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foursquare: The arrival of the location based business “game”

I’ve been on this huge kick of creating visibility for products online lately. All I can think about is how to gain visibility for an online brand. Along with that, I’ve been really interested in two other things: Local and Location Aware applications. I’ve had my eye on Yelp for a bit, but even more so lately as the mobile market is growing. But, even more than Yelp, I’m a huge fan of foursquare since I jumped on the bandwagon back at SXSW. Something I really like is that, like any smart business, they are adapting the product to the market and use. They’ve created a product that included Social Game features and recently launched foursquare everywhere. Now, don’t get me wrong, Yelp adding checkins could totally change the face of the game and knock foursquare out of the Mayor spot, so-to-speak (I had to do it!).

So, that all said, it’s important to note, that I wanted to take a look at foursquare from a perspective outside what everyone else is talking about with how cool the app is, but rather, talk about how it is great for marketing/monetization opportunities going forward.

1. Building Social Capital with Mayorship & Badges

As I mentioned opening this up, they added social gaming to the local mix and understand that social capital is an asset that is ever so important in todays

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online world. With the creation of Mayors and Badges, it creates an opportunity for individuals obtain a larger amount of social capital within their local cities/neighborhoods.

As a local business owner, wouldn’t you want to know who the people are that frequent your business and have an online presence. I know I would if I was a local business owner, I’d want to know who the people are that have the ability to talk up my business.

We’ve all heard Tara Hunt talk about The Whuffie Factor, and, it’s all very true, social capital is very important now and will continue to be moving forward. I think as local businesses understand that, they will start figuring out ways to market via channels like foursquare. Furthermore, smart local marketers will start figuring out ways to leverage foursquare when working with clients. Also, think about all the chain restaurants that have the ability to build this as a nationwide local targeted marketing initiative as more and more users adopt this.

2. Local Advertising with a real revenue model

I’m a marketer and I look for revenue models as a sign of a product taking that next step into the major leagues. I see foursquare having a major opportunity to create sponsored events, sponsored or featured locations, etc.

Now, before you say, “Why would they do that! Businesses paying to be listed is not authentic!” Think about it, when banners on the web came out, people threw up their arms, when Google Adwords came out, people yelled from rooftops, and when ad.ly (one of my fav. startups, btw) came out, people were outraged via Twitter…do you see a pattern??

It is inevitable for sponsored and premium/featured listings to be highlighted within the content that we see on a daily basis. Saying that it is evil and not right, is thinking without logic. Businesses can not live on without REAL revenue models. Here is how I could see something like this playout:

3. The ego is more important than you think

I’ll bring up Mayors and Badges for the second time in this post because it is worth the mention again. I think something we have failed to see in most Social Media products is the ability to touch the human Id and ego boosting. While we choose to ignore it and pretend it doesn’t exist, it is the base for all human activity. When we feel better about ourselves through any sort of ego-stroking, we tend to do that activity more: championships and trophies in sports, awards in entertainment, etc. Gaming companies do a great job of this, and you have to give credit to Zynga for recognizing this and on their platform with Mafia Wars and Farmville:

But, look at other Social Media platforms, Digg removed it’s top diggers list years ago because they didn’t want the users having more power than the product. Twitter has yet to introduce any sort of ego-boosting platform, (outside of the retweeting functionality), and Facebook really doesn’t have any way of producing this either at this moment. But, introduce foursquare in the mix and you’ve got a real tool for ever so important ego-stroking that we all choose to ignore. Becoming a mayor makes people feel self important, it provides a feeling of self

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worth. We shouldn’t think of it as a bad thing, it’s human nature for christ’s sake.

Whenever I tell people about foursquare, the first I find friends get excited about: becoming a mayor or getting badges.

4. Capturing local search results:

Being that I’m someone that understands SEO and the search game, I’m always going to look at opportunities to drive traffic. Now, while Yelp does have this market pretty cornered, as they have tons of authority in the local/review market, within a short period, I’ve seen foursquare locations show up top 10 and even top 5 in many situations for local results:

5. Customer Service has never been more important!

Consumers are now subconsciously advocating companies or they are talking about their complete dissatisfaction for another company. Remember, more than 50% of people will make a purchase or purchasing decision based on the reviews of that brand. If I see someone checkin via foursquare is talking about how horrible a location is, I’m probably not going to want to check it out. At the same time, if people really enjoyed their experience, it will make me add it as a to-do item in Foursquare.

This basically is the flip-side to what I talked about when it came to local/in-stream advertising. Customer Service is ever so important, because, even if you are paying for prime placement and top dollar for sponsorships, you can’t fake the overall customer experience.

The truth is, without even knowing it, consumers are becoming what I’ve dubbed: “Subconscious Advocates.” Consumers are revolutionizing the way they tout the brands, restaurants and shops that they love via the tips they leave or the shouts they make when they check-in to a location. Because of this, businesses need to create opportunities to “wow” these customers and influencers daily, otherwise, I believe they will start to feel it as the market starts to adopt these services more and more.

What do you of the location aware model and/or foursquare? Where do you think it will end up or how will it play out?

Keep the conversation going on twitter, follow me: @tonyadam!

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  • Sean Godier

    I agree that the potential for businesses to market to their customers via foursquare is high. The ability to send a special offer (and a GOOD one) to foursquare users could be powerful and create additional customers.

    However, I think that people overestimate the number of ego-centric/self centered folks out there. I could be completely wrong, but there aren't a ton of places where this site/game will capture a huge presence. And I think that even then, it's a novelty. Do most people really give a crap if someone 'checked in' at a location or became the mayor? Probably not.

    Then again, people said about Twitter too.

  • http://twitter.com/RickWolff @RickWolff

    I hear it works outside of California. Don't go by me.

  • http://thedreaminaction.com Ryan Graves

    Great post Tony. Especially love the Featured ideas…you're so right that what people originally freak out about, they will later praise, and potentially find necessary.


  • http://twitter.com/chiropractic/ chiropractic

    I've been studying FourSquare (as local business owner and user) for several months, while I have fairly good use in the LA area, I was really impressed with how some users in Las Vegas are using the service. I was visiting during the past 2 weekends and when you are on foot outside a casino for example, getting a notification of a promotion or special nearby seemed inviting to me.

  • http://pegshot.com Christian Sterner

    It's totally understandable for people to believe that local businesses would love this type of tool to talk to their peeps. But, having played the local media game for a long time, it is cold hard fact that selling local business owners on the idea of an ad platform is a relationship sale. In other words, good luck getting scale in the local ad market without a bricks & mortar sales team. I hear you in regards to chains, just don't buy the idea that local business owners would seek out niche platforms to hand over their cash. They are busy people and will trust the person that spends time with them in person, with very few exceptions. To this end, check out Reach Local (no affiliation with this company): I think they are well positioned to sell the tools that you are referencing in our post. My bet is that location-based media plays (even the ones that I am working on) will at some point partner with a company like them.

  • http://twitter.com/eclairebears @eclairebears

    Thanks for the insight, Tony. Businesses have a lot of potential they can tap into as this space grows, it's still relatively small and isolated to urban areas. I've seen a handful of places mentioning – "show me that you're the mayor for a free xxx" and get excited to see this – I know more people will catch on and the businesses taking advantage of it early will reap the biggest rewards.

  • http://www.clairefy.com Claire

    Thanks for the insight, Tony. Businesses have a lot of potential they can tap into as this space grows, it's still relatively small and isolated to urban areas. I've seen a handful of places mentioning – "show me that you're the mayor for a free xxx" and get excited to see this – I know more people will catch on and the businesses taking advantage of it early will reap the biggest rewards.

  • http://twitter.com/eclairebears @eclairebears

    Thanks for the insight, Tony. Businesses have a lot of potential they can tap into as this space grows, it's still relatively small and isolated to urban areas. I've seen a handful of places mentioning – "show me that you're the mayor for a free [insert free thing here]" and get excited to see this – I know more people will catch on and the businesses taking advantage of it early will reap the biggest rewards.

  • http://www.webconnoisseur.com/blog/ Dustin

    Great post Adam. I know a lot of people in the Seattle-area who are addicted to foursquare – I've been holding off from playing because, from an outsider's perspective, watching people stare at their phones and shouting out in glee that they are the mayor of some tiny restaurant seems incredibly dorky, but I love how it adds a new layer to local & you raise some great points about the potential. I'll be trying it out this week.

  • gtechie

    Great that you featured the Endup! :)

  • http://www.orvilletadle.com/itcsales ITCSales

    4square is rockin the whole internetsphere specially in twitter…. Most people (Non-americans) are curious on this feature actually. My first glance looks like a spam links.

  • http://www.online-marketing-business.info Business Marketing

    I'd love to see more filtering options as well. Been using the service for a few months, mostly to discover what potentials it has for the local market, such as who is checking in at my business location.

  • http://outspokenmedia.com/social-media/foursquare-believer/ Then I saw Foursquare… Now I’m a believer

    [...] sure going to be ME. And so, I became a Foursquare user. Tony Adam blogged a while back about the possible monetization opportunities Foursquare has. But, I’m not looking at Foursquare from a small business owner’s [...]

  • http://www.convenientcalendar.com Stephen

    I just started Foursquare and I think it is going to be provide excellent market research.

  • http://mobile-marketingnow.us/?p=2915 foursquare: The arrival of the location based business “game … | Mobile Marketing Now

    [...] foursquare since I jumped on the bandwagon back at SXSW. Something I really like is that, … foursquare marketing – Google Blog Search This entry was posted in Mobile Seo and tagged arrival, Based, Business, Foursquare, Location, [...]

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