Hello Fresh is in the first wave of internet retailers taking advantage of Facebook Offers, the social network’s new discount platform. The deal, which launched 23 April, gave new subscribers a £20 discount code. Within 24 hours, over 200 Facebook users had claimed the offer from a captive base of just 2000 people liking the brand.
Facebook soft-launched Offers on 29 February. The service allows local businesses to use their Facebook pages to promote products, with freebies and promotions sent straight to users’ news feeds. The social network is banking on the feature being more successful than its ill-fated predecessor, Deals, which was abandoned towards the end of 2011.
Offers simplifies redemption
Hello Fresh – which delivers recipes and all of the required ingredients directly to customers’ homes on a weekly basis – was one of the first to adopt Facebook Offers as a promotional tool. The company feels that Facebook has taken a big step towards simplifying the customer experience for online deal redemption and effectively monetising the network’s vast userbase.
Yipit analysis showed that in Q2 2012, coupons sold per subscriber fell by around 25% year-on-year in one of Groupon’s oldest markets, Boston. Pit Karbe, Managing Director of Hello Fresh, believes this to be evidence that the effectiveness of online coupons in mature markets might be falling. “As a young, growing business, Offers provides us with a great, cost-effective way to reach new customers interested in our service,” he explained. “Leveraging a potential customer’s social network has been much more effective than other mass-distribution models.”
Larger sample sizes key
A4u spoke to VoucherCodes.co.uk’s co-founder, Max Jennings, about how voucher redemption rates were faring and his thoughts on Facebook Offers. “The [Hello Fresh] voucher redemption rate is strong and seems to have been a success, but it will be interesting to see the experiences of larger groups as they adopt the service, as this is a relatively small sample size,” he told us. “Ultimately Facebook Offers provides an intuitive way for retailers to directly market discounts to their customer base beyond traditional email marketing or offline by posting promotions.”
Using Facebook’s ability to allow customers to opt-in to the brands they receive offers from might counteract the alleged falling effectiveness of coupons. Hello Fresh feels that the online advertising landscape could be transformed, with Facebook enabling offers to spread organically via word-of-mouth and putting more control into the user’s hands.