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SMART MARKETING
Attracting Customers Around the Corner

The number of consumers using location-based services – sharing where they are, what they’re doing, and what they like in real time – is growing rapidly as people become more involved with social networking and as smartphones with GPS capability become mainstream. Foursquare, Yelp, and SCVNGR are examples of services with strong marketing components that help merchants engage consumers while they are in their establishments and/or nearby – searching for things to do, places to go, and promotions. Each has a website where merchants post pertinent information (address, phone, hours, etc.) and create offers (points, badges, rewards). Foursquare and Yelp are free to both merchants and consumers; SCVNGR is a fee-based service for merchants that helps them set up challenges (like scavenger hunts) that users complete to win points and rewards while in one or more locations. All three services allow users to link to their Facebook and Twitter accounts; Foursquare and SCVNGR work with partners, including American Express (gosocial.americanexpress.com).

By far the biggest location-based service is Foursquare. The company reports it has 10 million users worldwide (an increase of 5,000% since last year), almost half of whom are in the U.S.; 70% are 18-35 years old; half are female, half male. Yelp, primarily a site where users write reviews, added a check-in feature earlier this year and they report check-in usage is growing at 70% month over month.

“I can guarantee you that people who go to your restaurant(s) have checked-in. The reality is that it’s happening and you need to get in front of it and manage it.” – Asif Khan, founder, Location Based Marketing Association

Claiming your business or venue page is a must. Consensus is that, at the very least, every business needs to claim or create their Yelp business page (biz.yelp.com) and Foursquare venue (foursquare.com/business/merchants/claiming), and verify that all information is correct.

Educating staff is critical. Most services have intuitive, easy-to-use tools on their websites to help merchants get started and train staff. Kris Guthrie, director of marketing for Landry’s Restaurants says, “We use screen shots in our training, showing step by step what the customer goes through when checking in and claiming a deal or reward. When our managers see customers checking in, they use it as an opportunity to engage them in conversation.”

Check-in offers should be easy to understand and to use. For example, Joe Sorge, owner, AJ Bombers, Milwaukee, WI, creates offers on Foursquare to incent individuals and groups (five or more) to check-in, offering a free food or drink item. He encourages Foursquare members to leave “tips” at the bottom of his Foursquare page – comments on what they liked and/or a photo they took in the restaurant – by giving a free cookie for each tip and/or photo posted. Joe says that sales of menu items promoted on Foursquare have risen roughly 30% since the restaurant began using the service two years ago. To stimulate happy hour business, Landry’s Cadillac Bar, Houston, TX, offered a free queso to those checking in on Foursquare. Kris says over a period of 75 days the free queso was awarded to 554 check-ins, who contributed more than $30K in sales (tracked on the restaurant’s POS). “The great thing is that people aren’t coming in just for the free food – our average check is up a huge amount.” Buffalo Wild Wings used SCNVGR to create a campaign during March Madness last year that gave customers ways to interact with one another and offered deals on wings. Participants got points for eating certain items, showing up wearing their team’s jersey, etc. In the first week, there were over 10,000 players, over 33,000 check-ins, and participants won 5,000 awards, some provided by SCVNGR partners like Coca Cola.

Analyze usage. Foursquare, Yelp, and SCVNGR collect and share data that provides valuable information about customers and the success of offers. Plus, there are websites – yourbuzz.com, a free service from American Express, and socialmention.com – that monitor what’s being said about your business via social media, including Foursquare. Services such as Geotoko provide location-based marketing data as well as analytics.

The future. “Location-based marketing is going to be more about discovery and less about deals,” predicts Asif. “People will use these services to find out what’s going on near them when they’re out and about – is there a Thai restaurant nearby, tips on what to order, etc. Deals won’t be the ultimate driver.” Aaron Strout and Mike Schneider, authors of Location Based Marketing for Dummies, believe the next step will be “passive check-ins” – to keep it simple, customers using these services will automatically be checked in when they arrive at a location. And, while Facebook has canceled Facebook Places, there is speculation that it is moving towards more location-driven features. It’s rumored that check-ins won’t be the emphasis but that they will still be part of status updates on mobile devices and that Facebook users will be able to select from a list of nearby places, and, if their location is offering a check-in deal, it will pop up.

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