A man looks at the internet site Foursquare June 21, 2011 in Washington, D.C.
A man looks at the internet site Foursquare June 21, 2011 in Washington, D.C. - 
Listen To The Story
Marketplace

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.

Sign up to stay connected to Marketplace and you could be in for a Halloween treat!

Subscribe to our daily newsletter by Oct. 31 and you're automatically entered to win one of 10 Marketplace treat bags. They're filled with some great swag, plus something unique to give you a peek behind the scenes — a program rundown signed by Kai Ryssdal.

Subscribe today for your chance to win – and good luck!

Follow Stacey Vanek Smith at @svaneksmith