The Future of LBS

Real Life Incentives

To be honest, I feel like this is a pattern that should have been adapted long ago. We've recently been seeing the big LBS companies like Foursquare and Gowalla moving towards "real-life incentives." Cool right? Well, it's just so cool that it could be the only thing keeping this growing location based check-in business alive.

I've been following this industry quite closely. I love the idea of being able to "virtually" check-in to locations that I frequently visit, enlisting in a global game with people I don't know to ultimately gain the crowned achievement of mayorship. Yeah, this game concept is cool, which is why Foursquare, Gowalla, and now even the likes of Yelp are trying to jump on the ship. But is this game concept really enough to keep people attracted? Well, up until now it has, but I don't think it's expansion could be very well sustained without some possible incentives. Virtual badges are cool and all and give people a sense of accomplishment, but there definitely needs to be an outlet or real-life incentive to affirm that a check-in to Safeway down the street is actually going to do things for you.

Well, now it is. Foursquare has partnered up with Bravo, big time. Bravo even has a Foursquare commercial. Gowalla, in response, has partnered with the Travel Channel and intends on making this a good competition. This is exactly what I had in mind for the next progression/step of these businesses. People need tangible results for their efforts. While it only takes 3 clicks to sign into your favorite restaurant, why would continue to do it if you were only going to be called the "virtual" mayor. Well, Foursquare was on this quite a while ago, partnering with small local businesses that offered free food to people who held the "Gym Rat" badge, but mostly offering incentive to "Mayors." This is a great marketing tool for both Foursquare and restaurants, not only does Foursquare get face time, but these locations get to advertise their restaurant to the masses, and yes Foursquare brings the masses.

Why This Will Stick

People are naturally competitive, they will fight for everything, resources, status, and yes, even mayorship. I think people will continue to fight for this acclaimed position, but now they have financial benefits to doing so. By checking into their favorite restaurants, they have the opportunity of getting their favorite dishes for free. Yes, now you understand why this is such an important move for these companies. 

Now, emphasizing the move of Foursquare and Gowalla in these recent days, you can understand how partnering with the big boys in advertising and public image would be good in getting out the name. Now, whoever can get the major contracts or partnerships out there will be the #1 LBS company.

So hear me, if you are a location based service offering check-in capabilities and you want to provide a new spin and keep up with the Jones', you need to adopt real life incentives. Without these tangible (and often financial) incentives, it is unlikely that you are going to get user retention. While novelty may gain interest, financial incentives offer user retention.

Posted via email from boochikan's posterous