Yahoo! wants to be the coupon section of the Internet

Yahoo! wants to be the coupon section of the Internet

Yahoo! today announced a new beta service called Local Offers that will be an aggregator of many of the coupon/daily deal/group buying services out there, including both Groupon and LivingSocial.

According to a press release,

Yahoo!’s Local Offers program is open to all deal providers, including local “deal of the day” partners and traditional direct-marketing partners, offering them an effective way to target offers and reach engaged audiences. In the near future, Yahoo! will extend the reach of its Local Offers program, making it available to more consumers throughout the US.

The other announced partners are; Gilt City, BloomSpot, BuyWithMe, DealOn, Zozi, CrowdSavings, Lifebooker, FreshGuide, Scoop St, Goldstar, HomeRun, Tippr, Coupons.com, and Valpak. Most notably missing to us is Yelp, though Yahoo! promises that more partners are forthcoming.

So basically, Yahoo! has made the decision to not deal directly with local merchants (at least right now) and instead just leverage its traffic to drive more people towards already existing deals (we’re assuming that Yahoo! gets a cut, but there isn’t any mention of that in the press release).

Karsten Weide, a VP at research firm IDC, was quoted in the release as saying:

Consumers are inundated with offers, both online and off. I think a service that aggregates several different special deals sources will give consumers great deals and make the marketplace much more transparent. For partners in such a service, the audience reach of a large partner will give them a lot of much needed distribution.

We more or less agree, though Groupon itself would probably constitute “a large partner”, though more distribution is rarely ever a bad thing, so it’s hard to see this as a negative for Groupon or any of the the other partners in this announcement. From Yahoo!’s perspective, this would seem to be the quickest way into becoming a player in this market, though how people find/get these coupons from Yahoo! is unclear, though we would image that it will be a combination of a dedicated space on the homepage, integration in Yahoo!’s mobile apps and pushed through email.

Search, however, could be a problem for Yahoo! here, as we suspect that Google could easily swoop in with a “deals” search option (perhaps integrated into Google Places?) that crawls all of these sites/deals in near real-time and then that could almost instantly be a faster way to find the deal users are looking for. Of course, if Microsoft’s Bing beats Google to that, then – as Bing is now used in Yahoo! search, then perhaps Yahoo!/Bing could work something out where searches go to Yahoo!’s hub (or whatever it builds).

So overall, a good idea, but one that Yahoo! is really going to have a hard time holding onto unless it figures out the search aspect of it quickly.

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