Using Foursquare to Reward Customers

With 1 million users and counting, Foursquare is touted as the next hot social media tool.  But is there a business application?  Should marketers care, or is it just another passing fad?

Foursquare is a location-based social networking service for the web and mobile devices, as well as a game.

The mobile app, calculates your location, and provides you with a list of restaurants and stores in the area.  You find your restaurant in the list, select it, and touch “Check-In Here.”  If you are hoping to locate people, you can include a brief “shout-out” message – “mini college reunion with Rachel and Pam!” -  which quickly spreads to your friends on Foursquare, and also Facebook and Twitter.

This is just one example of why city dwellers are tapping into this new service.  In addition to this friend-finding aspect, Foursquare is also a game.  Users compete citywide to earn the most points each week.  Each check-in earns that user one point.  Extra points are earned through “badges,” awarded to the user after certain events (25 different places checked-in, out four nights in a row, etc.)

As the number of users has grown, the rewards have become more tangible.  A user becomes the “mayor” of a location if he or she has checked-in there more than any other user.  Businesses in turn are rewarding their mayors with real-world benefits.  Local bars and restaurants are offering free or discounted food and drink, and chains like Starbucks and Whole Foods have launched coupon programs for Foursquare mayors.

And Foursquare promotions are not limited to food and drinks.  Higher-end fashion chains like Diesel and Marc Jacobs have also launched Foursquare campaigns, as have media outlets like NBC, the New York Times and The History Channel.

Given that this is social media, and these campaigns are both new and ongoing, exact ROI numbers are difficult to find.  Starbucks has garnered the most press for its use of Foursquare, and its campaigns are likely to be tracked extensively in the blogosphere as the key test case for the viability of Foursquare marketing.

While the ROI of Foursquare marketing is uncertain, what is certain is that location-based social networking is becoming increasingly in-demand and important for marketers.  Twitter added a geo-location feature in November 2009, and Facebook’s location options are set to debut this month.  Foursquare also has a growing number of competitors in the location-based social networking sphere, including Gowalla and Yelp.

Mike Proulx of Hill Holiday recently shared some good examples of businesses using Foursquare on the company’s blog.

With 15,000 new users joining Foursquare every day, this new social media tool is fast becoming a new and powerful way to engage with customers.

[Catherine Weber contributed to this post]

3 thoughts on “Using Foursquare to Reward Customers”

  1. Thanks for writing about foursquare, as of late I’ve become obsessed with it and can’t get enough of seeing how businesses are using it! Have you found any other examples of how businesses are using foursquare to increase sales and retention?

    thanks again!

  2. Thanks for your comment, Nick.

    As a board member of a volunteer group of young professionals, I have recently been interested in learning how non-profits are using Foursquare. I see great potential for museums to use the service to provide an interactive experience for its visitors (i.e. “check-in” at your favorite painting), and for other groups to recruit volunteers (via the tips or to-dos features). As for examples of this, the Brooklyn Museum is experimenting with a special offer for mayors (see here: http://foursquare.ccom/venue/18737) Non-profit is a segment of institutional users I will definitely be keeping an eye on!

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