LivingSocial Buyers Richer, Smarter Than Groupon’s, Study Says

People who buy online coupons from LivingSocial are richer, younger and smarter than customers of market leader Groupon Inc., according to a study by Nielsen Co.

LivingSocial users are 49 percent more likely than the average American online to make at least $150,000 a year, compared with 30 percent for Groupon, according to the survey released today. They are also more likely to be younger than 35 and to have college or graduate degrees.

The sites, which offer discounts of as much as 90 percent off at local businesses, are racing to dominate a market worth billions. LivingSocial, the second-largest coupon site, raised $400 million in its quest to overtake No. 1 Groupon, according to two people with knowledge of the financing. Groupon is preparing for an initial public offering that could value the company at as much as $25 billion, according to a person familiar with that process.

Groupon’s customers are older, with 57 percent aged 35 to 64, compared with 51 percent for LivingSocial, a third of whose buyers are in the 21-to-34 age range, the study said. The study found 46 percent of LivingSocial’s clientele had attended or graduated college or received other degrees, compared with 39 percent for Groupon.

Nielsen, based in New York, also found that about two- thirds of LivingSocial and Groupon users are women.

The survey results come from a panel of 200,000 Internet users that Nielsen tracks for Web activity. Another survey of 36,000 Internet users aged 18 and older indicate that deals on gardening services and products have the most appeal, with 47 percent of participants interested in the category. Coupons for home repairs and religious involvement were the second and third most attractive, Nielsen said.

To contact the reporter on this story: Ryan Flinn in San Francisco at rflinn@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net