The super-hot local deals space just got more crowded, with Visa introducing a new iPhone app with offers from more than 50 partners including Papa John's Pizza, Holiday Inn, Tourneau and Pearle Vision. Through the free app, Visa will show users nearby locations of participating merchants where offers can be redeemed.
The deals and discounts presented can also be tailored to match consumers' lifestyle and interests across categories -- including clothing, jewelry, travel and entertainment. Account holders with Visa Signature cards will get special Signature offers in addition to the standard ones.
With the local deals segment to date defined by startups like Groupon, Offermatic and LivingSocial, Visa might be viewed as another established behemoth coming late to the party. But the big advantage it has over these competitors is that it already has the card numbers for roughly 40% of the credit card customers and 60% of the debit card users in the U.S.
No middleman is needed, so users' security concerns about passing on card information to an unknown upstart like Offermatic or a personal finance service like Mint.com are minimized or eliminated. Plus, Visa's visibility into account holders' purchases gives it the ability to customize offers according to their buying habits. And the fact that app users of have control over the types of deals they see is obviously better than a program providing only random deal-of-the day offers.
Of course, the quality of the deals themselves remains to be seen. But the Visa Mobile app rolls out with a pretty wide cross-section of national retail, hotel, restaurant and other chains. And given Visa's widespread merchant relations, the initial group of 50 partners is likely to grow, perhaps eventually sweeping in non-chain local businesses as well. The release of version for Android and BlackBerry phones may not be far behind, either.
The new app makes you wonder why the payments giant didn't roll it out sooner, and whether MasterCard or American Express will soon follow suit. But if it took startups like Groupon and others to show the way, Visa's entrance into the fast-growing local offers market online will certainly be felt by other players in the space.