Living Social was launched in 2007, formerly as the Hungry Machine, that allows its members to buy experiences near their city and share them with their friends.

Similar to GroupOn, which was launched a year later in 2008, Living Social provides deals for nearby events, restaurants, and services. One can simply enter their location and browse nearby deals. With that, comes some advantages and disadvantages for both consumers and merchants.

Consumers benefit from Living Social’s deals by being exposed to coupons for Merchants they would have otherwise, not known about. By providing these deals, consumers are able to try out new merchants or services, such as the Hello Fresh Meal Delivery deal below.  A disadvantage for consumers would be waiting for deals such as this to arrive. They may hold off on purchasing items or experiences if they know a deal will be available on LivingSocial.

Merchants can also benefit from LivingSocial’s deals as it brings new customers who would otherwise, not have known about the product or company. A disadvantage, however, is that consumers will often compare deals across sites, ultimately choosing the best value. Living Social may have a good deal, but another website may have a better value.

In order to differentiate from its competitors, Living Social can offer a rewards program deal for its most popular merchants. For example, restaurants can have rewards points system with Living Social that allows them to maintain current customer satisfaction with the hopes of enticing new ones, through specialized deals.

Could there be a “killer” product or service Living Social could offer which would benefit both consumers and merchants? Share your thoughts in the comments.