Facebook’s Deal

The single-best deal, assertion, investment or other strategy of the week.

Who: Facebook

What for: Giving the deals business a shot.

“While many Deals on Facebook offer discounts, it’s more important to us that you find interesting experiences around you to do with friends.  We’ve worked with partners and local businesses to help deliver the best social activities in your area.  And once you’ve found a deal you like, having the deal on Facebook makes it easy to share, buy and plan with your friends.
” —Emily White, Facebook

Facebook Deals launches in five cities to start, aggregates deals from several partners as well as its original sourcing, and aims to leverage its 600 million users’ social behavior to spread the word about the deals. Can Facebook really pull this off? Its other experiment in local, Facebook Places, has been lackluster. What’s more, it requires a sales force – something the social network is not known for. But if its theory plays out – that users will want to share deals – it has the potential to steal local deals away from other pure-plays.

Here’s what others have to say about it:

By partnering with HomeRun, KGB, etc. for deal supply, Facebook is giving up control over those crucial details. Mistake!
—Owen Thomas, DailyDot

With Facebook pushing deals on Facebook itself, users may become less likely to click on those “50% off your city’s best stuff” ads on the right that Groupon and LivingSocial have been using to drive new users. If so, Groupon and LivingSocial will have to find new ways to acquire users.
—Vinicius Vacanti, Yipit

Facebook made quite the momentous announcement. It has a lot of distribution to users for its service, so it’ll be challenging for Groupon. Facebook has a lot of traffic that they can drive to a deal offer that Groupon doesn’t have.
—Karsten Weide, IDC

What do you think of Facebook’s move? Post your view in the comments.

Street Smart Moves is published every Friday. If you have a vote for the single-best deal, assertion, investment or other strategy of the week, let us know by Thursday.

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