Sunday 18 July 2010

Foursquare - from check-in to check-out


Geo-location is a hot topic..and it's getting hotter.

Foursquare, one of the biggest location based social networks took 12 months to get it's first million users, just 3 months to get it's second and is reported to have recently secured an additional $20m in funding.  Brands everywhere are experimenting with it to see what it might offer from Barbie to Jimmy Choo, Starbucks to Dominos.

In theory location is the ultimate marketing mechanism - being able to target consumers when they are actually out and about, wanting to buy, and right by your store. The idea is nothing new though. Ever since the mobile became ubiquitous, agencies and brands have been talking about how they could connect a consumer to a brands physical location.

The (somewhat unimaginative) idea was that as I walked past a store I'd suddenly get relevant, targeted offers sent to my mobile - beckoning me in with their irresistible offer. The reality would be quite different though and would consist of being spammed with irrelevant offers from stores I have no intention of frequenting and a mobile that is buzzing every few seconds.

In one recent article, this idea was still being promoted, saying:-

Cell broadcast works by blanket-sending a message to a mobile phone cell or series of cells within a specified location. The applications for this are endless.  Food chains could text everyone in a shopping centre with their latest offers and details on how to get to their concession stands.

The problem with this original premise is that geo-location is being treated like traditional push based mass media.  A marketing message needs to be delivered and it gets delivered where the potential audience is greatest - or is pretty close by.

The difference with tools like Foursquare is that they are much more collaborative.  More pull than push, consumers choose who to interact with and when.  Brands providing something relevant are rewarded with interactions or check-ins.  Consumers choosing to interact are rewarded with offers, tips and occasionally meeting old friends or making new ones.

However I know from the flack I get from others for checking-in all the time that Foursquare in it's standard form will probably not appeal to the masses.  Chasing badges just isn't going to cut it for many people.  Foursquare are not resting on their laurels though - following the tradition of Facebook and Twitter, they have opened up their platform to developers to allow applications to be built on top and it is probably this more than anything which will really open it up to the masses.

In an interesting blog by Chris Dixon, he describes how this progression works with technological advances building on each other - forming a stack - so Intel chips -> PCs - > Windows.  With regard to location marketing, GPS enabled devices have allowed for services like Google Maps, leading to utilities like Foursquare which connect people to places.  The use of applications on top of Foursquare is just the next natural step.

So whats in it for brands?

Well for the moment, it's more of a one to one conversation between the consumer and the brand with many brands not even listening yet.  Those that are listening are ahead of the curve and are starting to build a dialog with customers - rewarding them with offers, discounts or simply the knowledge that they are listening.

However, as the networks grow and the tools which sit over these become more useful, brands will benefit from implicit advocacy as consumers see their friends frequenting different places and choose to follow - turning advocacy into footfall or check-ins.  In fact, Foursquare see this ability to allow peoples check-in's to drive footfall as a key area of growth with co-founder Dennis Crowley saying:-

We can anonymise data and use it to show venues trending at that moment. Twitter helped the world and the search engines know what people are talking about. Foursquare would allow people to search for the types of place people are going to – and where is trending – not what.

If results from early adopters like Dominos or Jimmy Choo are anything to go by, brands are then free to start a dialog to turn a check-in to a check-out.