Foursquare checks in on a new business plan
A man looks at the internet site Foursquare June 21, 2011 in Washington, D.C.
Kai Ryssdal: The key thing in mobile right now -- what your cell phone can do for your and for businesses -- is all about location. Telling people and those businesses and advertisers where you are, what you're doing there, and who else is there. A company called Foursquare has that part down. The mobile check-in service has about 20 million users who let their social network know where they are multiple times a day. What Foursquare doesn't have quite yet is a way to make money off all that checking in.
Forget location, location, location. Marketplace's Stacey Vanek Smith reports Foursquare's new business mantra is recommendation, recommendation, recommendation.
Stacey Vanek Smith: Danny Sullivan is the editor in chief of tech news site SearchEngineLand. He's also an avid Foursquare user. And I finally got to ask something I've been dying to know about Foursquare users.
Vanek Smith: So why do you check in?
Danny Sullivan: Initially I checked in just because all the cool kids were checking in, right?
But now Sullivan uses it like a social network to find friends wherever he might be. He says that's a big part of what the new Foursquare is all about.
Sullivan: It seems designed to be focused much more about what your friends are sharing and enjoying and exploring.
The new Foursquare offers personalized recommendations for cafes, bars and shops -- based on where you are and places your friends have liked. Kind of a Facebook meets Yelp.
Carl Howe is vice president of research at the Yankee Group.
Carl Howe: This idea of where next, in the marketing world, we call that a lead. We're drawing people to a new site. And that's something a business will pay money for.
Just ask Yelp. It's made a big business out of sponsored recommendations from retailers. Howe says if Foursquare wants to out-Yelp Yelp, it needs to build relationships with thousands of businesses.
Howe: That's going to take a lot of feet on the street and a lot of great salesmanship.
SearchEngineLand's Danny Sullivan thinks Foursquare's makeover isn't about adopting the tactics of its rivals to compete on its own. He thinks Foursquare's trying to attract a buyer -- like Facebook. Two years ago, Foursquare was riding high and spurned interest from Facebook and Yahoo.
In New York, I'm Stacey Vanek Smith for Marketplace.