The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

By Tom Taulli, InvestorPlace Writer

NEW YORK ( InvestorPlace) -- It's not too hard to develop a daily-deal site. All it involves are some basic e-commerce capabilities as well as an e-mail marketing system. The big problem is getting users and merchants to the site.
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  • Based on a recent report from Daily Deal Media, 798 daily-deal sites shut down in the last six months of 2011 (on a global basis). Then again, this represented only a 7.61% drop in the overall numbers. Keep in mind that most of the closures were in Asia, which saw 1,348 sites disappear.
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  • All in all, this should be good news for leaders such as Groupon ( GRPN) and LivingSocial. They definitely benefit from their scale and brand power. Still, they are likely to feel heat from other large players, such as Amazon ( AMZN) and Google ( GOOG).
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  • Daily Deal Media came up with some other interesting data as well. Its survey of merchants shows that 35% are unprofitable. Yet satisfaction increased by 17% from June 2011 to December. Why? For the most part, a daily deal is not really about making money. Instead, it's a way to generate buzz, which hopefully will lead to future business.

    Tom Taulli runs the InvestorPlace blog IPOPlaybook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of All About Short Selling and All About Commodities. Follow him on Twitter at @ttaulli. As of this writing, he did not own a position in any of the aforementioned stocks.

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  • This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.