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Groupon’s visitor traffic has skyrocketed over the past 9 months, much of this having to do with it’s unique social spin on coupon’s where you only get the “deal of the day” if enough people sign up for it. For example, today’s Seattle deal is for discounted service from a local handyman service provider. As of this posting, 489 people have signed up for the deal, and only 40 were required to activate it.

Also contributing to Groupon’s growth is it’s expansion from it’s initial market, Chicago, where it is based, to now more than 50 major metro markets. No doubt, this expansion will continue both within the United States and throughout other global markets in the months to come.

Groupon makes a percentage of every coupon sold on its site. If they offer just one deal per day in each of their currently covered 50 markets at an average price of $25 and 500 people buy it, then Groupon generates $625,000 in sales per day. If they keep 25% of that, then they net $156,250 per day, or about $57 million per year. This is just speculation, but it is probably not far off from where they are at.

Is this enough to support a reported $1 billion valuation? It likely depends on their growth rate and how long they can sustain it. A public company valued at 20 times earnings would need $50 million in profits to be worth $1 billion. So maybe they aren’t that far off?

In related news, AT&T launched their own local site, Buzz. Here is more coverage from Forbes. It will be interesting to see how effectively Buzz is able to compete with Yelp.

Askaro’s hyperlocal spin on Q&A is an interesting strategy to compete in a big market where sites like Answers.com and Yahoo Answers pull in huge visitor traffic. But in a category this big, there is always room for new market entrants.

While the early Askaro traffic results aren’t that compelling, it’s still too early to tell if this site will take off.

Apparently it is now starting to attract a lot of traffic. Foursquare recently tweeted that they averaged a check-in per second during Saturday January 9th. And the Foursquare TrafficEstimate chart does show a strong growth trend.

Though, it is hard to equate “check-ins” with regular web surfing traffic, as much of this can be done (and is likely being done) via mobile devices such as the iPhone.

While cool, I’m not sure this will become widely accepted by the mainstream. But big local players, such as Yelp, are starting to look at this space. And even if not mainstream, a passionate niche audience is still likely to produce a lot of unique opportunities for marketers, especially given the local angle.

• This number represents 5% of all merchants in the US
• They have reached this milestone in just over three years
• The competition in this space is high (Yelp, Citysearch)

The service offers both free and paid options for local merchants, but it is unclear how many of the 1,000,000 merchants are paying for the value-added marketing services, such as getting visibility on nearby cities which costs $5 per month. But it is likely to be a small subset of the total pool of merchants.

But even $5/month adds up quickly. If you do the math, at $60/year per paid merchant, every 1.6% of the total pool (16,666 merchants) will generate $1 million per year. I’m guessing that they have far more than 1.6% signed up and that the average yield is far more than $60/year.

MerchantCircle also makes money from ads shown on both claimed and unclaimed listings. Given the substantial traffic to these pages (5.5 million visitors in December according to comScore) it is likely to be well into the millions.

Similar to what Avvo has done for lawyers, MerchantCircle is a great example of how a good SEO play can be a great hook to get businesses to engage with your web site.