Coupons and deals is where the real value of Foursquare lies. In the case of Zest, the restaurant has found a new way of implementing loyalty cards and they're leveraging a viral marketing element, thus creating loyalty cards 2.0.
The most common criticism I hear of Foursquare is, "why should I bother checking in?". A friend and colleague of mine, Jeff Bacon, sums up his own frustrations with the service on his blog, basically saying it takes too long and he may not want his location constantly broadcasted. What I propose, is that if more businesses were on board, and the incentives were more clear, you would have more check-ins and even greater consumer adoption. Also, you would probably see an increase in spending for those businesses that are hip to the trend and implement creative checkin deals for users to take advantage of.
Foursquare's strategy for business adoption seems to be to attain consumer adoption, focus on brand promotion, and wait for small business to find out how to sign up their place for a deal. Foursquare seems to really love partnerships with big brands like HBO, Bravo and Mazda, yet for some reason they aren't interested in the shift that's occurring when a small business like Zest offers a free sandwich in exchange for 7 checkins.
So how can Foursquare get more small businesses to sign up and create deals? Specifically, how can Foursquare educate those businesses in small cities like Ottawa, where the business owners may not be tech savvy? How will these businesses know if they don't watch Gossip Girl, where they'll hear that Chuck Bass just checked in to Blair Waldorf's underwear? Here are a few ways I think they can do this:
Print and traditional media advertising- Small business owners are most likely best affected by word-of-mouth and traditional print. They aren't managing a Google Reader account, and could care less what an RSS feed is. They do read the paper though. Ads in local papers like Metro would probably go a long way to reaching a demographic that doesn't care what a "blog" is.
Exposing API data through thoughtful blog posts - Journalists aren't exactly programmers but there is a wealth of data available to anyone who can hack the API. By mining the data themselves, and exposing it on a corporate blog, Foursquare can make the data available to everyone. I'm sure they could tell you a lot about your city, its local economy and what consumers are looking for. Foursquare should be sharing this data because it helps everyone in the long run.
Partner with coupon services to deliver checkin-based coupons - Groupon was offered a $6Bn acquisition from Google and they weren't interested. It's not obvious what the terms of the deal were, but keep in mind Groupon is rumored to make around $2Bn per year. At a 3X revenue buyout from Google, it's not the deal of the century. That being said, Groupon's business model is great and Foursquare needs in. I'd like to see Groupon offerings based on people checked-in. The deal would read: "if 50 people check-in to Mercury Lounge this Friday, shots are $1." There are probably liquor laws preventing this exact deal, but you get the idea. #epicswarm
Offer deal redemption awards to your users - Badges are getting lame. Telling your friends you got a badge was cool back when Foursquare was relatively unheard of, but early adopters aren't interested in telling their friends what virtual reward they've earned. Instead, give your users awards that are potentially worth real dollars. Virtual goods may seem worthless but they're quickly gaining in value. Avatars, profile customization, gifts, anti-gifts, credits and community respect are all worthwhile incentives for users. Offer these rewards to users who take advantage of deals and help drive the viral promotion of small business incentives.
Foursquare and Gowalla offer some great potential for broadcasting your location but I'd like to see more emphasis on check-ins and incentives. Every time I walk into a restaurant, I'm tempted to check-in but the value proposition isn't really there. With a good incentive system, I guarantee you I'll be checking in to every venue possible.
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