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This summer Foursquare is looking to overhaul its services too boost revenue, check-ins
It looks like Foursquare is ready to gear-up its efforts to bringing revenue by going the way of Yelp and offering personalize coupons based on your spending habits and the suggestions of friends.
In an interview published today, Foursquare cofounder Dennis Crowley told the Wall Street Journal that the check-in based social network wants to start offering tailored coupons beginning in July. The news adds to reports that Foursquare’s new paid media platform is set to launch just one month prior, in June.
It looks like this new offering will allow merchants to buy special placement to push promotions for local deals and all users can see them, but much check-in to the spot to redeem. This is a crafty way to increase foot traffic to retail spots, increase the number of check-ins per location (and per day), all while likely boosting the revenue for retail partners. Not to mention, bringing more deals to the faithful Foursquare users that love to use their mobile apps.
Just three weeks ago, Foursqure buzzed right through the 20 million user mark and has hosted more than 2 billion check-ins to date.
You may remember when Foursquare broke through the 15 million users mark last in December, and just last month the company said the next milestone of 20 million was within reach.
Location-based services and check-ins took a while to find their way. At first a lot of people were interested in deals and gamification badges but were worried about privacy since they wanted more control over who saw where they were and when. Now check-ins have been folded into all social networking services and often come with their own perks, such as coupons at retail locations and connecting with people you have common interests with.
Foursquare was a pioneer in this field and, while it has taken longer to grow its pool of users, the company has been making some great partnerships with small businesses and big brands such as American Express. And with one of its biggest competitors, Gowalla, was snatched up by Facebook, Foursquare has had time to test out new services and build its platform to include restaurant deals, exploration and discover features and partner with communities to build awareness about events in the area.
The New York City-based company has raised more than $71 million in funding so far with the latest round of $50 million last June bringing the company valuation to $600 million.
While checking-in services still have a long way to go, a December 2011 study from Forrester Research found that just 5% of U.S. adults use any location-based check-in services, the growing demand for mobile payment services and loyalty programs that base their deals on location devices and check-ins may help push the trend further in to the mainstream.
I have no problem admitting that I am a Foursquare mayor 12 times over and would love to get real-world perks for checking in rather than just the badges that boost the endorphins in my brain. And it looks like this is just one prong of the multi-level changes that Foursquare wants to initiate this summer. Another revenue stream is to charge businesses a one-time $10 fee to get their accounts verified through the service so that people know deals and places are legitimate businesses.
If you have ever used Foursquare, one of the problems I run into often is that some people can't find an establishment on the site and then create one themselves in order to check in, and when several people do this, you end up with multiple variations of the same company on the site and that ruins the continuity and takes the power out of the business' hands when they want to connect the location to deals and updated information.
I think that, if executed well, the verification system would be a great improvement to the Foursquare ecosystem but it all depends on how many people will pay the fee and how these people are, in fact, verified.
The location-based services are growing, though they are not yet mainstream, since many people still find it "creepy" or an over-share to check-in everywhere you go.
As more of the mobile payment services like PayPal, Square, LevelUp, PayDragon, Bump, and others make it a common part of the transaction to pull-out there phones and use them in the shopping process, more people will also find the value in checking-in -- especially if it is tied to loyalty points, deals and other perks.
It will be interesting to see just how much the check-ins jump this summer when it is tied to coupons and I wouldn't mind adding some thrifty shopper or coupon queen badges to my pantheon wall.
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