Thursday, October 20, 2011

Can Foursquare Actually Work for Marketers?

It’s Hip, It’s Happening, It’s Hot – it’s an Application that has Been Named by World Economic forum as Being The Tech Pioneer of 2011.

Imagine running a restaurant; and noticing a bevy of girls entering your outlet. Now imagine that you’re able to send a message immediately to all those girls that provides them a unique promotional scheme specially packaged to their demographic profile. That’s more or less foursquare (with a small ‘f’) for you, an application that can ensure that if your prospective customers are signed up with the application, they become privy to all such unique discounts purely based on their target profile. Created by Dennis Crowley and Naveen Selvadurai in 2009, foursquare’s unique proposition has been that it combines geographic data (latitude, longitude) of the consumer with the demographic data to provide a marketer most unique insights into the consumer’s purchase behaviour. But foursquare goes beyond, and in fact motivates the consumer through various schemes, badges, reward points et al to ‘indulge’ in purchase behaviour. Has it been successful? Well, with seven million users already (March 2011 data) and with the World Economic Forum announcing foursquare the Technology Pioneer of 2011, all eyes are set on this radical application.

With mainstream social web gravitating more towards mobile Internet devices, the emerging space of mobile-based social networks is empowering customers to find the best venues and prices for their products while offering savvy companies unique ways to cater to this new medium. Since more consumers are using the mobile social web, marketers are able create incentives and contests to drive customers to their business while brands look to connect with consumers within their stores. Naturally, brands are using different types of location-based services and applications such as Foursquare to not only tie their message to a real-world location and provide value for the user but also to get the word out about new products or to reward loyal consumers.

In our ever increasing hyper sharing of status updates society, foursquare has been widely acknowledged to be the breakout hit of 2010. Foursquare, on the back of its hot mobile social media platform, acts as a friend-finder, a social city-guide and a game that rewards you for doing interesting things besides allowing marketers to, as mentioned before, hyper-target their message to consumers at the precise moment they’re in proximity of business establishments. Truly, given the reach and the ability to target a user based on location allows marketers to deliver a message in a way that they haven’t in the past. Any business that wants to connect with a local audience can benefit from location-based services. Many research studies indicate that for impulse purchases, like food and clothing, there is a particularly strong opportunity to point a consumer to a nearby deal and see them take action. For longer purchase consideration cycle products, tying messaging to a location can serve as a strong reminder from the brand in the buying process.

More and more companies are hopping on the foursquare location-based services bandwagon as this tool apparently helps drive customer traffic and sales to businesses better than competing platforms – foursquare got the “Best Location Based Service Award” in the TechCrunch Crunchies 2010 event. About a year ago, in the USA, McDonald’s launched a promotional campaign built around a consumer-generated foursquare day. It raffled 100 $5 and $10 gift cards to foursquare users who checked in at a McDonald’s store location. The event generated a 33% increase in at the chain’s locations. Similarly, Saks Fifth Avenue and InStyle now regularly offer several foursquare promotions throughout the year where customers can “check-in” to certain departments to get a prize such as lip gloss or gloves. Foursquare users “check-in” to places using their smartphones. Check-ins earn users points and the more you check-in the more you’re rewarded with social currency in the form of various badges — and you can share your “virtual acquisitions” automatically on Twitter and Facebook. The person who visits a location the most becomes “Mayor” of that place, until someone else comes along and wins the title. And foursquare promotions are not limited to food and drinks alone. 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.

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Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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