Foursquare eyes to launch in the next two months a paid-media platform and is pitching brands to become launch partners. Merchants will be allowed to promote a deal to check in at a given area through its existing merchant platform, which allows businesses to claim their Foursquare listings.
"When users search for local specials, they can see offers via paid ads on Foursquare. Those ads will be targeted using the same algorithms that power "explore," which recommends establishments based on a users' past check-ins, as well as those of friends and the wider Foursquare user base," reports Advertising age.
Foursquare is developing these offerings in consultation with marketers that it has worked before with brands including Pepsi, Dunkin' Donuts, Whole Foods and RadioShack.
Walgreens's (who worked with Foursquare in the past) Social-Media Director Adam Kmiec said he had been briefed on Foursquare's nascent paid-media plans but hasn't committed yet. "As Foursquare rolls out its new paid-media platform, we'll certainly be giving serious thought to how it would fit into our commitment to bring social to a local level," Kmiec said.
"We are interested in any way we can make our customers more aware of our specials," Kmiec said. "We also think it shows that Foursquare is maturing as an organization."
Steven Rosenblatt, former Apple iAd sales director, has been assisting Foursquare with ad products development since January. "Steven has been working closely with our internal monetization team as an advisor," Erin Gleason, Foursquare rep told, adding that the relationship began several months ago.
Rob Reed, CEO of local-social marketing provider MomentFeed, said Rosenblatt could be a big asset to Foursquare because specials on the app platform "are also full-screen smart phone experiences, not unlike iAds, and there is plenty of room to innovate with scannable barcodes, dynamic targeting, and point-of-sale integration… Foursquare can drive sales, and that's ultimately what marketers want."
But Foursquare doesn't have the mobile check-in market to itself. Facebook has been urging national retailers to have a strategy for their "places" pages for local stores, and last summer it introduced "parent-child linking" to let brands administer those pages centrally, which enabled them to set up check-in deals and promotions.
According to Reed, the number of likes for the places page seems to have grown exponentially over the past month, which he attributes to a change in Facebook's search algorithms.
While Facebook has the scale, Foursquare has engaged users. Reed noted that Target, for instance, gets much more check-in activity from Foursquare than from Facebook. He attributes that to Facebook check-ins' tendency to be more event-driven and used by people who want to memorialize a night out on their timeline.
Reed thinks the two companies could soon be more directly in competition because of a recent development at Facebook who just-launched "offers." "It's definitely going to compete head-to-head with Foursquare because the offer itself is free [for brands]," Reed said.
Foursquare, who has recently topped 20 million users, declined to comment on its ad plans, stating, "Over 750,000 businesses use Foursquare to engage with their customers, and we're continually improving our offerings to make the platform even more powerful for them. Our goal is to build scalable self-service tools that enable businesses to draw in new customers and retain and reward their most loyal ones, while also enhancing the Foursquare experience for our 20,000,000-strong community."