Facebook Joins the Data Land Grab At Retail
Last week Facebook announced a deal with Cisco to provide consumers free wireless access at locations where they log-in via Facebook. The platform has already been tested with select regions and small businesses over the past year, but now the two companies are approaching larger retail and hotel chains with the idea. The value exchange for the consumer is simplicity and free access. As Reuters describes the system, users will not go through the usual WiFi log-in, but instead use the ubiquitous Facebook log-in that then leads to a check-in at the local merchant. This opens up WiFi for the customer. In essence, it trades access for a check-in.
The plan is pretty darn smart in the way it trumps other local social check-in service like foursquare with an inarguable value exchange. As much as I find the check-in behavior detestably slavish, this model at least makes the process genuinely relevant to the user. I always felt that the mobile check-in was the height of startup hubris – an insistence that people develop new and unnatural behaviors simply to serve the business model of twentysomething Stanford grads and the VC backers.
Facebook is getting into the same WiFi access game as Google, which is helping to power Starbucks. But in this case the company isn’t underwriting the platform so much as making it easier for consumers to log in, and giving the relevant merchant a greater toehold on that consumer via social media. The check-in gives the retailer an update in the consumer’s news feed. This deal is designed to help Facebook take its massive mobile footprint and localize it.
The deal also promises to give Facebook more local data. It also enhances its pool of resources and data for its local discovery tools. As TechCrunch points out, Facebook is not really funding free access so much as smoothing the process of logging into it and giving the sponsoring merchant a greater exchange. Users actually can opt out of the Facebook login and publish their check-in as a status update, even though it takes some tech sophistication to do so.
But it also underscores where much of the data war will be fought: over that last 100 feet between the user and the cash register. It is not just a matter of those overhyped and feared “Starbucks moments” when passersby get pinged with ads by geofenced companies. Instead, the larger value is in getting much more detailed maps of consumers’ physical patterns, movement through retail outlets, relationships among live and online encounters with a retailer on the path to purchase. This is the stuff on which mobilized social networks like Facebook and Twitter will really build their future business models far beyond mere advertising.