Last Updated Aug 20, 2010 3:49 PM EDT
This has got to be about the last thing small-business owners need: a game where customers use their smartphones to "check in" at your business when they're nearby and post their thoughts about your offerings. And--get ready for it--whoever checks in the most is crowned "mayor" of your shop.
That's the concept of white-hot location-based social networking app Foursquare, created by New York-based Foursquare Labs. Though it sounds like a particularly bizarre detour on the high-tech highway, consider this: 140 million smartphones--each capable of generating remarkably accurate positions--will be roaming North America, and your business, as soon as 2014, according to international market research firm Frost & Sullivan. Location-based services are expected to morph into a $1.4 billion market by the same year. And Foursquare, whose membership soared from 1 million at the end of March to 1.8 million as of mid-August, has grabbed the pole position in this brisk market.
What's Foursquare's secret? Good, old-fashioned discount coupons, delivered in a newfangled way.
Foursquare offers instant discounts--just like the ones many businesses place in the PennySaver or in the Yellow Pages--to customers who are not only interested in your business, but who are physically near your business. And, at least to start, you can try the service at no charge.
"I've been dubious about Facebook and Twitter, but the ability to offer a legitimate discount for consumers who participate in this program offers value," says James Brehm, senior consultant for Frost & Sullivan. "This is a real differentiator."
Foursquare was one of several location-based bar games that sprang up as GPS chips crept into smartphones; Mountain View, Calif.-based Loopt and Austin, Texas-based Gowalla were other early leaders. Players would use their portable devices to tell friends their whereabouts by "checking in" from various locations throughout the night.
Beyond the meet-up opportunities location-based games afforded, those who checked in the most could win virtual prizes or badges. From those roots have grown applications that have as much game for businesses as for players: When users check in, they are encouraged to give an inside scoop about a business--not "good burgers," but "it's not on the menu, but if you ask, they'll put grilled green onions and GruyÃ¨re cheese on your burger for no extra charge." Friends who are nearby at the time, and those in the area later, see those tips and are encouraged to give their own recommendations about that business along with nearby places to eat, shop and see. And Foursquare turned these game mechanics into a viable marketing platform that even tiny, technophobe enterprises can harness.
"Foursquare's biggest asset at the moment is simplicity," says Bill Manos, co-founder of FavRav, a New York-based mobile application company. Foursquare is easy to use, and there's basically no barrier to entry. And it all supports a platform that lets any business compete with Web 2.0 giants like Facebook and Twitter, Manos says.
That is, if you know the tricks. Here's what you need to know to make Foursquare work for you:
Ignore the big boys -- at least for now. Zagat, the restaurant-guide publisher, offers a "foodie" badge for checking in at Zagat-rated restaurants. Bravo TV offers badges to viewers who visit locations that correspond with network shows like "The Real Housewives" and "Top Chef." All very cool, of course, but Foursquare is not a game to overplay, at least to start.
Rather, simply sign up for the basic, free platform by going to Foursquare.com and registering your business. If you spend more than 15 minutes here, you are doing something wrong. It will take a week or so for Foursquare to determine you are the owner of your firm. Once that happens, you're listed, which allows people to "check in" and comment on your operation. Don't worry--jumping in and offering your first discount coupon is super easy. It's right there in the sign-up process. Start with the deals you already offer all shoppers. And then sweeten the offer for your "mayor" so people will vie for the title. The coolest part? You spent nothing except maybe an hour of setup time. What's not to love?
Insider tip: Don't try to target specific users or coupons until you know what works. Location-based marketing is tricky: Get too fancy and you might find your antiques store filled with college kids who love the vibe of your shop. Yes, they check in and hang out. But they buy nothing. And that's not good.
Share and share alike. If the web is a two-way street, location-based marketing is a four-way intersection. You have to jump in and contribute if you expect people to contribute back to you.
Once you register your business, you personally need to start checking in around town on Foursquare and letting people know what you think and where you thought it. Be respectful. Make sure the information you're posting would be valuable to a customer who might be interested in your business. Not your kids. If you're a dry cleaner, for example, post a tip about a nearby tailor who has a great deal on buttons. Do that and customers will remember you. Think of other information you might share with a client, and share that on Foursquare as you go through your day. Again, simplicity and value are key.
Insider tip: Set up your Foursquare account to post simultaneously to your Facebook and Twitter feeds. That saves time in posting--and keeps your content on the business straight and narrow. Post lots of chatter and you will feel it.
Be a fly on the virtual wall. Foursquare users are not shy about telling the world what they think about your business. And Foursquare gets serious tech props for making it dead easy to track that brand perception. So be smart: Use the data. Read what they're saying. Track how many check-ins you are getting and at what time. Thank users for their feedback and, if they have a valid criticism, make the change. Remember, you have the ultimate small-business weapon in Foursquare: an easy-to- roll-out discount. As you get a feel for what the market wants, simply give it to them.
Insider tip: If folks regularly mention another nearby business, stop over and check in on--and check out--the competition. You might even find a smart way to collaborate with that firm to drive customers back to you. A little affiliate relationship love can go a long way on Foursquare.
Let others do the heavy techno lifting. As sexy as Foursquare appears, for sure steer clear of expensive coding to customize the tool. A whole beehive of techies is writing serious code for the platform. And that market is so fast-moving that what you probably need is getting built on its own. Head to the Foursquare apps page and pluck what you think might work for you. Some are even free.
Hot App Picks Here are our picks for early apps with business play:
CardStar lets customers use their phone rather than a wallet card to participate in loyalty programs. Devilishly effective, done right.
Bambuser is a slick mobile video client for Foursquare. How about a cool location-based commercial that you made and posted with your smartphone?
Waze is a social navigation app that connects drivers with insights into what's happening in traffic. Finally a way to talk to all those cars whizzing by.
FootFeed lets users simultaneously check in on social networks Foursquare, Brightkite and Gowalla, easily extending your reach to other platforms.
Yes, location-based social marketing is all the rage right now. Look around and you'll see everyone from RadioShack to Pizza Hut in the game. And even if your business is tiny, jumping into the location-based fray is quicker and easier than you might think. If you're tempted to write this off as the next fast-burning web candle, consider this: Your competitors are signing up even as you read this. Yes, Foursquare may be a game at heart, but it really is a game you can win.
(photo courtesy of foursquare)
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