Earlier this week, Facebook announced that its ginormous user base will soon be able to buy real products with Facebook credits. Until recently, these Facebook credits were almost exclusively used for the purchase of non-tangible items such as software and, more typically, games.
Facebook credits are the site’s virtual currency and the addition of daily deals is sure to be a lucrative endeavor for the wildly-successful social networking site. Facebook is counting on users spending their virtual currency on the soon-to-be-released “daily deals.” If this sounds familiar to you, yes, this strategy appears to be a lot like Groupon’s niche market that has been carefully developed over the past eighteen months. Groupon and, presumably, Facebook’s answer to their popular strategy, work on the principle of collective buying power. Essentially, the website links groups of consumers to commit to buying a large volume of one specific product or service. In return, the retailer discounts the good or service with the knowledge of the commitment of monies to the goods purchased. In the end, retailers move more product from their inventory and individual consumers save money on products. However, many marketing strategists have suggested that this idea of “money saved” is not quite accurate. Without the tempting deal presented by Groupon, or by extension, Facebook’s daily deal, the consumer would have been less likely to buy a product or good they did not need.
Regardless of the consumer argument, the new Facebook service will employ popular payment gateways such as PayPal, credit cards, or the use of Facebook credits for purchase completion.