Location based services have been generating quite a bit of attention for a number of years now and rightly so. Defined as a service that offers customers real-time alerts based on where they are located at any given time, LBS has huge potential. Foursquare, a leading LBS company that maps users to where they have checked in, has bet heavily on LBS taking off and that bet seems to be paying off.
Foursquare recently announced that they had more than tripled their user base to 15 million, up from 5 million users at a similar time last year. The location based services provider has gone a step further than the rudimentary definition of LBS to offer a geo-social experience that many businesses and users are finding even more useful than pure LBS services.
The meteoric rise of Foursquare has a lot to do with their internal innovation but can also be traced to a number of lucky bets that the company has made and that are now paying off. Here are some of the things Foursquare is doing right:
Through its partnership with Groupon, Foursquare was able to add daily deals to their location based services via the “Explore” tab. In a time when there is a lot of tumult in the daily deals scene, Foursquare timed their entry into the market perfectly, coming in when most other group buying sites are in the decline, as I opined in a previous post.
DIY Brand Pages
Following in the footsteps of Google who recently launched Google Plus Pages, Foursquare introduced a very simple DIY brand page option that only requires a Twitter account to access. This simple yet highly effective add-on has many small businesses’ interest piqued as they look for ways to leverage hyper-localized search.
Third Party Indexing
Online rating agency Klout recently started rating Foursquare profile information and this has had the effect that people using Foursquare now consider their Foursquare profile as part of ther social identity. Augmenting Foursquare’s merger between social and LBS, the geo-social service provider now has a wider, more practical appeal to its users.
Stroke Of Luck
Gowalla recently announced that it was closing shop and heading off to Palo Alto to join up with Facebook. This of course significantly reduces the competitive pressure that Foursquare have to contend with with the only other major competitors being Loopt and SCVNGR. The talent purchase deal that integrates Gowalla’s engineers into Facebook is seen as a move by Facebook to strengthen their LBS product Facebook Places.
All these signs seem to point to one thing, Foursquare’s rise is only just beginning. In a an interesting turn of events, a new report from Forrester indicates that only 6% of adults regularly use LBS apps with a significant portion of the general populace (70%) having no idea what location based services are. This represents a tremendous growth opportunity for Foursquare by demonstrating the size of the yet-to-be-tapped market for geo-social services. In addition to this, the use of the geo-social app from Foursquare by international users represents half of the company’s total users, a healthy position for any company that wants to win on both the local front and international arena.
What remains for Foursquare is to really tighten its options and innovate in a curve that adds to what they have already established. All we can say is that the future looks very bright for the geo-social services company and cannot wait to see what else they come up with.