Facebook Deals reach Europe

01 February 2011

LONDON: Facebook, the social network, is introducing its Places Deals service in several key European countries, allowing marketers to send tailored offers to mobile phone users.

Places Deals, being launched in Germany, Italy, France, Spain and the UK, promotes discounts and incentives from retailers, restaurants and similar outlets to nearby Facebook members using wireless handsets.

It was unveiled in the US during November 2010, attracting organisations like H&M, Macy's and Gap, and is accessible via iPhone, iTunes and Android apps.

"The wisdom of friends has taken over from the wisdom of crowds, through a highly personal experience in the real world," Emily White, Facebook's director of local, told the Guardian.

"Facebook local enables users to take that Facebook identity out and about … Places is the 'where' to 'what am I doing' and 'who am I with'. And it allows businesses to start joining the conversation.

"Doing Deals does drive 'liking' of pages. Over time that relationship will become more explicit."

Among the UK brand owners leveraging this opportunity - which is currently available to clients for free - is Starbucks.

The coffee chain is giving the first 30,000 individuals "checking in" to relevant branches a free cup of coffee.

Debenhams is also running an initiative handing 1,000 shoppers cosmetics products when they visit its department stores.

Elsewhere, telecoms specialist O2 awarded the four people fastest to upgrade existing subscriptions a PlayStation or Xbox games console.

Automaker Mazda provided a 20% price cut on the MX-5 sports car at five forecourts, equivalent to a £4,000 ($6,361; €4,647) saving, if buyers sent check-in data to their news feeds.

Restaurant chain Yo! Sushi and theme park Alton Towers announced further efforts, while retailers Argos and Benetton pledged money to charity.

"Retailers don't actually care about eyeballs, they care about the faces in the store," said White.

Benetton will donate €2 for every check-in, and believes achieving 50,000 such interactions would constitute a success.

"I think there is a parallelism between 'The United Colors of Benetton' and a social network," said Gabriele Lunati, Benetton's digital director.

"We are going to increase the use of Facebook and other social media platforms. It belongs to a more complex digital strategy for Benetton that we will create this year and next year."

According to Ian Maude, head of internet at research firm Enders Analysis, Facebook's strategy should prove particularly profitable, as it merges the benefits of popular alternative properties.

"This move is a no brainer for Facebook. Places Deals is a combination of Foursquare meets Groupon," he said.

"It is the company's first major move into mobile, discounts and location based advertising. I think this has the potential to be a smash hit for them."

But White suggested Facebook's latest package is set to occupy an untapped position in the market.

"I don't think this will kill Groupon," she said. "It is very different from Groupon's offering today and takes advantage of the unique platform Facebook has.

"We don't want to kill Groupon, they have been an amazing partner on a number of fronts."

The localisation of Facebook's marketing services may also heighten its rivalry with Google, which has effectively monetised the long tail of advertising over recent years via search ads.

Data sourced from Daily Telegraph, Financial Times, The Guardian; additional content by Warc staff