Location-based services are once again changing the face of social networking. Where relationships were once at the center of user experience, in the Golden Triangle of mobile, social, and real-time interaction, “places” take center stage and corresponding activities and rewards become the cast and crew of the production.
What started as a way to literally see and be seen, has now transformed into a universe where physical and online activity merge to improve experiences and relationships between people and also between people and businesses, services, and locales. We were lured into “checking in” through gaming and game theory. We earn points and badges for adding locations, checking into them, and also adding tips for other related activities worth consideration. But since then, the resulting culture and behavior emerging within these networks have rapidly matured into a microcosm powered by the 4C’s of commerce, connections, community, and content.
In a recent post by Marshall Kirkpatrick for ReadWriteWeb, he reviewed the top reasons why people check in to location networks. To summarize:
– Finding people
– Chance meetups
– Special offers and coupons
– Local tips/discovery
– People tracking
– Personal history/Diary
I would add one more. Whether it’s said or simply a subconscious act, it is the essence of social networking universally. People check in as a form of social currency and the resulting capital and the value we place on it is different network by network. As such, it governs how we interact with objects and one another and also defines our net worth based on how we earn, spend, lose, and build capital.
As in Twitter, Facebook, YouTube, and blogs, individuals are earning prominence through the tireless acts of earning visibility and community through interaction, content creation, and the establishment of goodwill by investing in the experiences of others.
The State of Local Social Networking
Facebook touts registered user numbers in the neighborhood of 500 million and Twitter claims over 100 million. However, with the amount of media attention given to Foursquare especially, one might expect a higher network of users, especially when local service providers are concerned. As of today, Foursquare boasts roughly 2 million users and Gowalla checks-in with somewhere around 350,000.
If you want to get an idea about the future of technology and society, pay attention to the left side of the adoption bell curve. It’s less about how many people are networking via LBS today and more about what it means for people and businesses at the local level and how the 4C’s become the hub for bridging digital and offline social economics.
Robert J. Moore, CEO of RJMetrics recently studied data related to Foursquare and Gowalla and published his research in TechCrunch.
Foursquare is acquiring new users at an impressive clip, averaging almost 13,000 new users per day over the last 30 days while Gowalla’s user acquisition rate hovered at one-tenth the growth with 1,370 users per day. Perhaps most compelling is Foursquare’s average daily growth rate, the number of new users in a given day divided by the total user population from the previous day. When compared to Gowalla, Foursquare is averaging a daily growth rate of 75%.
Location-based networks are measured by users and also by the number of venues contained within the system and the velocity of its expansion. At the moment Foursquare boasts 5.6 millions venues with Gowalla housing 1.4 million.
In most social networks as well as mobile networking, women rule. However, in Foursquare, 64% of users are male, 33% are female and 3% did not specify gender.
The Business of Checking-In
Local services are realizing, albeit slowly, that increasing visibility in the real world, on the traditional Web and now the social web, is an effective way of competing for attention where it is focused. Foot traffic, Yellow Pages, Google and Yahoo Search are losing favor to new forms of research and referrals. Yelp paved the way for social reviews and referrals, but Foursquare and the like are introducing trusted opinions and real-life networking into the mix that reward exploration and experimentation. Businesses can only benefit by playing along.
However, on Foursquare, 18% of the venues have at least one “tip” associated with them. Only 3% offer “specials.” 32% of listed venues have been checked into only once or never. Across Foursquare and Gowalla, the most popular venue names include:
– Burger King
Not only are businesses competing for the moment, they are also competing for the future. And with limited resources, identifying where to focus time and energy is paramount. What took Twitter some time to formally embrace, Foursquare is realizing that businesses, in addition to everyday users, are the beneficiaries of check-ins. As such, Foursquare is concentrating marketing and development resources to helping businesses compete for check-ins through specials, loyalty programs, campaigns, promotions, and events.
Businesses, if you read one thing in this post, CLAIM your business on Foursquare right now and read a bit about how to make the most of the service to increase your customer-base as well as increase loyalty among existing customers by introducing new and fun engagement programs.
Foursquare recommends offering:
– Mayor specials
– Check-in specials
– Frequency-based specials
– Wildcard specials
– Loyalty programs
– Variable ranges for nearby offers
These offers and lures carry across the mobile and social experience, extending your brand across social graphs on Facebook and Twitter through iPhone, Android, and Blackberry phones.
Foursquare also offers real-time venue stats for business owners to gather insight into their new “digital” consumers and spark creativity in campaigns and service programs. For now, available information includes:
– Most recent visitors
– Most frequent visitors
– Times of day for check-ins
– Number of unique visitors
– Histogram of daily check-ins
– Check-ins also broadcast to Twitter and Facebook
As The Brand Builder Olivier Blanchard asks, do you know who the mayor of your business is?
Making the Business Case
Foursquare provides window clings, as does Yelp and other services, to attract passerby’s. For example, Hampton Inn and Suites (below) and Whole Foods are among the many businesses proudly displaying the ability to check-in “here.”
While effective, this is only one of the ways a business can leverage location-based social networks for customer acquisition and retention.
The Bay Area Rapid Transit (BART) partnered with Foursquare to encourage transit ridership
Starbucks offered $1 off any size Frappuccino for mayors and as a result, observed a 50% increase in check-ins at its locations.
Monique’s Chocolates in Palo Alto acquired over 50 new customers and earned over 100 redemptions for its special of “buy one get one free” for truffles. Each redemption also equated to a 25% return ratio. In comparison, the chocolate shop ran an ad in a local paper and acquired only one new customer at a cost of $300.
AJ Bombers, a popular burger joint in Milwaukee, increased menu item purchases by 30% through its special promotions of free burgers for mayors and free cookies for adding tips. Also demonstrating creativity, AJ Bombers hosted the equivalent of a Tweetup for customers to help them earn Swarm and I’m on a Boat badges while increasing loyalty and sales.
Using Gowalla, the New York Nets hid free pairs of virtual game tickets throughout sports-related check in spots. These tickets could be exchanged for real game tickets as well as other prizes.
Through Gowalla, the Courier Journal, Kentucky’s largest newspaper, hosted a city tour and bar crawl during the Kentucky Derby where visitors earned special badges for following the guided tour.
While these examples represent only a few of the many ingenious and viral ways to attract and reward customers, the true promise of these portable social networks is the ability to bring to life online and offline relationships and experiences to unlock a city’s true treasures. Business owners, the question is, have you checked in?
Image credit: ShutterStock