AmazonLocal, which debuted in select cities including Seattle, Los Angeles and Chicago in early August, is coming to New York City. With Groupon's IPO lingering, Amazon looks to be moving aggressively to impede the daily deals giant's momentum.Amazon is bringing its daily deals Groupon competitor to the largest city in the United States.
Since New York City is so big, Amazon says that the initial rollout will be for most of Manhattan (downtown, midtown, uptown including upper east and west sides) and Brooklyn. Amazon made no mention of the Bronx, Queens or Staten Island. Coming to New York City is a significant move for AmazonLocal and perhaps a precursor to a nation-wide rollout. Are you more inclined to use an established e-commerce company like Amazon for daily deals over startups like Groupon or LivingSocial?
In addition to its daily deals offerings for physical locations such as spas, restaurants, cupcake bakeries or yoga studios, AmazonLocal will offer deals through the company's subsidiary sites such as Myhabit.com and 6pm.com, as well as the main Amazon.com homepage.
It remains to be seen if the daily deals phenomenon will retain traction among consumers. Groupon created the industry and has seen it grow wildly in the last several years but there are signs of consumer fatigue. Yet, Groupon continues to make aggressive moves to expand its core features and geographic range. We will see in late September or October, when Groupon's IPO day comes, how investors rate not only the company but the daily deals space as a whole.
Amazon probably likes what it has seen with the AmazonLocal product line to move into New York City. As we noted earlier in August when Amazon first rolled out its daily deals service, it has some significant advantages over Groupon. It has a mature infrastructure, the payment information of nearly all its members and experience in dealing with local merchants.