In case you haven’t noticed, there is a digital warfare going on right now for location apps that allow people to “check-in” to a location virtually for incentives such as free pizza and beer when they become the mayor, or to virtually own property like you would in Monopoly with MyTown. And while MyTown is ruling the roost from a user acquisition stand point, the media is giving all the attention to the over hyped, and under delivering applications Gowalla and Foursquare.
As if Twitter wasn’t a hard enough sell for the majority (which I still argue it hasn’t successfully accomplished yet) but now these developers are actually hoping that users will be willing to take the time and effort to launch at least one of their apps to announce their presence at their favorite restaurant or pub. But where are all the users? The best performing location app currently only has 1.5 million active users… Twitter? 75 to 100 Million at best, but Facebook has a staggering 400 Million active users with their largest growth in mobile and has pushed them into the #1 visited site in the United States, even surpassing the Google Network. It also is not secret that Facebook is planning on pushing their own location based services that do use new and interesting ideas, and not just feature cloning obsessions like they have had with Twitter for the past two years.
QR Codes: Little barcodes more or less that hold bite sized information that scanners can easily recognize. It has been rumored that QR codes will likely play a large role in Facebooks location strategy and could solve one of the major loopholes that current location applications have which is that they are easily gamed by “checking in” to a ton of places you haven’t actually visited. By integrating QR codes business could not only run specialized promotions but could more easily track the progress and success of their online promotions to drive real, tangible revenues to their brick and mortar establishment. Facebook is now cashflow positive with their powerful self-serve advertising platform and will be getting hungry to show business the value that their profiling data can create when coupled with real world “gaming” that drives revenue.
So the real question that you would have to ask if you were an investor, are applications like Foursquare and Gowalla really with the millions that have already been poured into their technology? Granted they have pushed innovation within social media and opened up a can of worms that could be extremely popular when correctly combined with business side promotional efforts, but with the big blue Gorilla in the room (Facebook) where is the end game? How would you see yourself exiting this scenario in a profitable way? Obviously social media icons such as Gary Vaynerchuk and Kevin Rose are very bullish on the idea of location based applications, and both have been angel investors (Kevin somehow was able to invest in both Foursqaure AND Gowalla, not quite sure how that works).
What do you think as a consumer? Are you willing to use a secondary application just for checking into physical locations? Do you even care at all about doing this unless it offers some kind of virtual coupon, discount etc that is instantly redeemable? Or would you instead rather see all of these types of innovations rolled into one monolithic service from Facebook where most of your real world connections are hosted anyway, with the opportunity to push certain events into your public Twitter stream?
