Facebook Deals: What does Zuckerberg's latest move mean for your business?

Building on its recently launched Facebook Places platform, the social networking giant has now unveiled its latest trick in the UK: location-based marketing for businesses through Facebook Deals.

The social network's latest feature, which launched across Europe yesterday, enables firms to broadcast special offers to Facebook users in their local area, which can be redeemed when the user 'checks in' on Facebook Places and shows the voucher on their mobile phone.

In other words, the service (which has been live in the US since November last year) enables users to find deals in their local area, while potentially boosting footfall for participating businesses. Firms offering a deal are flagged up with a gold ticket, and offers can be claimed if the user checks in.

According to Facebook, more than 200 million people currently log on to the social network via their mobile phone. Different types of deals will be available through the service, ranging from straight discounts to those that reward you for bringing friends along. Joanna Shields, Facebook's EMEA vice president, insisted that the new service gives businesses the opportunity to 'connect with people in an entirely new way'.

"Facebook Deals represents the power of word of mouth marketing and personal recommendation," she said. "By checking in and taking the deal, this is shown on your news feed so your friends can also see what deals are taking place."

Online deals (Groupon, MyVoucherCodes, MoneySavingExpert) and location-based services (Fourquare, Google Maps 5.1) have been massive growth areas over the past few years, so it's unsurprising that the social networking giant is eager to get a piece of the action. More than 13 million people have subscribed to group-buying site Groupon since its launch in 2008, and Google was recently rumoured to be in talks to buy the firm for a staggering $6bn.

Unlike Groupon, which takes a cut of the revenue it generates for participating firms, Facebook Deals is currently free. So far, only a handful of larger firms, including Mazda, YO! Sushi, O2 and Starbucks are trialling the service in the UK; Starbucks is offering free coffee to the first 30,000 users, while Mazda is offering 20% off at certain dealerships.

Given Facebook's vast reach among consumers, (its membership base is more than 500-million strong), the service could potentially prove to be a valuable tool for entrepreneurial businesses vying to make their presence known among their larger counterparts. So are you excited by Facebook Deals?

Joe Friedlein, director at ethical search marketing agency Browsermedia.co.uk, seems to be. "I've been looking forward to Facebook Places Deals launching in the UK, not because I'll use the service - I probably won't - but because this is a very interesting time for location marketing," he told Smarta.com.

"The idea itself is nothing new, but Facebook does have many advantages over other services, the main one being its size and reputation. This makes it easy to attract high profile partners and its massive user-base guarantees 'check-ins' from the word go."

However, he does not envisage that it will strike a fatal blow to Foursquare, as some have predicted: "There's been a lot discussion about how the launch of Facebook Deals will affect Foursquare. Most say that it's doomed. I disagree. The response from the regular Foursquare users I have spoken to claim that they don't use the service for the sole intention of getting stuff for free; social media goes much further than free coffee.

"Facebook Deals is a 'deals' service that focuses purely on promotions," he continues. "This isn't to say that this is a bad thing, in fact it's a very clever model because essentially, everyone's a winner."

That said, he believes both Foursquare and Groupon will be "peering cautiously" over Facebook's shoulder. And as the three-way battle between the companies commences, he sees one clear winner emerging - "the consumer".

However, Will Wynne, managing director of Arena Flowers, believes the current hype surrounding all things local could potentially be detrimental to web businesses.

He explained: "Local, be it in Google Maps or more recent variants such as Foursquare, Groupon or Facebook Places, is undoubtedly a promising (if exceedingly price competitive) new route to market for local businesses.

"However, this obsession with local can potentially be detrimental to the customer because it is tricky for businesses that are primarily web-based, such as our own; while our business has only one actual physical location in the UK in west London, we deliver nationwide and generally provide a superior experience and product than a local retailer would, on the back of our sophisticated supply chain and business model.

"Local search engines and offers favour the local retailer purely because they are local (we can't offer vouchers to potential customers in Bristol, because people can't 'check in' to us there, as we have no physical store). In my opinion, in certain categories this may end up driving consumers to suboptimal retail partners, merely because they are 'local'."

What do you think? We would love to hear your thoughts on what Facebook Deals means for brands. Is it a marketing game-changer? Let us know below.

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