Location-based services: Are they there yet?

We look at Facebook, Foursquare, Google Latitude and Yelp to see how their mobile location-based services have prospered -- or not.

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Foursquare

Foursquare was one of the first to exploit the notion of location-based check-ins in 2009 -- an idea that other services have tried to reproduce, to varied success. With Foursquare, a person's location is important only as a way to find friends and compete in geographic-based gaming.

The basic idea of Foursquare is likely the most familiar of all the LBS tools: Users check in with their mobile devices at venues and are awarded points for checking in. Check in enough times at a venue (which can be a business, concert or event) and you can be awarded a badge from Foursquare, or become "Mayor" of that venue until someone comes along and bumps you out of that spot.

Foursquare
Foursquare

Most members use the service in one of two ways: They can either compete for badges and points without necessarily revealing their locations, or broadcast their locations in the hopes that nearby friends will see the updated status online and join them at that venue. Even this is not binary: Many users game and socialize in blended efforts that suit them.

Christy highlights this gamification as a major reason why Foursquare is often the centerpiece of a social media strategy for his retail and restaurant clients. "As a society, we're just competitive," Christy says.

From a user perspective, Foursquare clearly has an impressive base: At the end of 2011, there were a reported 15 million Foursquare users. This strength is enhanced by tight integration with Facebook (which also neatly solves Facebook's immediate lack of a native LBS).

For businesses, the social/geo/gaming aspect of Foursquare is very easy to plug into. Mayors can be awarded small gifts for their titles: Free coffee or a certain percentage off for that day's purchases are very common. Businesses can also create longer-term promotions that involve more user participation, or branded "tip" lists for Foursquare users that reward checking in at certain venues or purchasing items from businesses.

According to Silva, Foursquare has all but wrapped up the LBS space. "They are doing the best job so far in monetizing location services," Silva explains, going on to describe a recent Foursquare/American Express partnership program that enables an instant discount for patrons who check in at participating vendors. For vendors, this is a painless way to upsell, Silva adds, while customers experience a seamless discount, since the transaction takes place on their American Express card.

Recently, Foursquare has enabled user tip lists that let participants recommend (or not) any given venue and give their own advice on what's good or bad about the venue. This has been seen by some analysts as a foray into Yelp's social recommendations.

"If you're scoring at home, Foursquare claims to have "tens of millions" of tips," wrote marketing and SEO expert Matt McGee on his blog in January. "Yelp has somewhere around 22-23 million reviews, as I understand, and Google has somewhere in the neighborhood of 13-15 million reviews and ratings combined... I'd say that the game is on in local search."

Foursquare also has a list capability that was implemented last August. A list lets a Foursquare user build a group of businesses that they prefer to frequent, such as "my favorite restaurants" or "10 great independent bookstores." By sharing these lists with friends, Foursquare users can share their interests and favorites in larger chunks of information.

But end-users aren't the only ones that can benefit from lists. Businesses can also create branded compilations that can bring customers directly into their door, as well as deliver their brand in other ways.

Foursquare is clearly the one to beat in this space.

Google Latitude

Compared to Facebook and the other LBSes, Latitude's story seems more like a confusing labyrinth.

Google Latitude
Google Latitude

It was originally built by the same folks who created the Dodgeball geo-location service, which Google bought in 2005. (Eventually, the two Dodgeball founders left Google under less-than-ideal circumstances.) One of the Dodgeball creators, Dennis Crowley, would go on to found Foursquare after Google halted Dodgeball in 2009 and replaced it with Latitude.

The Google Latitude service is an add-on to Google Maps that allows mobile phone users to let specified Google account members know where they are. The location can appear on, say, Google Plus as a status update, or can be viewed on an iGoogle home page in case a loved one wants to see where you are at any given moment. The service also features automated check-ins and departures, and deals. Android users of Google Latitude recently got the ability to see a check-ins leaderboard, which let them see other users who are checking in at that particular business.

Google far and away has the best and broadest reach of any of its LBS competitors to get advertising connected with geolocation.

(Story continues on next page.)

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