LivingSocial Testing Subscription & Bonus Service
LivingSocial has announced its latest attempt to get customers to buy deals on a more 
regular basis. It’s like pre-pay VIP access, and it could prove to be positive for business.
The program is called “Living Social Plus” and it works like this: 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. To entice customers to look into the new service, when customers check out, LivingSocial has started putting a graphic that shows the price of the currently viewed deal instantly reduced by the $5 in bonus Deal Bucks, next to what the customer is paying for their deal.
A subscription deal like this could help eliminate the problem of deal cruisers; people who only stop by to purchase especially rare or relevant deals. If a program like this establishes itself as valuable and easy to use by customers, and produces a consistent revenue stream, you can expect other deal companies to follow suit; quickly.
LivingSocial hasn’t officially launched LivingSocial Plus, it’s still in beta testing, so users not in the test group are still redirected to the regular LivingSocial website, but this article confirms its existence. The pre-paid membership service started offering deals to the test group on Black Friday. Previously the only way to earn Deal Bucks was to invite friends to the service. The deal provider has been aggressively innovating in search of new models that could save it from the decline impacting Groupon. It just launched LivingSocial Instant and Room Service last month that lets people get discounted food delivered on demand.
The $20 that customers paid to be a member are good for purchasing deals for 5 years, but the $5 in bonus bucks are only good until the end of the month, which creates a sense of urgency to actively look for and buy deals. The whole daily deals model is built on the notion that perceived value exceeds what users have to pay, even if they’re paying for things they don’t need. Meanwhile, it’s really the deal providers that could win since most purchases net them far more than $5.
Could this pre-pay deal model work? According to TechCrunch, access to closed deals is a great addition to the subscription package, since buyers may be willing to pay for it but it doesn’t cost providers anything. LivingSocial may have figured out the next big thing in daily deals.
Paying $20 in hopes that you’ll soon find a deal that you’ll want? Might people subscribe after seeing a deal they want expire, in hopes they’ll have access to it? How badly would you have to want a deal to do that?
Source: TechCrunch
