August 29, 2011, 1:08 PM

Facebook abandons Deals

The social network says it will end its daily deal offering in the coming weeks.

Zak Stambor

Managing Editor

Lead Photo

Facebook Inc. says it will shutter its Groupon-like discount offering Deals in the coming weeks.

Facebook Deals, which launched April 26, offered consumers in a handful of locations limited-time deals that focused on social experiences. For instance, a consumer in Austin could buy an “All Access Experience” for an Austin City Limits Live concert that provides backstage passes for two, sound check access, a catered dinner and tickets for the show.

Facebook says that it is refocusing its efforts on offering local businesses other marketing opportunities, such as its Marketplace ads, which recently began enabling advertisers to target consumers based on their ZIP codes.

“There is a lot of power in a social approach to driving people into local businesses, and Facebook remains committed to building products to help local businesses connect with people, like Ads, Pages, Sponsored Stories, and Check-in Deals,” says a spokeswoman for the social network.

Facebook will continue to operate Check-In Deals. That program uses a feature within Facebook’s mobile app to enable businesses to offer deals to consumers who check in to a particular location.

The social network’s shutdown of its daily deal offering comes amid signs of consumer fatigue with the daily deal model. For instance, traffic to the more than 50 daily deal sites tracked by Experian Hitwise is down 25% from its peak in the second week of June. Groupon’s traffic has fallen nearly 50% since the second week of June.

The exception to that decline is LivingSocial, which since the second week of June has achieved 27% growth in visits to its site.

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