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How to Use Location-Based Social Networks for Your Business

More small businesses are looking to profit from promotions on location-based social networks such as Foursquare and Gowalla. Here's a guide to tapping in to the power of the check-in.

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Geolocation and location-based social networks are buzzwords of the moment, particularly in social-media circles. Whether you're a business owner, a marketer, or a consumer, you've noticed friends "checking in" on Foursquare or associating locations with their latest tweets. Small businesses and huge brands alike are trying to figure out this new and continually evolving space.

That's for good reason: People are using an array of location-aware apps and online features, and some have been proven to provide social-media savvy businesses – especially businesses with a storefront or venue – with a boost.

Dig Deeper: How to Make Money on Foursquare


Using Location-Based Social Networks in Business: Learning the Basics

The location-based services market is burgeoning, with check-in-based companies such as Foursquare, Gowalla, Yelp, and Brightkite leading the way (at last check, Foursquare is adding some 15,000 new users every day). More recently, the more established social players have entered the market. With the advent of Google Local and Twitter Places, Facebook has even made it clear posting a current location – not exactly check-ins, but close – is a feature it intends to offer soon.

"Looking at the big picture, location is where social media was in 2005 or 2006," says Rob Reed, an industry blogger and founder of MomentFeed.com, a company that helps companies use location-based services for marketing. "Location is growing so much faster than social media ever did. One year from now, we'll see location jump the equivalent of three years social media time."

Using geolocation for business isn't just about the check-ins, which can feel a bit empty and redundant (say a customer walks into your bar. If they check in, will they buy more drinks? Highly unlikely). The act of checking in, while it's the obvious first connection, is not where the value lies in these networks. It's the data that checking in and the behaviors revealed about a customer's patterns and habits that really add to the experience.

"If you're a business who appreciates what Facebook and Twitter have done for you, location is going to be 10 times more valuable," Reed says.

To appreciate part of the benefits your business can reap, think like a customer. By checking in, they're in a sense affirming to a wide net of friends and online connections that they "like" your business. It's a sort of endorsement. And, it can deepen the connection between the geolocation using customer and your business. Unlike mobile advertising, it's all about engagement in these networks with both existing and potential customers.

Marshall Kirkpatrick, who co-edits the technology blog ReadWriteWeb.com, recently wrote a post titled "Why We Check In." He says: "The Web itself has changed so many industries. Location and physical place is huge for businesses and marketers. It changes everything. By sharing your coordinates, you're merging location and the Web, essentially sharing where you shop, what you eat, what you read, and everywhere you go."

Dig Deeper: Get Your Business on the Geolocation Map 


Using Location-Based Social Networks for Business: Steps to Mastering Your Presence on Geographically Aware Social Media


As a business, small or large, it's time to utilize location-based social networks if you aren't already. Here are some simple steps to follow when starting out.

Listen and Learn. If you're just getting into location-based social networks, regardless the size of your company, it's fairly easy to get involved. But before you do that, Reed advises you, "check out what the big brands are doing and follow their lead, because they're doing all the research and investing in this space." According to a report released in 2008 by technology market research firm ABI Research, location-based social networks will generate a whopping $3.3 billion in revenue by 2013. Foursquare announced on June 30 that it had raised $20 million in venture capital, bringing the company's valuation to an estimated $95 million. "If you're an independent coffee shop or even if you have a few locations, you can learn a lot from more or less following Starbucks and their steps. They deserve a lot of credit for testing the waters with Foursquare, but I still don't think they're getting the most value out of location-based networks," Reed says.

Get Involved. Start exploring the space yourself. You'll want to start by making sure you have a smart phone and then download some of the many applications that exist. A good place to start out is with Yelp, augmented-reality layering browser Layar, Foursquare, Twitter, Facebook, and Brightkite. You certainly could explore additional apps, but these will be your simplest entry point into the game that is location-based social networking. Start using the tools as an individual, monitor what customers and users are saying about your business. Then, and only then, should you start using the services for your business, as you'll have a much clearer understanding of what you need. "Another benefit is the data that businesses can gather from these networks," wrote Todd McMurtrey of Amadeus Consulting, a firm based in Boulder, Colorado. "For example, Foursquare recently launched an analytics service that lets businesses monitor demographic data on who checks in. This lets businesses see a range of real-time data about their users, including male-to-female customer ratios, popular times of day and other information. This, and similar services, let merchants monitor and engage customers on an individual level."

Begin Creating Content. In other words, give your business a digital footprint. Start at Google Local and write a review, define your location on Foursquare and Brightkite, tweet about your spot, check out your Yep reviews, create a Facebook fan page if you haven't already. You want to make sure that the digital/mobile world matches up with your real-world business location, name, and more. Sync your website, promote your social media savvy on your business website, and just talk back.

Listen, Monitor and Engage. Once you've activated your location-based social networks, location-based engagements become key (just as customer service and experience do in real life). Listening is the most important part of marketing that a lot of businesses are not yet utilizing correctly. Monitor what customers are saying about your business, and respond to questions, complaints, and compliments where appropriate. The more proactive and responsive you are with customers, the more digitally savvy your business will appear.

Drive Location-Aware Engagement and Contests. "This is where the digital world meets the physical," Reed says. "You've interacted with your customers digitally, now you need to impress them with the physical location enough that they want to come back." So while traditional business standards still apply (service, quality, etc.), it's also about incentives and driving participation. Give people a reason to come by – offer a coupon that shows up when they check in nearby. Or use one of your networks and drive a promotional campaign to reward return visits (not unlike many traditional loyalty programs). And once folks are there, try to utilize your physical location with signage or targeted marketing over the apps or networks, which can drive participation. Foursquare and Yelp offer window stickers, but upping your engagement can be as simple as asking customers to follow you on Twitter. Taking all of these steps might not show immediate returns monetarily, but the customer engagement, loyalty, and brand recognition will help you in the long run. At the very least, the above efforts should help potential customers find your business when they activate their location-based social networks, and that's really the first step.

Dig Deeper: How to Incorporate Badges Into Your Website 

Last updated: Jul 8, 2010




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