October 30, 2012
Is Foursquare On Its Way To Becoming A Local Search Star?
Joseph Henson is an Internet Marketing Specialist at Search Influence, a national online marketing firm focused on small and medium-sized businesses, and white label online marketing products for publishers and media partners who serve them. Search Influence is the largest online marketing company on the Gulf Coast and New Orleans’ only Inc. 500 honoree in 2011.
In terms of monetization and positioning, Foursquare has made great strides in 2012. What started back in 2009 as a “50% friend-finder” app with social gaming and local business review elements, has evolved into a powerful social-local-mobile recommendation engine that has the potential to rival more traditional local search powerhouses like Yelp and Google. The company is also showing promise in creating a mobile advertising platform that is seamlessly integrated and appreciated by users.
Foursquare’s sudden burst of upward momentum can be traced back to last June when the company raised $50 million in a round of venture funding that went towards further building the app’s functionality. Soon after, the company began making robust improvements to their local search feature, “Explore” by including results based on the time of day, friend activity, followed lists, and the 2.5 billion check-ins made by their 25 million users.
In July, Foursquare began its push into monetization with the limited roll-out of promoted updates. These relevant ads are included in search results where a business can promote its services, events, products, and specials. Promoted updates show promise in being a powerful mobile advertising tool for local and national businesses alike. The options, when compared to the likes of Yelp, are elegantly integrated into the existing Explore search results and are surprisingly relevant, customizable, and targetable.
Most recently, the company took another leap towards local search preeminence by partnering with OpenTable. This partnership allows for deep in-app integration with the restaurant reservation service, allowing Foursquare users to access menus, browse reviews, and make reservations. While the partnership is great news for users, it is a bit of a late effort — Google and Yelp have been integrated with the OpenTable platform for quite some time now.
Foursquare has no signs of slowing down, and it will be interesting to see how events play out now that the company is directly positioning itself against the heavy hitters of local search. While it is true that competitors like Yelp and Google have the advantage of higher amounts of users and traffic, numbers that are sure to increase for Yelp due to recent partnerships with the likes of Bing and Apple, Foursquare still has a variety of qualities that make it a viable competitor. The company truly gets how social-local-mobile should work; its ability to utilize rich behavioral data in search results and integrate relevant advertising cleanly and manageably stands out amongst the competition. If Foursquare can maintain this momentum and form more strategic partnerships in a similar fashion to Yelp, the company could establish itself as a high-engagement marketing tool that both small local businesses and large national brands won’t be able to ignore.