Facebook announced their entry to the online coupons market today with the announcement of Facebook deals. Thats right Facebook will be going head to head with Groupon among others. The story was very well documented by Greg Sterling on Search Engine Land, but I just wanted to take a closer look at the potential value proposition and implications of Facebook Deals.

Value Proposition for Facebook

Facbook have really hit where foursquare failed to strike when the iron is out. Judging by the screenshots, anyone can set up a Facebook deal, hence pushing the sales and production back down the supply chain to the merchant.


Facebook will still no doubt employ a high powered sales team to find elite deals with big brands such as the Gap deal planned for November 5th.

Be one of the first 10,000 people to check in at Gap on November 5 receive a free pair of jeans.

Value Proposition for Merchants

Merchants are free to offer custom deals to a range of niches. Its almost like the Google PPC model. Merchants are free to specify the parameters of a deal, test the market, and discover the true popularity of their products. This could really help merchants in the following areas:

  • Get a better understanding of their target market. There may be a market that has been totally overlooked by the merchant.
  • Increase their reach and Brand awareness. Even without a conversion, being displayed on a deals news feed makes the consumer aware of the merchant.
  • Increase in sales and growth of customer base

Value Proposition for Consumers

Consumers have very little to lose with Facebook deals except obviously their hard earned cash J

What This Means To You

Everything Facebook has done of late has been geared towards the fact that Facebook on a smartphone is pretty awesome. Personally any time I spend on Facebook I am on my iPhone. The interface is smooth, you get to see what you want to see, or say what you want to say, and youre done. I think it is safe to say that Facebooks entry to the online coupon market has the following implications:

  • Geo location check ins are here to stay
  • Online coupons and deals continue to grow & are fast on their way to becoming integral to a successful online marketing strategy (especially for local business)
  • Even though people have become much more savvy with their money, we are still all suckers for a good bargain!

Deals only add another reason for me to check in when I am killing some time at a coffee shop or not quite sure what I want to eat. I check in and boom, there it is, half off burrito, decision made.