“LivingSocial Plus”: A Monthly Subscription Model That Could Improve Deal Site Retention

In an effort to get customers buying pre-paid deals more regularly, LivingSocial has launched a new subscription service called "LivingSocial Plus". For $20 a month, members get $25 in "Deal Bucks" credits that are automatically applied to their next purchase as well as access to closed deals. LivingSocial is cleverly pitching buyers on Plus with a checkout graphic that shows the price of the currently viewed deal instantly reduced by the $5 in bonus Deal Bucks. Subscription services like this could solve a fundamental problem of deal providers where users only stop by to purchase especially lucrative or relevant deals. If these program gain traction, providers could establish a consistent revenue stream, get users buying more frequently, and score free cash if credits are never redeemed. Expect rampant copying if competitors see the subscription model working.

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