Facebook, Cisco Target Local Business With Wifi Check-Ins

A Data Play to Allow Merchants to Advertise to Their Customers on Facebook

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Facebook wants more people to offer up physical location data at small local businesses. The lure is free wifi through its partner, Cisco.

Following a test period that originated last year at Philz Coffee locations in the San Francisco Bay area, 1,000 merchants across 50 countries now enable a wifi system with a Cisco backbone and Facebook consumer-facing front end.

The idea is simple: Allow people to use their Facebook logins to access free wifi in business establishments from mom-and-pop restaurants to international airports. The service provides Facebook with more location data to give to merchants, while giving Cisco and the merchants themselves an easy way for people to connect.

At this stage, the only significant retail brands using the service that the partners would name are Philz, MGM Grand Casinos and seafood eatery Bonefish Grill. Facebook wifi was piloted with 25 San Francisco-area businesses including Philz.

"This is a major step toward getting into the local space," said Erick Tseng, product manager, special products at Facebook.

The link to small and medium-sized businesses -- a key market Facebook has hoped to infiltrate for years -- comes through Meraki, a cloud-based wifi firm it's worked with for around four months, which Mr. Tseng suggested has a foothold in local markets. Cisco acquired Meraki in November 2012.

For now, Facebook will provide anonymized data about people who have checked in through the system to the individual merchants using it through its Facebook Insights tool. So, Philz could use Facebook analytics to determine the age range, gender breakdown, locations and interests of people who accessed wifi in its coffee shops using a Facebook login.

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Merchants using the wifi system can target ads to audience segments comprised of people who have visited their establishments. However, considering those audience pools may be relatively small, the data derived through the wifi check-ins is more likely to help advertisers get a better handle on the types of people who visit their stores. So, merchants are likely to use the added layers of data to help find larger groups of people to target via Facebook ads.

"That's probably the most leveraged thing they can do using the data," Mr. Tseng said.

Merchants can allow patrons to access the Cisco-enabled wifi without logging in with Facebook, said Mr. Tseng. People can also choose to keep their check-ins private or expose them to their Facebook friends, depending on their Facebook settings. Frequent visitors of a particular place of business can also choose to automatically check-in to that location's wifi via the Facebook system.

Facebook will not track any web browsing activity or any other interactions through the wifi system once people check-in to wifi spots through Facebook, Mr. Tseng said.

Facebook has found interest in the service among retailers, restaurants, conference centers, amusement parks, and even churches, he said.

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