Daily deal site growth will slow through 2016

The daily deal business has seen huge gains in spending the past couple years, and will grow by leaps and bounds again this year.

But the following few years? Not so much.

The space, which includes Groupon and Living Social, is reaching maturity, according to a new forecast from local ad tracking firm BIA/Kelsey, which projects that over the next few years year-to-year growth will slow to single-digit percentages.

This year daily deals will continue to see huge gains, with U.S. consumer spending rising 86.9 percent, to $3.6 billion.

Next year it will be up 23 percent, and it will peak with $5.5 billion in spending in 2016.

“After astronomical growth in 2012, the online deals marketplace is showing signs of maturity,” says Peter Krasilovsky, vice president and program director, BIA/Kelsey, in the report.

“There has been consolidation in the space, deal conversion rates may be suffering due to over-familiarity, and the market may be near saturation. Still, market leaders continue to exhibit growth as market awareness and penetration spread." 
 

Tags: bia/kelsey, daily deals, daily deals forecast, deals, following, forecast, forecasts, groupon, living social, online, Peter Krasilovsky, the following, U.S.