Facebook Deals was rolled out four months ago to compete with Groupon. Now, Facebook has decided to shut it down. “After testing Deals for four months, we’ve decided to end our Deals product in the coming weeks,” Facebook told Reuters in a statement.
The concept seemed to be a good one. Facebook sought to bring daily deals to its over 750 million users. The product launched in San Francisco, Austin, Dallas, Atlanta and San Diego, then was made available in a number of other cities.
Other competitors have sprung up to do battle with industry leader Groupon. There has been some questions about whether this type of service can be successful in light of recent information about Groupon's financials.
“We think there is a lot of power in a social approach to driving people into local businesses,” Facebook said in its statement. “We’ve learned a lot from our test and we’ll continue to evaluate how to best serve local businesses.”
We think this decision by Facebook has to say something about the future success of Groupon and others in this space. If Facebook can't make this work with 750+ million users how can Groupon and the others expect to survive. What do you think? What do you think Groupon will have to do to survive?
