Tuesday, 1 February 2011

Facebook Deals – adding the ‘what’ to the where and who

Facebook Deals is the new service from Facebook. Put simply Deals puts retailer- or brand-driven promotions into the hands of customers who disclose their location by “checking in” at a venue.

Checking in is accomplished by connecting your mobile phone’s GPS location capabilities to a directory of venues’ locations. When a Facebook user gives her location, Facebook can not only connect that location to a venue (the existing Places service) but can now direct a ‘deal’ or offer to that user.

So much, so Foursquare (the location-based service that allows users to ‘check in’ to venues). Also there are echoes of Groupon, but this is no clone monster designed as a me-too service. Rather, FB Deals builds on a the growth in mobile use of Facebook, the desire of users to ‘connect’ with a brand or retail location, and the interest of retailers in connecting with those customers who are present and thinking about them.

The interest for retailers lies largely in the Facebook ecosystem, it’s “friend” focus and the analytics available. Some benefits include:

  • deals can be unlocked when, for example, TWO friends are together (an example being YoSushi’s offer, that gives some free food where two friends check in to eat together. This is a means of new customer acquisition, rather than simple rewarding habitual customers for checking in)
  • when customers check in the retailer can access rich information about them from their Facebook profile – gender, age, aspects of their social graph and shared information. This can supplement customer insight programmes and assist in future targeting.
  • the service is, according to Facebook, free of commissions and charges to the retailer.

Joanna Shields, VP EMEA at Facebook, noted “Facebook is built around people and sharing personal experiences and Deals is a great extension of this. By bringing valuable and relevant offers to you wherever and whenever you want them, Deals delivers a powerful experience that combines technology and location in a way that a pure online or offline experience could never deliver”.

Some retailers ‘in’ on the launch include Argos, Benetton and Debenhams. Both Argos and Benetton are offering charity donations in return for checkins by customers. This could demonstrate that the back-end systems to create and manage promotions are not yet in place, or that they’re taking a ‘marketing promotions’ approach in the early stages. Debenhams have an offer for Valentine’s Day, where up to 1,000 mascaras will be given to the first 10 people in each store who check in.

Harriet Williams, Head of Digital Development at Debenhams, noted:

“With over 60 per cent of our customers active on Facebook and 164 Debenhams stores across the UK, we predict a rush of keen shoppers will be checking into our stores and checking out our deals”

The test for retailers will be the ease of management of the deals, integration with promotional engines and campaign management, eCRM integration – and not least, whether smaller retailers will get access to the scheme.

All of these questions will be answered in time, but as of today Facebook has added a further reason to spend one’s life glued to a mobile phone, and retailers have a further promotional channel to exploit.


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