• Reuters, Tuesday, September 13, 2011 11:41 AM

Perhaps more publicity stunt than money-making proposition, LivingSocial has teamed up with Whole Foods to run the first nationwide grocery store daily deal. Archrivals Groupon and LivingSocial have run grocery deals before, but such offers were focused on small areas or niche outlets, according to David Sinsky, data product manager at deal aggregator Yipit.

"It is hard for grocery stores to offer deep discounts because they already operate with thin profit margins," Reuters notes. That suggests to Sinsky that LivingSocial is subsidizing the Whole Foods deal for publicity purposes. "In return for such a subsidy, LivingSocial gets to run what may be a popular deal, giving it the chance to attract a lot of new subscribers," as Reuters puts it.

LivingSocial, which still trails market leader Groupon, is expected to offer $20 worth of products at any Whole Foods store for $10 beginning on Tuesday. So the promotion doesn't get too out of hand, LivingSocial said it plans to cap the offer at 1 million vouchers.

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