With the recent flurry of news and blog posts on mobile social networks like Foursquare, there is a sense that these networks really have a shot of taking this all the way. On Thursday, Foursquare announced that they had over a quarter million people “check-in”to some physical location in a single day. That’s pretty impressive, and while there has been hype around Loopt and Gowalla, there is a sense that Foursquare has the momentum to actually make something of this attention.
To take a quick step back, Foursquare and its competitors are services that allow people to broadcast out their location to their network. When you go to a restaurant or store, you “check-in” to that location, and do two things. One, you tell your friends that you at a specific place, and two, you let the store owner know that you are there. Why would you do this? Well, the most loyal person (most checked-in visits) can become the “mayor” of that establishment, and they get some bonus for being sucha great customer. Maybe a free coffee or pitcher of beer, as well as the social capital of being the mayor.
When we think about this from a branding level, this is some amazing data to have at your fingertips as a marketer. And all of this information is supplied by your customer, broadcast to his/her network and verified by GPS as being accurate. Couple that with profile data and incentives, and you have an army of bonafide brand ambassadors. And apparently, over a quarter million people are already putting their location onto the airwaves. Scary but exciting stuff.
I think what’s unique about Foursquare is that they are actively taking advantage of the current attention to their service to forge relationships with major media companies as well as with retail stores like Starbucks. In addition, as the Economist reports, there are a number of stars that have aligned to put Foursquare in the right place at the right time. The prevalence of smart phones, unlimited data plans, GPS accurate devices and a slew of applications that can take advantage of this information have put companies like Foursquare in the sweet spot of winning the race.
While I don’t believe that mobile social networks are going to become fully mainstream anytime soon, I do think that consumer facing companies should start experimenting with how they can use these tools to drive revenue and increase customer loyalty. According to the Economist article that I referenced earlier, “Juniper Research predicts that global revenues from location-based services could soar to $12.7 billion by 2014, up from $3 billion last year”. Even if this is an exaggerated figure, there is surely a sense that it’s worth playing a game of peek-a-boo with your customers to see if they are up for it. There’s a lot of money at stake here.