Facebook Deals will be Holy Grail of location-based mobile couponing

By Giselle Tsirulnik

February 2, 2011

Checking in

Mobile and social media experts are embracing the idea behind Facebook Deals, even though there are several initial limitations of the platform that have important implications for marketing and customer engagement strategies.

One of the most important limitations of the platform is the fact that Facebook retains all of the demographic data of consumers who check-in and "like" businesses’ Places and Deals. So, while there is no argument that Facebook Deals is a great way to start a mobile conversation with customers, it will not give businesses a better understanding of individual customers and their friends.

“There is no doubt that Facebook Deals is an easy way for any business to get started in the mobile and social space, since it allows businesses to reward the early-adopters willing to check-in at their places,” said Steve Jarrett, founder/CEO of MePlease, Richmond, England.

“At the same time, we know that the future of marketing is quickly becoming focused on personal, one-to-one conversations with your customers and not a general broadcast to an anonymous group of Facebook users,” he said.

“This means that businesses must develop a wider marketing strategy where Deals is just one component of customer engagement and not a strategy that is entirely reliant on it.”

A Facebook smartphone would deeply integrate social

Since businesses do not get to keep the demographic data of consumers that check in at their locations, the conversation remains a one-to-many broad-reaching communication that is generic and fairly anonymous, per Mr. Jarrett.

Regardless of the limitations, Facebook Deals is expected to have a large impact on the mobile marketing space.

High expectations
Michelle Barna, director of social marketing and brand communications at Venda Inc., New York, has high expectations for the platform.

Facebook is upping the ante with LBS

“With the increased popularity of smartphones, applications, mobile Web browsing and the like, mobile marketing has become much more mainstream and an initiative on many companies and brands to-do list,” Ms. Barna said. “Now with the addition of Facebook Deals, mobile marketing is on the fast track to the must-do list.

“With Facebook nearing 600 million users and over 200 million of those users on its mobile products, local businesses are now given access to an incredible database of active and engaged consumers,” she said. 

The uptake of Facebook Deals may pose as a threat to smaller services such as Foursquare and Gowalla. These smaller players will be forced to revolutionize and stay on their toes, which is a positive for the consumer and the marketer, Ms. Barna said. 

Foursquare and Gowalla are accessing a smaller pool of people, and in turn a smaller group to market to.

As such, in order to thrive in the space they will have to offer something unique and innovative that sets them apart from Facebook Deals, or at least complements it.

“The rise and popularity of local online daily deal sites such as Groupon and LivingSocial illustrates that Facebook Deals has the potential to be incredibly large, with the possibility of being the largest,” Ms.  Barna said. “The reason? Scale and accessibility.

“Facebook is nearing 600 million users and is accessible on multiple mobile platforms, making Facebook Deals easily available regardless of carrier, location or handset,” she said.

Businesses can make the most out of Facebook Deals by building a loyal customer base through a handful of different deal offerings, while tapping into the incredible social circulation Facebook has to offer, per Ms. Barna.

Additionally, within Facebook, businesses have multiple ways to promote their deal by either posting the deal to their Facebook Page or Place, purchasing Facebook Ads, or as a Facebook user enters a store seeing the deal once Facebook Places is accessed on their phone.

“Mobile is becoming more social by the day, and by bringing the world’s largest social network to the mobile platform and giving users and businesses a place to connect that bond is bound to grow stronger,” Ms. Barna said.

According to Ron Schott, senior social media strategist at Spring Creek Group, Seattle, the pure fact that Facebook has roughly 600 million users and about 200 of those use its mobile version makes any sort of marketing-based aspect appealing.

Add to it the fact that mobile use of Facebook is continually on the rise and there is a definite opportunity for low-cost deal distribution that can help small and mid-sized businesses in addition to the big-box retailers and traditional bricks-and-mortar shops.  
 
"I think the space, even in it’s infancy, can definitely do with more competition," Mr. Schott said. "The biggest thing Foursquare and Gowalla have going for them are their devoted fan bases, but with Facebook you’re looking at a large user base that, in all reality, is still getting used to the idea of checking in at a location. 

"I do think the Deals platform aided by Places will grow to be one of the larger deals platforms out there, but not without some time and trial," he said. "When people open up Foursquare, Gowalla or Whrrl on their mobile device they’re doing it specifically to check-in at a specific location and tell their networks.

"When someone opens up Facebook on their mobile device, they have to consciously make a decision to navigate past the noise of their feed, message, etcetera, and then check in. For that reason alone, I think we’ve seen a bit slower adoption since the initial launch of Places and Deals." 
 
Best practices
Mr. Jarrett has some best-practice tips on his blog that marketers should adhere to when beginning their move into Facebook Deals and Places:

• A fan page and a Place page is not one in the same.
Most businesses do not know that a Facebook fan page is a basic presence on Facebook, which by now, most brands already have. Facebook Places, which is the entry point into the Deals, is completely different.

The Place page is where Facebook aggregates check-ins from that specific location.

• Create a Facebook Place.
As on now, if consumers check into a location on Facebook  that no one else has checked into, that consumer actually creates the Place page for that business.

Because of variations in spelling and letter case, some businesses have several pages for many locations. This means that a business has to dig deep and claim each and every single one of its locations as an official Place.

All that needs to be provided is an email address to verify the Places page. The email address is linked to that specific location.

• Are Facebook Deals ideal for everyone?  
Facebook Deals leverages people’s existing use of the Facebook applications on iPhone and Android smartphones instead of requiring them to download a separate app or join another service. 

If you decide to offer a deal, when a customer checks-in on a smartphone at one of your locations, they will be pushed your Facebook Deal that is on offer. 

Mr. Jarrett recommends that businesses promote their deals to optimize visibility and exposure.

• Develop a long term mobile and social strategy, not just a Deals strategy.
Marketing has become mostly about a personal, one-to-one conversation with customers. Strategies that rely on this type of communication have come out of top as consumers really value personalized messages.

Marketers need to incorporate on a broad marketing strategy where Deals is just one aspect for engagement.

“Facebook as a social mobile platform, there’s a natural affinity as an online platform for mobile access,” said Pratick Thakrar, founder of Imagine Worldwide Ltd, London.

“It is a great vehicle for aligning the brand but it is so important you don’t follow standard ad placements,” he said. “The true value is in customization, which can provide the richness that drives the engagement that brands and agencies want.

“Facebook can provide geotargeting, age and gender association so Facebook Deals demonstrates the importance of localized deals through the mobile channel.”

Final take
Here is a demo o theFacebook Deals service

Comments on "Facebook Deals will be Holy Grail of location-based mobile couponing"

1. Mike Janowski says:

   February 5, 2011 at 2:06pm

   Facebook Deals is new and will be the best and most widely use deals for the simple fact that Facebook is a true Social Network, not whatever you want to call FourSquare. So when friends see that their friends posts that they have used Facebook Deals at so-and-so's business from their News Feed, then they will start using it to see what deals they can use and the word will spread, and then the business owners will find out that they can use this for FREE and will. Small businesses can utilize the Loyalty Coupon if they keep track of the individuals that Check In to their business at the register, I say small because if you have a just a few hundred people Check In to your business, you can keep track to make sure they are all really buying something from your business every time they Check In. Ultimately though, Facebook needs to create a device for businesses to like Bump your phone that will let the businesses manually Check you In for the their Loyalty Coupon, so people don't abuse it. Their are 4 different types of Facebook Deals, and all retail/restaurant businesses can utlize at least one on the Facebook Deal Coupons, so this will be widely successful and used on a daily basis like Facebook already is.

2. Jonathan Trenn says:

   February 4, 2011 at 10:44am

   I'm with Webster. Even more so. Here in Northern Virginia, a tech haven filled with professionals, one can barely find a deal, an offer, a special of any kind via FourSquare, Gowalla, or Facebook.
   
   It's not merely a matter of time, it's a matter of the culture of small business and making a concerted effort to educate them on mobile. Most have no clue that any of this exists. No clue.
   
   The decision makers in these places don't read the pubs that we do. They work at their jobs. Period. I mean, I see a ton of restaurants that have a Facebook "profile" (as if they were human) and not a "Fan Page". Now we see that they also need to put up a "Place" thingy. Huh?
   
   Look, in theory, it's a great idea. But in execution and in actual, well, "engagement" with the small business community, it's failing at this point. I wrote my thoughts on this topic a couple of months ago:
   
   http://digitalstreetjournal.com/wordpress/?p=434

3. Ron Schott says:

   February 3, 2011 at 1:04pm

   @Travis - You've got a good point. I don't think brands, or Facebook for that matter expect to be marketing to a target group of 500M. When GAP did the very first Deal, they had excellent pickup around the country - jeans flew off the shelves and that worked for them.
   
   You mention brands no one cares about, but it's small/med. businesses that make this country run in many communities - those are exactly the types of businesses that can stretch their dollars by using something like this coupled with targeted engagement advertising.
   
   @Ken - If it's anything like most existing LBS apps, you can truly only check in once per day.
   
   @Webster - You've got a point. I do see more Foursquare Specials out there than Facebook Place Deals, but at one time there weren't that many Foursquare Specials either... time, my friend.

4. Webster Lewin says:

   February 2, 2011 at 7:04pm

   If Facebook Deals is such a compelling marketing platform, I wonder why so many businesses are using Foursquare Specials and not Deals. I've not seen a single Deal in New York or New Jersey since December, and I see Specials around everywhere.

5. Ken Burgin says:

   February 2, 2011 at 6:00pm

   An issue for venues who offer loyalty deals: what stops me 'checking in' 9 times outside, then sitting down for no. 10 and claiming my reward?

6. Ron Schott says:

   February 2, 2011 at 2:03pm

   Thanks for commenting!

7. Travis Isaacson says:

   February 2, 2011 at 1:47pm

   I agree with many of the comments here.
   
   There is one more issue to consider: not every merchant wants to offer a discount to 500,000,000 people. In fact, the good ones really don't.
   
   Prediction: Facebook will strike a couple of big, national deals to get the word out and the hype going but the majority of the offers will be for businesses that nobody really cares much about with offers that are less then motivating.

8. Ron Schott says:

   February 2, 2011 at 11:41am

   @Jonathan - You definitely can. Any info you have in your Places Info section shows up (under the Info button) on the Places check-in screen. Excellent question.
   
   @Leslie - That's a good point. Those check-in aggregation apps are a different breed. That will all depend on what access they have to the Places/Deal API and how they choose to handle.
   
   Cheers,
   Ron Schott
   Spring Creek Group

9. Jonathan Madnick says:

   February 2, 2011 at 10:54am

   Can I provide a link to my mobile web site from Facebook places, and by this means entice a user to go to my site.

10. Leslie Chan says:

    February 2, 2011 at 5:24am

    I wonder how this will affect universal location-based marketing platforms like Geotoko that claims to be able to do foursquare and facebook places at the same time. Have you guys looked into it? Here's the company URL: http://geotoko.com