In addition to the rivalry between Groupon and Living Social there is the problem of fatigue.

Is this couponing a trend or does it truly bring value to brands? With couponing there is a population of about 30-40 percent that are really interested in the discount. Other people have signed up to experiment or for the novelty of the experience. Some people are going to jump from restaurant to restaurant or from spa to spa. These customers don't really have loyalty to a brand. They are just motivated by the next big coupon. Does this process add value for the retailers once the novelty wears off? This process also dilutes the ability of retailers to do their own promotions. In the end the coupon business that survives the war could be left without much in the way of business partners.


 
When Groupon and Living Social first started they were hailed as ways to get local and enhance internet search in a local market. It was all about the local business and providing a way for retailers to enter locally. Now that Groupon and Living Social are big and in the super bowl things seem to be changing. The things that are being touted is Living Social's deal with Amazon and Groupon doing a deal with Barnes and Nobel. IT seems like not things have gone back to the big boys. In the end are Groupon and Living Social really effective at getting to the small brands locally?


 
As larger businesses figure out the couponing strategy will the reach that Groupon and Living Social have diminish? I certainly hope not. Both brands are an enormous help to smaller local retailers.