December 17, 2012, 4:46 PM

Facebook adds friends’ ratings to a mobile/local search feature

Stores with pages that contain geocodes and recommendations pop up in its mobile app.

Lead Photo

The Facebook mobile app's Nearby feature highlights the pages of businesses with recommendations and Likes.

Good word of mouth can make a business thrive. Facebook Inc. is playing up word of mouth in the latest update of its mobile app, enabling businesses with Facebook pages that contain geocodes and good buzz to pop up in the Nearby feature of the app. There an app user can read recommendations and star ratings. A geocode is a precise location used by satellites, enabling marketers to offer consumers services based on their location.

Facebook says 150 million consumers globally visit business pages on Facebook every day, and in the U.S., more than half of those consumers are on mobile devices. Now, in addition to showing which Facebook friends have checked in at a location, Nearby helps a consumer discover places near them based on friends’ recommendations. When a consumer looks for a place, the results that appear in her Nearby list are based on factors including her friends’ recommendations, ratings, check-ins and Likes.

“If you’re a business with a physical location, update your page to include all of your basic information, including your address, store hours, phone number, and details about your business in the About section,” writes Sue Young, Facebook Product Marketing Manager, on the Facebook blog. “Update your category to make sure you appear when people are looking for your specific type of business. And encourage your consumers to Like, check into, rate and recommend your place.”

Consumers can explore through Nearby by category, including Shopping, Restaurants, Coffee, Nightlife, Outdoors, Arts and Hotels. They can connect with businesses by Liking, checking in, calling or getting directions. They can rate the places they visit via a five-star system. And they can share their recommendations with friends.

“This shows how important it will be for retailers to have a Facebook page for every store, and to make sure they keep those pages fresh and maintained so that people Like the page,” says Nikki Baird, a managing partner at Retail Systems Research LLC. “Otherwise, retailers may miss out on an opportunity to give digital life and exposure to a bricks-and-mortar store—the one distinct advantage that chain store retailers have over the likes of Amazon. The aspect of seeing what your friends have liked and exploring in effect personalized recommendations that result from that information is what makes this the most intriguing to me. It will either work spectacularly well, or it’ll wither for lack of content.”

Nearby is a feature of the Facebook app that is available in versions for devices running the Apple Inc. iOS and Google Inc. Android mobile operating systems.

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