FourSquare and Social Business Design

Judging from the number of invites I'm getting for FourSquare these days, its slope of new users must be getting more vertical every day. (If you're not familiar with the service, read their overview.) After using FourSquare for a while, I've been thinking about its implications for business - and they're deeper than you might think, extending far beyond happy hours and local advertising opportunities.

At initial consideration, this may seem ridiculous. I'm not going to tell you that FourSquare is the next Twitter - it's not. It's different. But just like so many people were initially dismissive of Twitter, the same can be said for FourSquare. After all, the driving concept behind the application is "a leaderboard for Saturday night." The second time I heard about FourSquare, I was told that it was popular among New York moms and nannies for setting up impromptu playdates. Not exactly the FriendFeed crowd...I signed up immediately.

To understand FourSquare's emergent business value, you've got to think of it as a social business application, the backbone of which is measurement. Even more than other social apps, game mechanics drive the FourSquare experience. Based on the single activity of "checking in," all five elements exist:

1. Collecting badges and mayorships.
2. Earning points throughout the week.
3. Feedback though the leaderboard and a personal stats page.
4. Value exchanges from keeping tabs on your connections.
5. Customization of your profile and check-in messages. Anyone who uses the app knows all this.

When I consider FourSquare through the lens of Social Business Design, the value jumps off the page. The service:

• Relies on content generated by personal profiles and places, which come together in time-sensitive relationships. It also utilizes emerging technologies reaching critical mass. We call this an ecosystem.
• Motivates participants to broadcast their whereabouts with an implicit invitation to meet up. You become part of a relevant community based on geographic check-ins. This is hivemindedness.
• Allows users to send implicit messages about their status - on multiple levels - based on time and location. Others can respond in kind. These are dynamic signals.
• Permits control of messaging to personal preferences. Where and when a person checks in has meaning; some people check in "off the grid"/in private, whereas users can mute pings from others who are found to be irrelevant. This is a metafilter.

Think about these characteristics applied as a white-labeled enterprise application. Twitter : Yammer :: FourSquare : [a new "GrandCentral"?]

• Connects employees of distributed organizations when in geographic proximity.
• Lowers cost of coordination, handled today by many fragmented applications.
• Increases content production. Game mechanics spur participation and encourage collaboration.
• Allows colleagues to vet locations and set alerts for one another.

Applying these ideas in a marketing context address three hot B2C interests: mobile, social, and local. However, I think brands will find that scalability ends quickly. There are much bigger opportunities in the B2B context.

Are you seeing it? Or do you still think FourSquare just a waste of time?

Comments

[Beth]

Thanks for the analysis of potential business use. I've been looking at FourSquare in terms of nonprofit use. Certainly, any nonprofit that is place-based - for example performing arts centers and museums should be paying attention. Also, the possibility of using it for fundraising as this demonstrates
http://beth.typepad.com/beths_blog/2009/11/foursquare-fundraisers-anyone.html

[Ian Cleary]

Hi Peter,

This is the first time I heard about foursquare, it's a fantastic idea. They only problem is that it's another social media application to keep track of. They should integrate with twitter so you can send your updates from twitter.

Ian

p.s. if you try to login for commenting by selecting the twitter icon you are displayed the typepad login.

[Jeff Hurt]

Peter:

Great post and timely information for people. As an event professional and educator, I'm think the Foursquare model has some great applications for large conferences and events. Couldn't you see this type of iPhone app for BlogWorld or The Texas State Fair. For a large conference of several thousand, people could check in at specific breakouts, exhibit booths, networking events, conference parties, etc. People would know what conference sessions their friends were attending and how to hook up with them. If it added a Yelp type feature, attendees could rate specific sessions and speakers. People could get badges for checking into a specific number of booths, a specific number of workshops, etc.

For large events like the state fair, there could be badges for checking in and tasting the top 10 fried food products. Seeing the mose live performances, etc.

Obviously, you see the value of location-based social business applications.

[Keith Privette]

I completely agree!!!! It is funny you wrote a blog about this. I tweeted about a month ago how if you are a brick and motar business how useful this fun, connecting, informative, and engaging tool this could be. There are so many things you can do with this tool. Drop the phone book ads, ads in free or paid newspapers get your ROI by using @fousquare. Its ROI because the money you decrease in spending in those other type ads can easily be made up with a little investment in time on @foursqaure. Drive traffic and sales with a decrease spend on traditional ads that is ROI too!

Good post thanks Peter! Are you or the Dachis Group scheduled to come through Minneapolis anytime soon? If so hit me up would love to sit down and talk shop with you and your group!

[Peter Kim]

Hi Jonathan - FourSquare is funded by Union Square Ventures. One potential business model is to sell local advertising to local businesses. To make that work at scale, they'll have to go self-service like Google AdWords. Another is to sell aggregated user data, again to support advertising. These are both marketing solutions. I see a potentially larger opportunity for the company by offering a B2B solution. On the client side, this is an application that can help improve organizational efficiency, especially compared to some of the tools used to manage location awareness today. In many places, it's a whiteboard with X's and O's - or an advanced version that utilizes magnets.

[Jonathan Streete]

Should I be embarrassed that I hardly understood a single word of this conversation? Probably.

One of the things I didn't hear anything about was the business case for this platform. In other words, it must cost something to run and support Foursquare, no? Who's paying for it? And why?

Having lived in Silicon Valley during the dot com boom (and bust), I'm leery of apps/software/services/plugins/etc. that "don't need to show revenue because we're so cool and useful." I'm not a financial analyst, but the last time I checked, capitalism still requires that companies make a profit.

Anyway, the reason I follow you so intently, Peter, is that you are usually right on about the latest and greatest developments. I'm convinced that you know what you're talking about. Which means I guess I'll be forced to watch this one.

But I still don't get it.

[Lisa Bradner]

Pete, I think you hit on some really key reasons why Four Square has legs--also touches on what you and I talked about several years back: at what point do the social networks become "nobody goes there anymore, it's too crowded". In our attempts to filter through to relevancy, and to balance intimacy and connectedness, I think you'll see more hyper local, managed applications.

Your b2b comment kicked off the same thread it my head that Randal mentions above--funware. Employers have spent so much time worrying about "time wasters" in the office and have gone to great lengths to block employees from engaging in time wasting tools during office hours. However, your point about the engagement of gaming makes me think businesses need to differently--if we get our employees engaged in contests, games, and bragging rights can our collaboration tools become more effective and more heavily trafficked? We know from our clients that building the tool is one thing: getting peopel to use it, update it and populate it with content is quite another. Maybe if we take one more step toward blurring the lines between work and life and embrace the fun side of these tools in a business context we'll end up with higher productivity and more employee satisfaction after all.

[Randal Leeb-du Toit]

Peter, I totally agree that FourSquare is an interesting use case for sbd and game mechanics - did a post re them on metarand a week or so ago on this. Good to see you pushing the game mechanics angle as well. I'm a big believer in humanizing the enterprise with funware as a core element.

[IdoNotes]

Great thoughts. I have taken both sides to the idea of what FourSquare will offer. Some definite changes and additions will bring this ahead in location services (and quite frankly gaming based on location). Some better profile and venue controls coupled with automatic placing and mobile clients would leap this forward another step.

I first mentioned FourSquare and how it benefits local restaurants and venues http://bit.ly/1P0rDA but then begged the question on if badges are worth the effort. http://bit.ly/3DMxZ3

[Kim Feraday]

Really interesting thoughts here. I've been a luddite when it comes to FourSquare but I'll give it another look. I really like the concept of connecting people in geographic proximity. What might be a really interesting use case would be to extend this concept further -- say I'm at a conference and have just attended an interesting session. I step out to a local coffee shop for a break. It would be great if I could see others attending who I know so that we could share thoughts. Does FourSquare have a more proactive capability for targetting people I know in this way? I can imagine some similar ideas around customer sales meetings, etc.