LivingSocial Acquires Over 1 Million Customers in 12 Hours

Important: The title must really read 20 not 12 hours. See details in this comment by a LivingSocial affiliate, and the one right under it.

How many of you have heard of LivingSocial before today? We all know Groupon, but “Living” Who? Well, they’re Groupon’s direct competitor, and they have just done something that will likely make it into textbooks.

In case haven’t heard of it yet, LivingSocial is currently running an amazing $20-Amazon-gift-card-for-$10 deal, and in just a little more than 12 20 hours they have crossed the 1 million sales mark (highlighting below mine):

LivingSocial Amazon gift card deal

Also, if you decided to market the deal yourself, and referred 3 customers, you could even get your card for free (there’s an affiliate marketing element for you!):

LivingSocial referral program

Amazing, isn’t it?

I say: “smart”! LivingSocial acquired over 1 million of customers in just 12 20 hours, and I wouldn’t be surprised if this number doubles by the end of the promo. Tweets, Facebook wall posts, blog and forum entries about the Amazon gift card deal are all around the place. The idea is 100% viral, and unlike some other deal-of-the-day websites LivingSocial doesn’t have a cap on how many discounted cards to sell. They just keep accepting all orders. At one point today I could count as many as 2,000 orders per minute.

Owen Thomas of has some thoughts on LivingSocial’s possible strategy and the role Amazon (one of the company’s investors, by the way) plays in it:

LivingSocial … desperately needs to add customers to catch up with Groupon.

I’d bet that one way or another, Amazon and LivingSocial are splitting the cost. LivingSocial gets new customers. And gets something potentially more valuable: When those customers come to to redeem their certificates, Amazon will be able to track what they buy and potentially correlate that with future LivingSocial purchases.

…A gift certificate is valuable. But data? That’s golden. And that’s what I suspect was really after when it first plunked money into LivingSocial.

Very interesting train of thought (about tracking future buyer behavior while redeeming these gift cards, and steering the future sales at LivingSocial accordingly).

Either way, this was one exemplary marketing campaign — on a whole range of fronts. Kudos to LivingSocial!

6 thoughts on “LivingSocial Acquires Over 1 Million Customers in 12 Hours”

    1. Ratna, thank you for chiming in. I went off what I read at TechCrunch here, but I now see (in comments under that post of theirs) that other people are also confirming the information you have. So 12 hours should really be corrected to 20 hours. I won’t edit the post title (as it’ll then entail editing the URL to which many already link), but will add a visible note. Thanks again for your valuable and important comment!

  1. I just noticed (as pointed out here) that the LivingSocial page says “ is not a sponsor of this promotion.” So I guess this marketing exercise is being funded mostly from LivingSocial themselves. They’re an gift card reseller, so they probably get them at a discount anyway. If it’s costing them $10 per new customer, that’s actually a pretty low cost of acquisition for what is at stake!

    Interestingly, just this morning I got an email from Groupon saying “It’s been a while since you bought your last Groupon” and offering a $5 discount on my next Groupon purchase. Looks like they’ve got some money to throw around to retain customers, too.

  2. Good catch, and other observations, Rehan. With this kind of money being available (both for customer acquisition and for customer retention) I wonder why we’re not seeing this happen more often. The above-quoted LivingSocial’s campaign is the first one of this magnitude that I have personally witnessed.

    By the way, over the past 2.5 hours they’ve sold 150k+ more cards. That’s about 60k/hour. Unless sales speed up, they may not reach the 2 million that I was hoping to see.

  3. As a follow up, I bought it and they still haven’t sent me the email with redemption instructions. I saw on Twitter earlier that they were still processing emails… so I hope they have the support staff to back up any potential problems a campaign of this size might cause!

    1. I was waiting for someone to raise this up. I bought one too, and am yet to hear from them. Just checked, and my online interface with LivingSocial says “1 pending purchase”.

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