A challenger appears: Facebook Deals launches in 5 cities today

Facebook has wandered into the group-buying fray, just days after Google Offers rolled out to five cities.

Facebook’s all, “well, we can roll out to five cities too, Google!” with the introduction today of Facebook Deals. Atlanta, Austin, Dallas, San Diego and San Francisco are the five cities to first receive Facebook Deals, to Google Offers’ Portland (Oregon), a part of San Francisco and three areas of Manhattan.

While Groupon is well established in a larger network of markets, Facebook has integration with its powerful social network on its side. According to the NYT, Facebook is banking on this connection-based leverage to pull out ahead with its group buying venture:

The company, which has more than 600 million members, said it hoped that its ability to tap directly into the communications and activities of networks of friends will help it offer a more compelling service than rivals. It will be easy to share deals with friends, see when a friend buys something and find offers that your friends are interested in, said Emily White, Facebook’s director for local. Facebook will focus on offers for things that are best done with friends, like concerts or events, she said.

But White also stressed the business model was not intended to directly compete with Groupon- the mega-bargain is less a focus than social experiences to share with friends:

“If your primary reason for doing something is getting together with friends, I don’t know if a discount is necessary,” said White. “We are not looking for the deep discount customer.”

The venture is notable as the first time Facebook Credits will be usable to purchase actual physical goods and services rather than virtual gifts or items within Facebook apps. Credit cards will also be an option to buy Facebook Deals.

Regardless of the effect it has on other group buying services, the introduction of Facebook deals does stand to open up significant buying choices to general group buying deal-hunters. Do you anticipate making use of the new service? Have you had any luck using services like Groupon to get deals?

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