Facebook begins testing social-buying program

The social-networking giant's effort to cash in on daily deals mania, Facebook Deals will begin testing in Austin, Atlanta, Dallas, San Diego, and San Francisco.

A Facebook Deals offer for concert tickets in Austin.
A Facebook Deals offer for concert tickets in Austin. Facebook

Facebook announced this evening it is ready to begin testing its new local deals offering--the social-networking giant's effort to cash in on the feverish interest in social buying.

First revealed in March, Facebook Deals offers members local deals they can buy and also share with their friends on the network. The test will launch tomorrow in Austin, Atlanta, Dallas, San Diego, and San Francisco, but may be expanded to include other cities, the Palo Alto, Calif.-based company said in statement today.

Users in the five test cities will be able to learn about offerings through e-mail and notifications, by clicking on the Deals tab on their Facebook home page, and through their News Feed when friends like or buy a deal.

Facebook is working with a passel of other deals sites in the venture, including Opentable, Gilt City, Tippr, PopSugar City, Plum District, ReachLocal, Zozi, Home Run, KGB Deals, aDealio, and ViaGoGo.

With 500 million members, Facebook brings a sizable user base in its challenge for dominance in the deals market, which brought in $873 million in revenue last year and could bring in $3.93 billion by 2015, according to a projection from consulting firm BIA/Kelsey.

Chief among those competitors is Groupon, which has been riding meteoric growth with half-price massages, discounted restaurant meals, and travel bargains. Chicago-based Groupon, with 60 million users and more than 39 million deals sold in its two years in business, is expected to beef up its muscle with an initial public offering later this year.

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