November 3, 2010
As we’ve toured the country this year showcasing early stage startups and tech innovations, we’ve seen dozens of location based services and daily deal sites. Groupon and LivingSocial have been the talk of Chicago and DC while other local deal startups have been positioning themselves to coat-tail off of their success and notoriety, finding unique ways to differentiate themselves. SCVNGR and Gowalla have also been blazing geolocation and local offer trails nationally from Boston and Austin respectively. But today Facebook launched Facebook Deals and it could really disrupt the momentum of any startup trying to build a business in the daily deal arena.
This past August, Facebook make a big move into the geo-location space by rolling out Facebook Places, enabling anyone to check-in to a location. It was only a matter of time (roughly a month) before Facebook decided to use that local data to launch Facebook Deals. All it took was an update to its existing mobile application to roll out deals to all of its loyal Facebook users. So now users can check-in and see what local deals are around them in real-time. There are a number of local deal sites trying to play in this same space, but it may be only a matter of time before they become irrelevant.
To further strengthen its position in the social space, Facebook introduced Facebook Groups about a month ago and today it revamped its mobile experience to also include those groups. This is obviously disruptive to Twitter, Google Groups and any other multi-user chat application. Gary Vaynerchuk shared his thoughts on the move with us today as he has been watching the situation closely saying:
“It’s a big deal. This is going to have a large impact on local businesses.”
AllFacebook’s Nick O’Neill wrote:
“With a frictionless creation process there’s no doubt that this will transform small business marketing.”
The moral of the story is that Facebook has 500+ million users and has a clear roadmap to expose them to just about every innovation that comes to mind, making it difficult for any startup to stand out for long in this highly competivite space. That said, there is always opportunity to differentiate and specialize, and the global audience is always hungry for more. Just make sure you leverage the Facebook platform to make your product audience grow as fast as possible, similar to the way LivingSocial, Formspring or other startups have done. No matter what your business, keep your eyes on the Facebook Monster and be on your toes.
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