What we needed, Groupon, LivingSocial get Scared the Monster of Facebook is coming with all the power! Love it!
On Tuesday, Facebook began signing up users for Deals, its answer to Groupon and other group-buying services. Subscribers will receive updates in their news feed and potentially by email about pre-paid coupons and experiences they can purchase. Businesses can work with Facebook’s Merchant Services team to arrange and promote Deals such as discounts on going out to a restaurant, the movies, or a wine-tasting tour.
Instead, the new Facebook Deals is indeed a competitor to Groupon, and doesn’t require users to share their location. Instead, they’ll be able to share the news of their purchase. Facebook can increase at will the EdgeRank, or news feed visibility, of both initial updates about Deals and these user shares about purchases.
However, users have grown to love the news feed because it shows them what they care about, not ways to spend money. Deals could be both, but Facebook must make sure not to place low quality offers above important updates from friends. Otherwise, it risks reducing the news feed’s perceived value to users, which could negatively impact the site’s long-term engagement rate.
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