Foursquare, the social media sensation, along with competitors like Gowalla, Booyah and many others, has sure generated a lot of hype recently in terms of the relevance and (future) importance of “check-in” applications to customer relationships. The viral pop culture acceptance of these mobile applications has driven many forward thinkers to envision the day when these location-aware apps will become the delivery vehicle for loyalty-programs, targeted offers and of course advertising. I think that they are half-right. The mobile devices will be very important vehicles for OOH marketing. But location-aware applications that by definition require users to actively launch them and check-in before delivering their marketing payload are probably not going to be the winners in the long run. It will be location-based applications, delivered on those same mobile devices, that will emerge as the winners. Here’s what they are and why they will win:
The U.S. PTO recently published a patent application from Apple for a location-based application service. That application is covered in great detail by Patently Apple. At a high level, the concept is simple. Using the geolocation capabilities in the iPhone, a user that has opted in to the location-based application service would have temporary applications available on his/her iPhone based on their current location. By way of example, the patent application contemplates temporary apps delivered in a restaurant environment that might allow the user to view/join the waiting list for a table or perhaps order some take-out. The application is downloaded from the cloud, and disappears from the iPhone when the user leaves the restaurant. It is not hard to see the value of this approach. While each of your ten favorite restaurants (or grocery stores, movie theaters, or retail shops) may eventually develop mobile applications, not too many people will download them all and patiently navigate to them at the appropriate time. Instead, the latest and greatest version is made available only when you would want to use it: when you are there. No check-in required, and location-based, relevant tools are at your disposal immediately. If you have opted into a loyalty program, a location-based application can identify you from your phone number, recognize you, incent you or otherwise reward you for being there. It can also allow you to do things, such as place orders, find items, or perhaps scan a barcode and learn more about a product. That is powerful stuff. These capabilities could be delivered on any smartphone whether Apple is granted the patent or not. The concept is what is important here. As a retailer or restauranteur, I would rather invest in my specific location-based application than be beholden to Foursquare and several location-aware providers and their subsets of my customer base.
By the way, digital signage is inherently location-based. Media player locations are known. Network operators can target media based on what is known about the location. Pairing digital signage with mobile location-based applications is a very powerful idea. The possibilities are enormous. Like many other fads, checking in is going to come and go. Walking in will never go away. That’s something to be aware of.
Very good post, as always. The future of location-based services will be a hybrid model of checking-in and passive location tracking. In its current form, passive location tracking requires too much battery power to be truly effective. There will be models, a la Foursquare, whose users will have the option of utilizing check-ins or continuous location tracking. With the expansion of Google Latitude, the search giant’s location features will find its way into a greater number of apps.
Batteries within our smartphones need to be enhanced and location tracking within indoor environments needs to be made more accurate. The standardization of a database of “Places” will further support greater utility from location-based applications. Many believe that once Facebook launches its locations features, the entire LBS ecosystem will be expanded: greater number of users, more location information, enhanced technology…