What Groupon and Google Can Learn From LivingSocial
I'm a big believer on spending money on experiences instead of things. Sure, you can blow $2,000 on a wonderful big-screen HDTV, but how long are you going to enjoy it before it becomes just another device? Think of the cool experiences that could be had with your spouse or friends for the same amount of money -- experiences that will grow fonder in memory with age.
Apparently, someone at Amazon.com (NAS: AMZN) -backed LivingSocial agrees with me. It's now selling what it calls "LivingSocial Adventures," which are prepackaged day trips for novel experiences. They differ from similar experiential vouchers in that everyone who buys it goes together as a big group with guides. It's kind of like (actually, it's exactly like) school field trips, but for grownups.
Archrival Groupon (NAS: GRPN) doesn't offer an analogous service. That's a pity, since I went on a LivingSocial Adventure on Sunday, and it was a lot of fun.
Shooting a gun has been on my "Things To Do Before I Die" list for some time. So when I saw the $99 voucher on LivingSocial for a "Shootin' and Drinkin'" adventure, I jumped on it. The voucher included everything needed to shoot 25 clay pigeons (including instructors), along with a meal and beer for everyone after the shooting. I was worried that I'd be the only person going by himself on the trip, but there were a lot of people just like me. It proved to be a worthwhile experience, and not just because I now know how to operate a 12-gauge shotgun for the coming zombie apocalypse.
This is precisely the kind of unique thing that Google's (NAS: GOOG) Google Offers and Groupon should join LivingSocial in doing.
Shooting ranges and other adventure destinations have high fixed costs but low variable costs, which makes them ideal merchants for the discount voucher model. At the same time, these day trips allow customers to easily experience events they ordinarily wouldn't go through the hassle of arranging. And since these trips may never be offered again, there is a sense of urgency that doesn't come with a 50%-off voucher for a pair of jeans.
After all, I don't need Groupon to buy jeans anytime I want.
At the time this article was published Fool contributor Chris Baines is a value investor. Follow him on Twitter, where he goes by@askchrisbaines. Chris' stock picks and pans have outperformed 90% of players on Motley Fool CAPS. He owns no shares of the companies mentioned. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.