12 Mar Foursquare a game? You may be missing the whole point
I’m on a plane flying from client meetings in Seattle to attend SxSWi in Austin. When I get there, I’m going to check in on Foursquare and Gowalla. Probably Loopt, too. Maybe I’ll break out my old Brightkite ID (probably not though) or look for restaurant reviews on Yelp. And I’ll use them to see where my friends are–from which panels they’re going to, to (much more importantly) which of the parties they’re attending.
In doing so, I’ll earn stamps in my passport (Gowalla) and badges (Foursquare). I’ll be offered specials at local restaurants, and I’ll have chances to win real prizes for checking in (since these services are running promos in town for the event), although I doubt I’ll be able to become mayor of anywhere during the visit (also Foursquare).
So clearly, location-based services like these are functional (helping me find and connect with friends during a conference) and fun (deposing a friend as mayor of a local establishment is a kick).
But that’s not the big picture
Location-based services/games/review sites that offer check-ins are part of a much bigger picture than most people realize. They’re also about very powerful, very personalized marketing. This is “Minority Report” type stuff, here, only now the cacophony of digital displays shouting at Tom Cruise has been replaced by just one: our phones.
And I’m actively giving them all the data they need to market to me.
It’s about massive data collection and processing
Check in enough, and suddenly the marketers know my habits. They know if I like Starbucks, or bar food, or books. They know if I’m an early bird or a night owl. When i travel from one city to the next, they’re going to be able to tell me where I can get that coffee, that bar food, that book. And it’s going to be based on what I already do–the types of places I frequent and when I frequent them. Throw in some coupons or specials, and I’m hooked.
For years, I’ve worked with a program called PRIZM that segments billions and billions of records to let marketers figure out that people that buy product X are 16% more likely to watch TV show Y, for example. I always thought it was the most powerful marketing data ever collected. But this trumps it. That data is in the aggregate and uses old info to project future actions on a population. Location-based data is completely personalized, and can be acted on at the very moment you most need it.
Should you be concerned?
When marketers get data, people typically get nervous. But in this case (assuming the location-based companies themselves are ethical), I don’t think so. If you have to go to a clinic to treat a particularly embarrassing medical condition, nobody makes you check-in on Foursquare. You don’t need to be the mayor of the local STD clinic, for example. (And if you become it, you can now resign. I’d suggest you do so.)
But the reason that Facebook and Twitter are both making serious moves to join these start-ups is because this is potentially the most powerful marketing ever created.
Marketing isn’t annoying. Marketing is only annoying when you don’t want the product. When you’re actively in the market for something (from a meal to an HDTV), marketing is great. It educates you. It saves you money. Ads become your friends. Location-based services may do much of that even better than ever.
So who will win the battle?
I’m not sure. What I am sure of is that by next year I won’t be checking in on 3 tools at once. There will be winners and losers and it’s going to be ugly for the next 18 months. I’m not sure if Foursquare is Twitter and Gowalla is Plurk [LINK], or vice versa. I’m not sure Facebook will trounce the upstarts, or if they’ll be clunky (as Google has been with Buzz, for example).
But the real winner is the one that does this:
- makes it fun enough to the end users to make us want to check in;
- makes the sharing of location functional, but not creepy;
- gets the back-end analytics and recommendation engines serve both businesses and the user. (Nobody’s done this yet. Foursquare’s new dashboard, pictured above, is a small step, but there are miles to go yet.)
I’ve talked to the folks at Foursquare a bit, and they’re pretty darn smart. So my bet is on Foursquare. I think nimble start-ups are best at winning new categories (that’s why we built Ignite the way we did). But there’s a lot of time left in this game, so I’m not willing to bet a lot just yet. Whether I ultimately win or lose that bet, it’s going to be exciting to watch.
Thoughts? Who are you betting on?
