Facebook Doubles Down… Just Not in Deals
Facebook and news headlines go together like CPA Networks and claims of top offers or fast payouts; one just seems to come with the other. The question for Facebook is not that they were featured but what that feature focused on – IPO claims, user growth, privacy concerns, new product launches, social games, fan pages, etc. While criticisms of Facebook might occasionally occur, the one thing that people do not expect from Facebook is to hear of the company shutting anything down. This week, though, that is exactly what happened, not once but twice. The first bit of news focused on Facebook Places, which many like to believe is Facebook’s attempt to take on Foursquare. The second change impacted their just released Deals product.
The changes to Facebook Places occurred as part of the companies latest round of functionality changes. Generally speaking, the changes all revolve around privacy. Facebook and privacy have a slightly contentious past with the site often sharing more than users might have wanted and not creating intuitive or easily accessible controls to take ownership of one’s own data. Talk of privacy also gets lumped into any changes made to the company’s privacy policy. One type of change is functional, the other legal. This most recent privacy updatewas purely functional and quite extensive. It continued the momentum of earlier changes that offer users more granular controls of their Facebook identity – both in restricting what is shared as well as enabling additional data to be shared.
As mentioned, one such change in the recent Facebook functionality tweak focuses on Places – the primarily mobile check-in feature. Most stories though read into the news that Facebook was killing Places. AllFacebook corrects the fallacysaying, “It certainly doesn’t make sense that, after thousands of businesses had gone to the trouble to manually claim places as businesses and help Facebook identify duplicate listings, Facebook would just delete or ignore that part of their database.” In typical Facebook style, Places is being modified for greater use, shifting from being a mobile-centric check-in service to all data having geo data associated with it. Any post can have a location as opposed to just a push notification as a result of a check-in.
One business product that did actually die, though, is Facebook Deals, the straightforward daily deal service that Facebook created through a partnership with seven existing providers of deals. This “Groupon killer” is gone, but the notion of local deals and Facebook is not quite gone. Businesses can still offer check-in based deals, similar to what Foursquare has offered for some time. As for the generic daily deal service, the speculation as to what it actually means – for Facebook and the deals industry – is rampant, hardly any positive. Then again, why should it be. Given Groupon’s continued PR woes and the saturation of the deal space, it is much easier to point to issues with the deal space and/or read into the overall health and wellness at Facebook. The question of course, is whether or not either of those assumptions correct? Not ones to hold back opinions, here’s what we think.
The Deal Business Is Fine
Facebook killed deals not because of any issues with the deal model. That’s not to say that the deal model doesn’t have issues or major red flags, but those flags are not the reason Facebook has decided to exit (in our opinion). They have decided to exit deals, for now, because it is not core to their business. Deals are not a scalable technology play, at least not yet. They are the new Yellow Pages – a sales force intense direct marketing play. The company tried to put a social spin on deals, but the market just wasn’t there yet. Not only that, but the deals model is not self-service, and everything else that Facebook has for businesses large and small is self-service.
Facebook Is Doubling Down
The company killed deals to focus on its core and to protect against Google+. The search giant’s entry into the social graph must have caught the company’s attention. Even if they don’t feel it threatening today, that a company could gain so much traction so fast must have been a wake-up call. The company’s fingers are presumably no longer on the panic button, but a better product in many respects is out there. Most importantly, Facebook has long been associated with identity, and Google has almost directly said that Google+ is an identity play. Consumers are just one piece. If they can capture the business identity market, Facebook has a real threat on its hands. Their pages product is not slick, and it operates in a self-contained ecosystem. Google+ has the potential to not only create a better page but tie into Google search results. The chance to get more traffic from Google is a benefit of Google+ that Facebook cannot inherently address….so, it’s time to get busy making sure businesses (and users) will continue to dedicate themselves to the platform and allow Facebook to control their online identities.
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