Facebook going Places

1 Mar 2011

LONDON, UK: The announcement of the European availability of Facebook Places shows just how powerful the company's network and reach has become. Facebook Places does not seem remarkably different from Foursquare. However due to its limited network and utility Foursquare felt very much like an early adopter technology without much commercial potential.

Facebook's reach and popularity in comparison will inevitably ensure that this new service will have widespread pick up. It will also provide traditional retailers with a new level of customer segmentation that has previously been lacking. Until now retailers have not been able to access much detail about their customers in comparison to, for example, internet retailers. The ability to use a mobile as a loyalty card will change that, creating a potential wealth of information that could be used to create offers in the future and build deeper relationships with customers.

No revenue... yet

For the moment Facebook claims that it will not make money from this new service. It would appear the company has invested in a new technology without a clear commercial benefit. Again this decision reflects the strength of Facebook's network. Few other companies would invest in a new technology without knowing how it would deliver return on investment.

Aside from the benefits this will bring to retailers and Facebook alike, this new development does pose some interesting questions about the control of personal information. Many people create friendships on Facebook that they would not replicate in their so called real life so perhaps people will begin to question at what point a friend is not a real friend. Would you really want everyone you know on Facebook to know where you are all of the time?

About the author

Martin McNulty is general manager at Forward 3D, a digital agency that generates generate significant sales and exposure for over 200 clients across 30 countries, including Air France, Hilton and Virgin Atlantic.