Facebook’s latest local venture – breaking into restaurant reservations

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Facebook has been hard at work to make their mobile pages more valuable to both consumers and businesses. The latest enhancement, which comes from their partnership with OpenTable, lets users make reservations on their mobile device, when visiting a restaurant’s Facebook Page. Reservations can now be made at nearly 20,000 U.S. dining establishments without ever leaving Facebook.

By improving the usefulness of pages, Facebook positions itself to gain a large market share of local search business.

Currently, most users first thought when searching for making restaurant reservations is to go to Yelp, Google, or directly to OpenTable. By offering the ability to book a reservation directly from a restaurant’s Facebook page, Facebook is setting itself up to compete with these other industry staples.

And the functional opportunity isn’t limited to restaurant reservations. Yelp is already pursuing functionality to book home services through their site. Google implemented hotel finder a few years back. Further Facebook enhancements and partnerships could provide reservation systems for hotels, hair salons, and other service based companies. And of course there’s the ability to purchase items directly in Facebook, which is a theoretical boon of ecommerce dollars for the social giant.

Of course, some would argue that the world’s best functionality is meaningless if Facebook can’t nudge its user base away from going to Yelp and Google for their local search needs. But, Facebook has already taken a strong lead in the local search market and is making discovery search even easier on its platform. Let’s look at some facts:

With all this working in its favor, Facebook simply needs to keep pushing forward on user engagement with any new business interaction functionality.

Once users adopt the new Facebook business functionalities, businesses will be able to better identify income generated from Facebook. This identification of social ROI is where I think the real value to Facebook comes in. As businesses are able to identify how much revenue comes through Facebook, they’ll be interested in spending more advertising dollars with the social giant.

Many businesses spend a lot of advertising money on Google, Yelp, Bing and other platforms currently. Facebook is hoping to steal away those advertising dollars, which would further shift the digital marketing industry from search to social. Facebook has the user base and engagement already, now it is just a matter of demonstrating real value to businesses.

Deanna Sandmann is the social media strategist for SIM Partners and Steve King is the company’s director of product strategy.

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