Considering these variables, deal a day could grow to as much as $6.1 billion by 2015 (47.4% CAGR), though a very conservative outlook pegs the space at $2.1 billion (19.7% CAGR).
Deal-a-Day Gross Revenues (Million Dollars US; +35.1% CAGR)
Source: BIAKelsey, March 2011
Mark Fratrik, vice president, BIA/Kelsey, says "... during the three year incubation period beginning in 2008, Deal a day has experienced incredible growth... companies in the space are rapidly adding markets and increasing total user count... subdividing existing metros to provide deals closer to where users live... will help offset any drop-off... as the novelty of the form fades."
As of March 1, 2011, BIA/Kelsey estimates there are 178 cities with deal-a-day sites reaching 102 million people in the United States. The report says that, while Groupon and LivingSocial lead a marketplace of 200-plus players, the broader field includes destination sites and white-label providers working with local media providers such as directory companies, newspapers, and radio and television operators.
"The combination of fun offers and convenience makes deal a day a very attractive way to reach local users, and for publishers to work with small businesses," said Peter Krasilovsky, vice president and program director, Marketplaces, BIA/Kelsey. "We expect to see some shift in local media spending resulting from the adoption of deal a day by local advertisers. We also believe that deal a day doesn't exist in a vacuum. It will become a part of the growing deals and offers landscape."
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