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LivingSocial Using Adware to Pass Groupon?

Written on
Jan 24, 2011 
Author
Gavin Dunaway  |

livingsocialADOTAS – As the media was lost in the hoopla surrounding the launch of Google Offers, fraud hound and former Adotas publisher Pace Lattin discovered via Alexa that discount site LivingSocial actually jumped in front of chief rival Groupon this month in terms of daily traffic.

In particular, there was a huge spike as LivingSocial offered a $20 Amazon discount card for half price. LivingSocial has been getting a lot attention since a $175 million cash injection by Amazon.

But Lattin did a little more digging and was surprised to find that 7% of LivingSocial’s traffic came from… Groupon? Its biggest competitor? OK, that’s a little weird, but maybe thrifty consumers were jumping from one discount site to the next, looking for the best deal of the day. However, Lattin smells the use of adware:

“I confirmed with several affiliate networks that run [LivingSocial CPA campaigns] and they told me that some of their biggest affiliates indeed are using contextual adware to promote LivingSocial, including TrafficVance, an opt-in adware system. Whether or not you agree with adware, is one question –- but the legality of popping a competitive site has been found in the courts to be an issue.”

Oooh, do we have a brewing legal showdown between Goliath (Groupon) and David (LivingSocial)? Stay tuned…





Gavin Dunaway is Editor, U.S. at AdMonsters, a leading trade publication, event producer and service provider for the online advertising industry. Previously, he had been Senior Editor of Adotas, where he arrived after years of ping-ponging around various industry publications. This Washington, D.C. native and George Mason University graduate also enjoys playing electric guitar so loud that the walls shake.

Reader Comments.

I check http://grouponbot.com more often then I check groupon now.

Posted by Peter Couch | 2:30 pm on January 24, 2011.

LivingSocial is certainly gaining more fame, especially after their last deal involving half off Amazon gift cards. It isn’t surprising to see them growing like Groupon.

If you are a consumer looking to save, try http://www.dailydealpool.com. They’ll send you a daily email with the best local discounts, ensuring you won’t miss out on a great deal in your area.

Posted by Nora | 3:30 pm on January 24, 2011.

Great find. Knowing the tech culture of Living Social I don’t find it suprising they are using Adware. While it’s still a “grey” area LS tends to take a no-holds barred approach to this space.

However, I don’t consider Living Social vs Groupon a “David vs Goliath” matchup, its more like Goliath vs Goliath. TroopZilla vs. Groupon in their own backyard, is much more of your classic “David vs Goliath” matchup..

Posted by TroopZilla | 6:03 pm on January 24, 2011.

As a LIVINGSOCIAL employee…I totally agree with @TroopZilla for getting the tech culture right. We have incredibly intelligent “techies” who solve problems and streamline operations that thrives a sales force. I am proud of our accomplishments in the last year and yes @TroopZilla, it would be a Goliath vs. Goliath. LS just passed Groupon in web traffic and its latest $200M investment from Amazon, LS is now valued at over a billion dollars. Lastly, our company is very ethical and I feel an intentional sensitivity to ethics and values here. I sincerely believe the potential LivingSocial posses has been underestimated. We are going to surprise lots of people, stay tuned…

Posted by Aaron Lujan | 5:23 am on January 31, 2011.

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