Hello, inevitability. Deals for Facebook launches today in Atlanta, Austin, Dallas, San Diego, and San Francisco, offering users the opportunity to cash in on city-specific discounts through prepaid vouchers. The Deals tab has been active in those cities since last month, but the actual discounts start rolling in today.
Somewhere out in Chicago, Groupon is kicking itself for not pulling off its IPO sooner.
Sure, Groupon had its share of flashy wannabes temporarily strutting their stuff. Beyond Amazon.com
Groupon broke away from the pack because it understood the viral nature of Facebook promotion. Where would the site be today without its ability to wedge its deals into Facebook user news feeds by incentivizing the original buyer?
Facebook is automatically Groupon's biggest threat, because it controls the same infrastructure that helped Groupon succeed. Facebook can better encourage users to enlist their sprawling networks of friends to go on outings together, and use deals to champion its Facebook Credits virtual currency.
Intriguingly, Facebook isn't diving into this high-margin niche alone. Instead of setting up specialized sales forces in its launch cities, the site has simply teamed up with OpenTable
Is Facebook outsourcing these deals as a first step toward taking such services in-house? That's an odd strategy, especially if it winds up promoting the niche-specific partner sites it employs.
OpenTable has been on a tear since it began selling marked-down vouchers for dining experiences last year. Travel deals publisher Travelzoo
Facebook enjoys a huge opportunity here -- even larger than when it took on Foursquare with local check-ins last year. Where the latter service simply stoked geek vanity, the social network's deals offer real discounts on desirable experiences, provided by the gatekeeper that every other social coupon site has thus far relied upon.
Make way for Deals. It's going to be huge.
Are you looking forward to the inevitable Groupon, Facebook, or LivingSocial IPO? Share your thoughts in the comment box below.
Google is a Motley Fool Inside Value selection. Google, OpenTable, and ReachLocal are Motley Fool Rule Breakers recommendations. Amazon.com is a Motley Fool Stock Advisor selection. The Fool owns shares of Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.
Longtime Fool contributor Rick Munarriz routinely checks the deal sites. He does not own shares in any of the stocks in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.
More from The Motley Fool
Even in This Rich Market, Gilead Sciences, Inc. Is Offering Investors Value
Here's why this biotech stock's single-digit earnings multiple looks more like an opportunity than a trap.
3 Top Small-Cap Stocks to Buy in December
Investors should take a closer look at Chuy's Holdings, Codexis, and Renewable Energy Group before 2017 is in the books.
US Concrete Stock: Buy at the High?
The leading infrastructure stock has soared to new heights in 2017. What's ahead for U.S. Concrete?