Marketers see potential in Facebook Places

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Facebook unveiled a location-based check-in service August 19, giving marketers and advertisers a potential new way to reach consumers via the social network.

Facebook's “Places” will work similar to the two main players in the space, Foursquare and Gowalla. The new feature allows consumers to share where they are and what they are doing, as well as find new places through their mobile devices. They can also opt out of the function.

The launch is good news for marketers who want to build customer loyalty but only in the long-term sense, said industry experts.

“It's going to take a little bit of time for this to be adopted by users,"said Augie Ray, senior analyst at Forrester Research. "At first it's only available to advanced smart phone users. This isn't something that's going to change the social habits of a hundred million people in the next six months.”

However, Ray added that Facebook continues to gather more information about what people do and where they are - critical data for marketers.

“What I find interesting is where people check in says even more about what they like. Now we're actually looking at their real-world behavior, instead of just a button they click on a website,” he said. “I think this really will continue to help Facebook offer much better targeting and permit marketers to do a better job of understanding their consumers and targeting ads at those consumers.”

The very scale that Facebook Places creates is a welcome event for marketers, said industry professionals.

“I would say this is a tipping point for geo-marketing,” said Lawrence Kimmel, CEO of the Direct Marketing Association.

Kimmel noted that Foursquare is leading the charge on geolocation but emphasized that Facebook could have a bigger impact given the sheer size of its audience.

“Now, you're taking this interesting strategy and you're making it available to a community of over 500 million people," he said. "So in a nano-second, the availability and the awareness of this strategy has been transformed."

Maria Mandel, VP of marketing and media innovation at AT&T Advanced Ad Solutions, agreed that the service makes geo-marketing much more mainstream.

“It certainly brings location-based social media to the mass market," she said. "It validates the relevance of the location-based check-ins and may offer substantial new opportunities for advertisers.” 

Leveraging location may prompt innovative promotional campaigns, such as scavenger hunt contests, Mandel noted. There is also the scope to build long-term loyalty programs by rewarding people for checking in at certain locations to build toward prizes, offers or discounts, she said.

David Berkowitz, senior director of emerging media and innovation at digital agency 360i, said that marketers will be able to promote their business locations similarly to how they have promoted their Facebook pages. Marketers who have bricks-and-mortar locations will want to experiment, particularly as Facebook has a low-barrier to entry, as far as cost and learning curve go.

“Once marketers are able to claim their places and promote them – the question for them will then be: how do they effectively use these pages – just to acquire new customers or build more loyalty from their existing fans?” he said.

Berkowitz added that the latest Facebook initiative may lead the social network further into mobile marketing.

“What's going to be really interesting to see is if this becomes the gateway for Facebook doing more with mobile marketing. It really hasn't,” he said. “Facebook has over 150 million mobile users worldwide, [but] no real way to market to them. So, that's a big thing that marketers are still waiting for.”

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