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LivingSocial Horning in on Groupon's Turf, Groupon's Next Moves Uncertain

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LivingSocial Horning in on Groupon's Turf, Groupon's Next Moves Uncertain

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The Groupon logo is engraved in a glass office partition in the company's international headquarters on June 10, 2011 in Chicago, Illinois. Groupon, a local e-commerce marketplace that connects merchants and consumers by offering goods and services at a discount, announced June 2 that it had filed with the Securities and Exchange Commission for a proposed initial public offering of its Class A common stock. The company, launched in Chicago in November 2008 now markets products and services in 43 countries around the world.

The tone surrounding talk about Groupon continues to get grimmer and grimmer, and that isn't likely to change unless Castle Groupon does something drastic to right its course. Its stock continues to tumble downhill -- $7.19 at press time – and shows no signs of slowing down or reversing just yet. Something extreme might make things worse, but it's clear staying the course is only yielding one result for Groupon – the downward spiral we've been seeing.

On the other hand, the scene is being set for Castle Groupon to do something more unusual to get noticed, and not in the ways we've seen, like Andrew Mason working at a sushi restaurant or posting videos of him doing yoga online or even offering deals on employees to tuck you into bed. Its bigger name competitors are starting to horn in the territory Groupon once staked out as oddball peripheries: LivingSocial, who we haven't heard from in a while, has announced that, starting Tuesday, "subscribers will be able to buy merchandise that changes weekly from… [the] online shop." Groupon Goods, Groupon's similar endeavor, hasn't really been heard from since it launched not too long ago, but this means it's one more way that Groupon isn't unique.

And if Groupon needs anything right now, it's a way to stand out.

LivingSocial CEO Tim O'Shaughnessy is doing his part to distinguish his company from Groupon. In an interview with CNBC, in which O'Shaughnessy was vague about the timing of his company's IPO, he stressed how he "wants LivingSocial to offer services that Groupon can't compete with—unique experiences that can't be replicated…The company has been investing in creating unique experiences that aren't discounted 'deals' — they're packages, like concerts (the company just signed a deal with AEG), or tickets to sporting events packaged with a car service or other extras."

Apparently, LivingSocial has never heard of Groupon Getaways or Groupon's joint venture with Live Nation – AEG's bigger brother, basically. So, if LivingSocial thinks it's distancing itself from Groupon by actually imitating Groupon, perhaps the better question is how can Groupon make itself different from people's perception of what Groupon is? Daily deals are a given, but what else can it do?

Well, on the plus side, Groupon has done so much tinkering and experimenting that anything it attempts won't seem totally out of left field. I know there's been a lot of gallows talk about Groupon's shelf life, but here's a prediction: This time next year, not only will Groupon still be around, but its business will have totally, totally changed.

Here's hoping Groupon proves us right. I also know a lot of people are rooting for Groupon's demise for some unknown reason, probably because of its chintzy business practices, but for better or worse, Groupon has put Chicago back on the startup map. Before that, what did we really have? The first thing that comes to mind is Kanye West trying to bring Fatburger to Chicago – something that never really panned out, perhaps because 'ye forgot that most Chicagoans don't really feel like dropping $10 on a burger that also provides people's entire caloric intake in a single handheld sandwich.

Point being, Groupon, as Tom Waits once put it: "Hold on, hold / You really got to hold on." Or, as Tupac put it, "Thugs keep thuggin' 'till their casket drop." 

David Wolinsky is a freelance writer and a lifelong Chicagoan. In addition to currently serving as an interviewer-writer for Adult Swim, he's also a comedy-writing instructor for Second City. He was the Chicago city editor for The Onion A.V. Club where he provided in-depth daily coverage of this city's bustling arts/entertainment scene for half a decade. When not playing video games for work he's thinking of dashing out to Chicago Diner, Pizano's, or Yummy Yummy. His first career aspirations were to be a game-show host.

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