With the launch of Facebook Deals, the social networking giant is about to make Advertising managers of all of us (and potentially at the same time transform the marketing industry for ever).
I blogged last year about the rise of location-based social networking, Foursquare: Social meets business, and what opportunities existed for sites like Foursquare if they linked their services up with retailers and the world of commerce. Since November, Facebook has been trialling a new “Deals” offering in the US, alongside their location-based “Check-in” service. This has seen users checking-in to claim discounts and rewards at nearby retailers.
This is exciting for retailers, because for the first time it brings mass-market audiences within cost-effective reach of local advertisers. If I own a deli, I can define my own offers, and make them available to users who ‘check-in’ close to my location. My advertising becomes highly targeted and I don’t waste money advertising to people who can’t access my product.
With over 500m users worldwide, and 26m monthly users in the UK alone, Facebook has a massive advantage over the existing location-based networks in terms of reach, and one other very powerful advantage: The deals you take up will be published in your newsfeed. So effectively you will be promoting the deal to your network of friends.
It is this aspect that challenges the thinking and approach of traditional advertising. If the brand (or its marketing agency) can effectively get us to do more of their advertising for them, the better the returns are on advertising spend. We’re far more likely to take note of friends buying decisions than those suggested to us in any form of advertising.
It is this tapping into the power of advocacy with our social graph that is the prize that many brands have dreamed of, but has up until now always seemed at odds with the ‘social’ nature of most of our interactions in social networking (I don’t want to be advertised to while I am catching up with friends!) However, connecting Deals and Check-in, and linking it to the newsfeed, could transform location-based marketing for ever.