There’s a tug-of-war going on between location-based
technology advocates and, well, the rest of the online population. Just 4% of
online Americans are actually using location-based services, according to new data
from Pew Internet. That paltry adoption hasn’t stopped startups like
Foursquare and Gowalla from trying to entice advertisers to offer deals on
their location-based platforms.
Now Facebook has entered the fray with its new “Deals” offering,
which gives users exclusive deals when they check in at stores. Is it
Foursquare's founder Dennis Crowley has an idea: turn influential social media users into affiliate marketers.
At a panel discussion the other day, he suggested that if you mention a
brand, or one of its products and services, and that mention generates
revenue for the brand, "you should get some kind of referrer’s fee." He
predicted that within a year, "there will be some way for [users] to get
kickbacks" through social media platforms.
As a big fan of location-based applications (I'm currently 'checking in' at various locations on five different apps...!) I have of course been watching the launch and subsequent spread of Facebook Places with great interest.
Now that the first batch of dust has had a chance to settle, I wanted to look in a bit more detail at some of the hurdles 'Places' may face in the coming months, if past experience is to be believed.
Brands are increasingly spending real money building up and maintaining their social media presences. From Facebook to Twitter to Foursquare, questions over ROI remain, but many brands have come to the conclusion that social media is an important part of the marketing mix.
But should brands bet too much on platforms like Twitter, which often have spotty performance records but are constantly trying to cozy up to brands? The answer might just be 'no.'
McDonald's may be a large brand, but it doesn't always want to invest large budgets in marketing. With a little help from Foursquare this Spring, the fast food chain increased foot traffic 33% in one day with an investment of less than $1,000.
Rick Wion, head of social media at McDonald's, is a big fan of such pilot programs. As he says, "the bigger your budget is, the harder it is to scale."
As individuals become more and more accustomed to sharing
personal information with social networking sites, it’s easy to see how this free
and easy exchange of information can be abused.
FourSquare, though entertaining and potentially useful for tips on the places around you and figuring out where your online friends are, does raise some security issues.
For those of you who
follow me on Twitter, you might have seen that I recently joined Foursquare, admittedly to try and find out what all the fuss was about.
In actual fact
I think it could provide great value to a lot of businesses, as well as certain
individuals trying to promote a cause or product.
Five years ago, one of the last things an entrepreneur with a hot consumer internet startup wanted to hear was "Google is launching a new service just like yours." It's 2010, and that has changed to "Facebook is launching a new service just like yours."
But that's precisely what Dennis Crowley, the founder of the increasingly popular location-based service Foursquare, recently heard.
Facebook's foray into location-based services launched last night. And while Places borrows heavily from existing services available on Yelp, Foursquare and Gowalla, one difference is the way that Facebook plans to grow its new product.
Facebook Places check-ins will be shared with users' entire network of friends. And if users wish, they can check other people into locations. Perhaps predictably, there are some privacy issues with this approach. But it ensures that people who may not otherwise interact with Places are sure to know it exists. And unless objections arise, Facebook's appraoach should be great for user adoption.
Much has been written about the benefits of location-based services for small businesses, but national chains are no stranger to mobile technologies. And Fast food chains are taking note as consumers adapt to new mobile practices.
With mobile apps, text to order service and location based marketing messages, fast food companies are learning that mobile is very good for business.