NEW YORK (CNNMoney) -- Groupon Now, a mobile app that connects customers with real-time coupons for retailers in their vicinity, launched in New York and San Francisco on Wednesday, the next phase of a gradual nationwide roll-out.
The real-time service launched last month in its first market, Chicago. The app, available on the Web and on mobile devices, aims to help merchants attract customers during down hours.
Walking around downtown Manhattan? Customers who tap "I'm hungry" Wednesday afternoon will be offered a $10 credit for $7 at local pizza restaurant Olio Pizza e Piu. But buyers have to move fast: The deal is good for just a few hours.
Want to get pampered? You've got less than three hours to make it to Jin's Nail Spa for 36% off a manicure and pedicure. Bored? Sign up for 50% off a Belly Dancing Class thirty minutes before it begins.
It's Groupon's latest move to position itself against many of the daily deal clones that have launched as rivals to the stratospherically fast-growing service. Groupon is placing big bets on real-time, location-based discounting.
Maria Baugh, co-owner of Butter Lane Cupcakes in Manhattan's East Village, is testing out Groupon Now but doesn't expect a big response early on.
"It's a bit of a beta," she said. But the co-owner plans to keep using the service, which she says is easier on the local business than the traditional daily-deal coupon.
"The appeal for us is that we can control it ourselves," she said. "If we find that after a day or two ... we're not getting such a great response or its too crazy, I can log on and change it."
Baugh plans to offer time-sensitive deals Mondays through Wednesdays during slow business periods. In the past, people using daily deal coupons have used them during busy hours, putting a strain on the business and its employees.
Baugh hopes Groupon Now will bring in business without the headache
"The nimbleness of it is really interesting, and the control that we have is one of the things that's really appealing for us," she said.
Groupon has also teamed up with location check-in service Loopt to push out time-sensitive deals. Users checking in on Loopt will receive alerts when they're walking by a deal. The deals will also be posted on Loopt's place pages so people using the app can see deals around them.
Groupon founder Andrew Mason is slated to speak Wednesday afternoon at the D9 conference in Rancho Palos Verdes, Calif. 
