Facebook Deals, when launched in Nov 2010, allowed users, who "check-in" at a location using Facebook Places (on their mobile phones) to receive rewards and offers via their mobile device.
But now, Facebook is extending this to include offers from local businesses. Soon Local businesses will be able to sign up to use this feature, and people will be able to find Deals.
So how does it work?, And how will it be different from daily-deal market leaders Groupon and LivingSocial?
Well to begin with–All deals offered on the Facebook platform will be around “social experiences,” i.e. “things you can do with your friends”; how will users pay for these deals? … this is where Facebook Credits become useful!
To know more about How Facebook deals work? Check the following video
Facebook Credits has so far been used mainly for virtual goods, and occasionally for digital products, where Facebook currently takes a significant cut (30 percent) for the virtual currency, though Groupon and LivingSocial both take roughly 50 percent of the revenue for a given deal.
Deals also put Facebook on a collision path with Groupon and Living Social, in social commerce space, and with Google in advertisement space and income. Although it will be very hard for Facebook to compete with market leader Groupon, when it comes to social network, it has one huge advantage: 600 million+ users.
Important: Facebook/Social commerce has the potential to disrupt several business models. For example, Retail banking with augmented reality- How about a bank branch inside FACEBOOK?
Not a remote possibility, especially when we already have bank branches inside Wal-Mart’s and TESCO's. Any Peer2Peer or Mobile Service provider can offer all these banking services at the place and time of customers preference. It is important to understand that the business of banking is changing. In an interesting way, you do not need a bank license to participate in the banking industry ( e.g., M-Pesa, ZOPA, PayPAL). Will talk more about this in my later posts.
Update: 25 April 2011: Facebook launches Deals against Groupon and LivingSocial in five major cities. The Deals launch will also be the first major push for Facebook’s virtual currency, Facebook Credits. Users will use credits to purchase offers from its Deals service.
