Welcome to The Startup Foundry.

What startups can learn from a LivingSocial marketing misstep.

Published: May 18, 2011 4:16 pm

This is a guest post by Jason Lorimer. Jason is an entrepreneur @CulturaHQ, advocating on behalf of those with the ambition to do more than just entertain ideas.

Recently I was working out of one of my favorite Philadelphia coffee shops and I had the pleasure of meeting a young woman who works for the Adventures vertical of Living Social.
This venture, formerly Urban Escapes out of NYC was acquired by Living Social late last year.

This person who I very much enjoyed meeting and whose anonymity I will preserve herein, overheard me on the phone talking about an upcoming trip up to NYC to visit a client in the “Daily Deal” space. Naturally in working for Living Social, my chatter perked her ears. The conversation began with her asking me if I was running a deal with Groupon and having me explain that I work with early stage companies, some in the social commerce space. The discussion continued focused mainly on the shift towards experiences over discount vouchers and how that is being driven by two main factors:

  • Business owners are being inundated with pitches to host deals from dozens of daily deal companies each month. All of them with virtually identical offerings.
  • The widely held perception of business owners is that those who opt-in for a daily deal are simply discount hounds, never to return. I disagree but this is the perception.

I talked a bit about how I felt the industry was moving towards discount as a secondary motivator with experience as the thing that drives the opt-in. I also spoke of WAAG, a recently launched venture out of NYC that leverages this premise to connect those who wish to network themselves offline with small businesses and brands who want to host events at their locations.

My new friend was very enthused about the adventures Living Social was promoting. She made them sound like good fun. As we were talking, I ran a Google search to find the home page for Living Social Adventures. Clicking around a bit on my laptop, I could not for the life of me find a place to enter my email to be notified. Perplexed, I asked:

Where do I opt-in to get invited to the adventures?

You don’t.

Hmmm….It turns out that you have to go to the main site and opt-in to receive the daily deals in order to get the adventures invites.

I have no way of knowing what was on the minds of the executives at Living Social when they acquired Urban Escapes and re-branded it as Adventures but it would seem to me they are missing a huge opportunity to bring new people into the fold. The much larger marketplace of people open to the idea of passively participating by opting-in to receive invites to cool new social experiences but are not so keen on the idea of using a discount voucher at their local pizza shop. Now, certainly the master list of email addresses should be leveraged for Adventures but why not market it separately? Send a few timely emails to all existing users asking them if they wish to receive adventures in their area but focus on driving new membership to adventures specifically and then cross market those people into the more profitable daily deal list.

Living Social trails Groupon, their biggest competitor at almost every turn. The Adventures play  is an opportunity to stand out to the larger portion of the public and businesses, both sick of the daily deal speak. Use some of that advertising budget to really push this new, experience based vertical and take a chunk of new market share in the process.


  • 👉 Filed Under.

    Categorised in:

Get Connected:

If you like startups, join our weekly mailing list. Good startup content, no fluff.


Picture of Paul

Hi, I'm Paul Hontz.

I'm a YC alumn and I love startups. I created TSF to highlight companies I find interesting. You can learn more about me here.

Recent Posts:

How To Do B2B Email Sales

Nov 23, 2011 2:12 pm

Our Sponsors: