Second Act Look Like ?

Gearing up for our Deals 3D conference in July, my StreetFight column this month looks at some of the recent developments in the collision of local deals and mobile, otherwise known loosely as flash deals.

As we’ve written, these independently exploding areas haven’t really come together to the extent that they can and will. Foursquare’s distribution deal with Groupon uncovered today (after the column posted), is one example.

We’ll see lots more, and the discussion will continue on stage at Deals 3D. In the meantime, read the excerpt below and the entire column here.

In the tech and media worlds, it’s no secret that local deals and mobile are exploding both in terms of revenue growth as well as in the attention and investment being lavished upon them. Surprisingly, though, the two elements haven’t yet come together to the degree that they probably should.

It�s clear that mobile content is an opportune area for entrepreneurs, given smartphone penetration and escalating competition amongst providers. The daily deals opportunity, meanwhile, only needs to look at the revenue growth at Groupon, which has been the most rapid of any company in history.

But Groupon�s success has mostly come via desktop, with distribution grounded in good old email marketing and redemption cycles that can last weeks. The next natural step is to integrate mobile’s location awareness and buying intent to push deals that can be redeemed in minutes. This expands the addressable market by reaching incremental user, (or perhaps the same users at incremental touch points).

Equally important, however, is seizing the opportunity to reach incremental merchants or advertisers. While Groupon has thrived with the nail salon and skydiving purveyors of the world, there are countless other brick-and-mortar businesses with dynamic inventory levels that beg for dynamic traffic levels (of the footstep variety). Think happy hours, movie tickets or clearance sales.

A handful of players in the deal space are already building mobile apps like Dealmap. Most notable, not surprisingly, is the recently released Groupon Now app. Meanwhile, others like Loopt have partnered to distribute Groupon deal alerts to their users.

Foursquare has also begun to go down this road with version 3.0 of its app, launched in March. It includes a templated set of deal types to make it easier for merchants to manage. Some of these are decidedly time sensitive such as  flash and  swarm specials.

Read the rest…

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