One of the most important decisions Foursquare's leadership has made was revealed last week. It's one of those decisions that could determine if Foursquare becomes a footnote or a phenomenon. The only thing more incredible is that its future now will be determined by how consumers use old-fashioned grocery store loyalty cards.
Before diving deeper, it's important to appreciate where Foursquare stands today. It launched in March 2009 and quickly sought to own the concept of the check-in, popularizing it enough for Facebook to mimic the core functionality. Foursquare stands out as a great app for both the user experience and the ease of participation for local businesses. Foursquare has achieved several notable milestones recently:
· In October, it celebrated its 200 millionth check-in two and a half months after announcing its one millionth check-in.
· Foursquare reached 4 million users in October, up from 3 million in August.
· Foursquare is reportedly adding 20,000 users per day, which adds up to 600,000 per month. If it just stays at that pace, it will reach 10 million users around August 2011, and its pace of user sign-ups has been accelerating.
Still, Foursquare hardly has mass reach. If you're trying to reach New York 20- and 30-somethings to promote your new line of bacon-chocolate cupcakes filled with vodka-flavored ganache, you'll reach enough of the target with Foursquare. For most other marketers, scale isn't the selling point. There are several anecdotes and studies supporting Foursquare's skeptics:
· Some Foursquare experiments have outright bombed. Its highly publicized "I Voted" badge was earned by a mere 50,000 users, none of whom actually needed to vote to earn it. All you had to do was say you voted. Compare that to 12 million Facebook users who declared they voted, all without any virtual reward as a motivator.
The idea of checking in isn't for everyone and will only spread so far. There's more to these location apps than check-ins, though. Social recommendations are a major part of the appeal. And now Foursquare is trying to make the rewards of using such an app even more tangible with its new program with Vons, a California supermarket chain.
With the grocery program, detailed in Fast Company, VonsClub members can link their loyalty cards with their Foursquare accounts to earn special coupons. In the process, Foursquare simultaneously made the check-in both more and less important with this deal that seeks to expand the appeal of the app beyond the BCC (bacon-chocolate cupcake) set.
There are opt-in options to make the grocery program more social: participants can automatically check in on Foursquare when their VonsClub card is swiped, and they can "shout" to Foursquare friends when unlocking rewards. It's surprising to see those options, as I don't see shouting as a popular Foursquare feature, and normally the idea is to check in when you get somewhere rather than when you're leaving. There are some benefits to the approach though. Retailers and any participating brands get added exposure, while consumers don't have to actively manage their Foursquare account at all.
For users who are more active, marketers can gain far more creative ways to reach them. For instance, a beer brand could target a grocery store's customers who check in regularly at sporting events or who check in anywhere weekly after 10 p.m. Consumers who check in frequently and link this with loyalty cards will be eligible for more rewards, even if they never became mayor of their grocery store or anywhere else.
Taking a step back, there's a more important question Foursquare will need to answer: Why would people check into grocery stores? It turns out people do already. Searching foursquare.com for Vons in San Diego, I found two right away with more than 1,000 check-ins apiece. I'm able to find other stores such as a Kroger in Dallas and Food Emporium in New York hitting the thousand mark. And while this is a generalization, after reviewing a number of grocery stores in major cities with at least several hundred check-ins, most tend to have roughly a quarter to a third as many total people as total check-ins. Compare that to the number of people waiting ahead of you with 15 items in the 10-item-or-less express lane and it isn't much proportionally, but it's something.
How much of a thing will it be? That's the question worth a hundred million, a billion, or however many dollars Foursquare's founder has been rumored to have turned down lately. It's also worth quite a bit to retailers and marketers that want to figure out how Foursquare and all of its location-centric peers can bridge that legendary gap between online and offline experiences. If this VonsClub deal isn't what Foursquare users or grocery store consumers want, someone else will find a way to do it better.
Today though, it is what it is: something that matters, has momentum, and meets many parties' needs. As for the mayorship of location-based services, that title is still up for grabs.