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LivingSocial: Why Groupon’s Overlooked “Little Sister” Actually Might Be a Better Choice

Coupons are hot again. Well, actually, that’s not entirely true. Coupons are hot for the first time. You probably never got excited about finding a 25-cents-off coupon for paper towels in the Sunday newspaper–and these days, you might not even still get a Sunday newspaper.

Groupon made couponing fun, largely because it’s a very different take on couponing. The market leader in the “deal-of-the-day” options focuses on offering just a single deal every day in one of its markets. People excitedly open their Groupon emails every day to see what the newest offering is, though a certain number of users need to accept the deal for it to take effect.

Although Groupon was only launched in November 2008, it already has 35 million users, and it’s available in more than 150 markets in North America and 100 markets in Europe, Asia and South America. And while Groupon gets the lion’s share of publicity, a very similar site actually has a lot going for it. LivingSocial launched less than a year after Groupon and has more than 26 million email subscribers.

Both sites have their fans, but in at least one business owner’s experience, LivingSocial is a much better option. Romil Patel wrote about it in April 2011 for CNN Money in an article titled, “My terrible Groupon experience (and great LivingSocial deal).”

Patel, who owns numerous fast-food outlets, wrote that “I took one of my outlets and did a Groupon for it, and then did a deal through rival site LivingSocial. Let me tell you right now: It was night and day. Working with one company was a great experience. With the other, it was a mess.”

You can tell from the article’s title which was which. Patel’s biggest issue with Groupon was related to customer service, specifically meaning how his representative handled his account. Patel had problems with several customers’ transactions and emailed his rep about it. He received a reply that read (in part), “I will keep you posted!”

Ten days later, he’d heard nothing from Groupon. Then Patel got word of two fraudulent transactions. He emailed his rep again, receiving the response, “Romil, I will check in on this issue and get back to you shortly.” Ultimately, Patel said, a full 28 days went by–four entire weeks–with no actions to correct the problems by Groupon.

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