Groupon, LivingSocial Clamor For Piece of Holiday Sales Action

As Amazon and eBay are set to have a record Cyber Monday, daily deal sites such as Groupon and LivingSocial are also reaping the benefits of the holiday shopping craze.

One in 10 Internet users plan to buy holiday gifts at either Groupon or LivingSocial this year, according to data analytics firm comScore. This is up from 4 percent in 2010.

Earlier this month, Chicago-based Groupon launched Grouponicus Holiday Shop, consisting of expansive, expertly curated collection of deals. The site offered deals with local merchants, but also carried offers including a trip to the taping of The Ellen DeGeneres Show and a cooking lesson with renowned chef Todd English.

Washington D.C.-based LivingSocial, the main rival to Groupon, has also jumped into the online holiday shopping foray. Although many of LivingSocial's deals were with local merchants, deals for Verizon Wireless, The New York Times and Hearst Magazines were also offered through the daily deals site.

Daily deals present a great opportunity to extend a merchant's brand to consumers, which is even more important with the noise surrounding the holiday season, Mitch Spolan, senior vice president of National Accounts at LivingSocial said in a statement.From Black Friday to Cyber Monday, the best place to find holiday presents this year will be on LivingSocial where top retailers will offer our members tremendous deals on great name brands.

Although Groupon and LivingSocial could potentially hurt sales at a traditional online retailer such as Amazon, the daily deal sites are more likely to take retail sales away from brick-and-mortar stores since daily deal sites provide another outlet away from the traditional retail store, comScore senior analyst Andrew Lipsman told IBTimes. However, he said the effect daily deals sites will have on those stores should be negligible for now.

Any individual retailer is a lot smaller than the whole market, Lipsman said.

The National Retail Federation reported total holiday spending of $52.4 billion over the holiday weekend, up 16 percent from $45 billion last year. Lipsman said consumers were spending more both online and offline.

A rising tide has been lifting all boats, he said. Everyone is a winner at this point.