Is the Groupon Economy Big Enough for Side Businesses?


Addicted to Groupon, LivingSocial, YouSwoop and TownHog (and the many other Groupon groupies), where the appeal of an amazing expiring deal snags you — but then you get busy and forget to ever print or use the coupon you bought? It happens to all too many of us. But now there’s a site — DealsGoRound — where you can buy and sell daily deals rather than let them go to waste.

DealsGoRound is a side project of Chicago entrepreneur Kris Petersen, and since beta-launching in 52 cities on March 1 has hosted just 30 transactions. Petersen tells us that he came up with the idea after letting a $160 pair of Segway tours of downtown Chicago expire because he was too busy with work and training for a marathon. “I realized my impulses didn’t always coexist with my calendar,” he said. The site doesn’t verify deals but it doesn’t take a cut of them, either; Petersen wants to monetize through advertising.

DealsGoRound bears a parallel to sites like Cardpool (our profile) and Plastic Jungle, which have emerged recently to buy and sell unused purchases in the $100 billion gift card market. Though interest (and venture funding) in Groupon-type businesses is exploding, it’s not there yet.

But other sites like 8coupons and Yipit have launched side services for daily deals too — aggregating and repackaging them on a map or an email, respectively. In a sense, these sites help grow the Groupon economy in that they increase distribution for deals, which are ultimately monetized by the companies that set them up when people purchase them.

Yipit, for example, sends a very nicely formatted email newsletter of all the deals in your local area, giving top billing to the ones in categories you’ve indicated you like. It’s the kind of thing that makes you unsubscribe from Groupon, losing their tight connection with you and their quantifiable recurring email recipient. After all, being a deal seeker isn’t about brand loyalty; it’s about finding the absolute best and most relevant deal as quickly as possible!

But these are young and evolving concepts. The folks at Yipit told me they’re trying to put together a local advertising network to sell highly targeted deals ads on local blogs and news outlets. As far as new businesses go, that certainly seems like a better and more scalable idea than creating yet another Groupon groupie with its own local ad sales team in every city.



Great article and i hope to see sites like this which will locally come with cities. I mean in each state, able to state the major cities or even carrying more than one deals a day.


Thanks for the article Liz! Yes, these deal-a-day site is exploding and although I like the concept of DealsGoRound I am not sure if the consumer market is quite there yet…

One of the reasons Groupon exploded is because of its simplicity. One deal, every day, simply presented with a great presentation.

We launched Daily Flock ( in NYC as an aggregator as well…and its taking off because we are trying out retain the simplicity of what Groupon originally laid out…while ALSO providing our own unique deal of the day.

For the deals that we negotiate (we call ‘The Flock of the Day’) we actually go out and do a professional video shoot for the business running the promotion.

This is valuable because the CONSUMER is who is most important in this model…they want the BEST deals, from the BEST places in the most SIMPLIFIED daily alert they can receive.

We are also giving away, for free, one of the daily deals on our Facebook fan page…and running contests where we give stuff (money, hehe) away to our followers…

Def check out our site and we are loving what we are seeing in the space! Thanks for writing such a wonderful article!

Sanjay Maharaj

I think to scale this really fast, there needs to be some location based service through a smartphone where the delas are shown when you are within say 2 block radius of the deal. Impulse buying will then take over and possibly push this thing to really scale and blow out, What do you think?


But in that model you are assuming that there are more than one deal going at a time. People have told you thier relevant location (city) and now you push them the offer.

If there is only one deal a day then it doesn’t matter whether I am near it in real time via my mobile device unless I have bought a large group of deals and need to be pushed to actualy use the stuff I bought. In that case the dealer and Groupon already have my cash so why would they care other than long term happiness, me not using the deal is more akin to an unclaimed rebate.


This is a modern version of a Tupperware party hosted by a stranger. Group buying behavior and coupon clipping have been around for a long time but the infrastructure is changing.

Now that I don’t read a Sunday newspaper how do I find out about my local deals? Groupon sites are one version of this but they are not efficient yet so side markets will flare up until it becomes an efficient system.

Liz Gannes

Totally. Though personally I’ve never been to a Tupperware party. I like the efficiencies created by pushing a flood of demand to a business that has high overhead costs like a local retailer. It means we buyers can get deals that are a heck of a lot better than your standard 10% off. Let’s just hope Groupon et al can keep the merchants happy.


Liz – Chicago has quickly become the hot new market for start-up companies in the local space, inviting others in a land grab for a piece of the local consumer. At we are currently indexing and categorizing over 200 offers from 70 websites across 50 cities in the US, Canada and UK. In Chicago we are following 13 of these ‘deal-a-day’ websites and visitors may subscribe to a single daily email digest containing all the available offers for the day.

Liz Gannes

True enough. Do you use Groupon though? When I heard of Yipit I was like…c’mon really…a Groupon aggregator?! But now I get the Yipit emails every day and I find them really useful. And in a larger sense these companies change the economics of local spending in a really cool and empowering way for customers and merchants.

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