Daily Deals Sites Face Off: Groupon & LivingSocial vs. Facebook

Daily Deals Sites Face Off: Groupon & LivingSocial vs. Facebook

We all knew it would happen. With the huge daily deal trend that Groupon and LivingSocial have dominated, it was only a matter of time before Facebook  jumped on the deal-a-day bandwagon.

Released Tuesday, the Facebook Deals page became available to Facebook users in Atlanta, Austin, Dallas, San Diego and San Francisco for a 'test run'. Users in these cities can see local deals very similar to those on Groupon, BuyWithMe, LivingSocial or Google Offers and pay with either a credit card or with Facebook credits.

Groupon and LivingSocial are currently the most popular in this online market, which gives consumers a local deal every day, ranging from restaurants to spas and more. Once these deals are shared with friends and enough people purchase them, the deal becomes valid and everyone who has purchased the deal gets it. Retailers who offer the deals to Groupon and other sites don't lose money by offering these discounted prices, because the deal only becomes valid if enough people share it and purchase it to make it worth their while.

This is where Facebook will probably take the lead. As Facebook already has over 600 million users, once Deals are integrated smoothly into the current Facebook interface, users will be able to easily share deals with friends and since each deal on Facebook promises to be something users will want to do in a group, such as wine tours or bowling (rather than teeth whitening or magazine subscriptions), it will be worthwhile to share it with your friends list, and perhaps even earn additional discounts for doing so.

You can currently view these Deals if you live in one of the 5 cities already offering it and go through the Places page. When you check-in by finding your location on Facebook, you will be notified of the current deals near your location. It is worth noting that this isn't a check-in based deal offer, much like Foursquare, but is rather a direct counterpart to Groupon and other similar sites, where you purchase a voucher for a discounted price.

This direct competition from Facebook with other deal-a-day sites like Groupon and LivingSocial can have several consumer advantages. It may push these sites into asking for lower prices from retailers to stay in the competition, meaning all of you will get better deals than are already offered.

So why sign up? For all of you deal-lovers out there, this means even more chances for you to find great bargains in your city. Companies and retailers like Macy's, which has just joined, are learning the advantages of offering deals on their goods and services, which means you get to reap the benefits with half off dinners and deals on skydiving classes with your friends.