The use of location-based services like Foursquare, SCVNGR and Gowalla has increased dramatically with the adoption of smartphones and mobile connectivity. By downloading an app that identifies where users are geographically, users can earn rewards and social recognition the more they check-in at registered locations. For local business owners, this can mean free advertising from customers eager to share their whereabouts with other users in return for discounts and rewards.
Here are five examples of businesses that have shown how beneficial this can be with their innovative use of location-based services.
1. AJ Bombers
The social-media-savvy burger joint AJ Bombers with locations in both Milwaukee and Madison, Wis., uses a range of services to promote itself including Twitter, You Tube and Facebook to interact with fans, run promotions and publicize news stories. One of its most popular deals is giving new Foursquare Mayors a free burger and fries, which has encouraged repeat visits and check-ins. The company also organizes events, one of which earned them the Midwest’s first Swarm Badge (when 50 or more Foursquare users check in at the same time at the same place). The event saw Bombers' revenue double from the same day the previous week.
2. Strange Brew Coffee House
Shane Reed of the Strange Brew Coffee House in Starkville, Miss. saw sales of his signature coffee drinks increase 34 percent in a year, thanks to his adoption of Gowalla and other social media sites. Strange Brew’s biggest challenge is that it's not located in an urban center, so it doesn't get many passers by. But using location-based services has helped drive customers to his coffee shop, especially after local sporting events. Customers receive a 10 percent discount when they check in with Gowalla, and their check-ins help to boost his business by upping his rank on local searches.
3. Fajitas & 'Ritas
Brad Fredericks, owner of Fajitas & 'Ritas in Boston, created a loyalty program for repeat customers using SCVNGR and its partner, LevelUp, and paired them with social advertising company LocalResponse (which picks up on local check-ins and contacts customers through Twitter to offer them coupons for future visits). He saw more opportunities for growing his business using these platforms as opposed to using a service like Groupon because of the potential for repeat business and word-of-mouth on social media, rather than one-off deals that didn’t encourage loyalty.
SCVNGR lets customers earn points that they can redeem for menu items by checking in and taking photos. Customers can also use LevelUp to pay using their mobile phones by signing up to their loyalty scheme. Two months after launching with LevelUp, Fajitas saw 15 to 20 customers a week using it to pay. Customers are also rewarded for loyalty through LoyalResponse. This combination of services has good potential for growing a loyal, local following.
4. Southern Hospitality BBQ
The Southern Hospitality BBQ, which despite its name has two locations in New York City, has been using Foursquare since 2009, and has since received over 7,000 check-ins and given away over 5,500 pints of free beer. The restaurant takes its use of social media seriously: Foursquare Mayors receive 50 percent off their bills and the team members take note of customers’ tips and provide feedback, as well as let them know about specials and discounts. The result? The Southern Hospitality BBQ attributes 4,000 new customers to its use of Foursquare and other social media.
Is your business benefiting from location-based services? If not, get started with these tips.
Don't give away the farm. Only offer promotions, freebies and discounts you can afford.
Get the demographics. Try and learn something about your customers from looking at who’s active on Facebook and Twitter. This can help find out your customers' age, gender and so on, as well as see which products they are talking about.
Use analytics. The surfing data provided on many of these services will help you analyze what works best in terms of customer usage.
How does your business use location-based services?
Image by OPEN Forum