Will Facebook's Local Deals Mean The End of Groupon?


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Facebook just keeps on expanding its reach, and these days the monolith of social networks is increasingly taking inspiration from other successful tech startups. Soon after Foursquare introduced the idea of “checking in” to specific locations using your phone, Facebook unveiled a feature called “Places,” that allowed its users to do just that. Now the social network is challenging local coupon sites like Groupon and LivingSocial with expanded Facebook Deals offerings.

“Buy With Friends,” a program Facebook initially debuted in San Francisco in January, will do just that — allow people to “buy deals on Facebook and share them with their friends.” The service will soon be tested in five cities: Atlanta, San Francisco, San Diego, Dallas, and Austin.

Facebook plans to both land its own deals with retailers and incorporate deals from partners like Gilt City and Plum City, reports Bloomberg News. The offerings are meant to play a big role in Facebook’s social environment — not only can users prompt their friends to opt in to the same deals, but the offerings — dinners, events — are all group oriented as well (so you can enjoy them with your friends).

As Facebook’s director of local operations, Emily White, told the Financial Times, “You won’t get your legs waxed with friends. You dine out, you go to concerts, you do outdoor activities. We want to make sure those experiences are maximized.”

Facebook execs clearly took note when Groupon recently turned down a $6 billion acquisition offer from Google. And Facebook bigwigs are likely aware of the much-discussed projections by consulting firm BIA/Kelsey — namely, that the group-deals market could reach $3.93 billion by 2015.

It’s too soon to say whether or not this development means curtains for other local deal sites — it may depend upon just how loyal customers are to their web coupon purveyors.


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