January 23, 2012, 11:16 AM

Groupon acquires a social shopping startup

The deal enables the daily deal operator to snag more talent.

Lead Photo

Groupon Inc. has acquired social shopping site Mertado.com, which enables consumers to find and buy products through social networks such as Facebook.

Mertado will shut down on Feb. 28 and several of the company’s staff, including its founders Vijay Chittoor, Mehul Shah and Rajiv Bhat, will join Groupon.

“Mertado has shown a great level of innovation in the social commerce space,” says a Groupon spokeswoman, who points to Mertado TV as an example of its inventive approach to social commerce. Mertado TV, which launched last September, enabled consumers to watch syndicated content originally developed for networks such as the Food Network, while, at the same time, being presented with related products found in Mertado’s catalog.

The deal is the latest example of a daily deal operator adding talent via acquisition. Groupon made a similar move in December when it bought social media technology company Campfire Labs, which had yet to officially launch.

“This talent land grab feels like the slow and steady rise of panic; an attempt to bring smart people in that might be able to change the path of a sinking ship before it’s too late,” wrote Vikki Chowney, news editor for consulting firm Econsultancy, in a blog post. She refers to Groupon’s middling stock price. While shares rose rapidly when Groupon initially went public in November at $20 a share, shares opened today at $20.60 a share. That, Chowney suggests, shows that investors may be weary of waiting for the daily deal operator to turn a profit.

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