LivingSocial is combining two industry buzz words in its latest offering: location-based and daily deals. The No. 2 daily deals e-commerce site is testing in its headquarters of Washington, D.C.,  Instant Deals, a new feature within in its mobile app that lets users search for deals within a half-mile radius of their current location.

Unlike LivingSocial’s usual daily deals, which are live for 24 hours, Instant Deals are live for a short period of time. The goal, LivingSocial says, is to help merchants attract traffic during slow times. For example, a lunch restaurant can increase its sales during a slow afternoon by offering a special deal between 3 p.m. and 5 p.m., LivingSocial says.

“As the local commerce industry continues to evolve, we continue to innovate our products and deepen our merchant and customer relationships,” says Tim O’Shaughnessy, CEO of LivingSocial. “We’re headed into unchartered territory, focusing on meeting merchants’ varying business goals with members’ demand for instant access. We know from working with our members and merchants that the best way for both to interact in an efficient marketplace is to offer flexibility with the timing and the kinds of offers we provide. Instant Deals is the perfect complement to the daily experiences we’re already offering.”  

Consumers who click on Instant Deals within the LivingSocial app will receive notifications about deals within half a mile of their location. The app also allows consumers to keep track of their purchases as they can with other LivingSocial daily deals. LivingSocial says it will focus its testing of the feature in high foot traffic areas in Washington, D.C., such as Chinatown, Dupont Circle and U Street.

LivingSocial operates in U.S. and international markets and has more than 20 million subscribers. It says it has saved its users $311 million since its launch in 2009.