Mertado brings shopping deals to games and websites

Mertado, a startup incubated by Y Combinator, has been working on bringing a fun, deal-based social shopping experience to Facebook. Today, it’s offering game developers and website publishers a way to make money from its deals too.

Basically, the Palo Alto, Calif. company offers a service where users can find deals and share them with friends. But it seems to have two advantages over other social shopping startups, like “Foursquare for Products” Snapdragon, or deal sites. For one thing, it’s integrated with Facebook (Mertado has both a Facebook application and a standalone website that uses Facebook Connect), so it can recommend products based on your profile, and you can recommend deals to your Facebook friends.

And the company isn’t aggregating deals found on other sites — Mertado is actually the seller, so it can make sure there’s a good mix of decent products, and that customer complaints get resolved.

With its new Embedded Shopping widget, Mertado can bring its deals to a broader audience (though the game mechanics and sharing features are mostly stripped out). Facebook game developers can offer their players a way to earn Facebook Credits to spend in their game by watching a video ad for Mertado’s latest deal and purchasing the product (similar to how other offer programs work inside of Facebook). Website publishers can add a deal widget to their site.

Initial partners include game developer Gamador and deal website dealnews.com.

Co-founder and chief executive Vijay Chittoor said that Mertado’s biggest audience so far consists of 30- to 60-year-old women, and that some of those women turn into really loyal fans. In the last two months, some customers have made more than 20 purchases, he said. Popular product categories include kitchenware, beauty, and health care — for example, one of Mertado’s big hits is a microwave pasta cooker called Fasta Pasta.

Mertado has raised more than $1 million from Redpoint Ventures, Blumberg Capital, and Stubhub founder Jeff Fluhr.