Location and check-in powered social network Foursquare is now open for business for 1.5 million merchants around the globe, which will now be able to push location-specific advertisements to users.
After almost reaching bankruptcy, Foursquare has recently secured investment and may have now found a sustainable business model in offering advertising space to small merchants around the world. This effort is in line with the company’s recent release of updates that automatically push recommendations to Android and iOS users.
Foursquare has announced that it is opening its ad platform to small businesses around the world, starting with 1.5 million merchants in its database. This expands the platform outside of the initial small group of select businesses that have been serving ads. According to the announcement, Foursquare Ads goes beyond a simple “like” or “click” by ensuring that a potential customer is actually walking into one’s store. This is a real-world validation of the effectiveness of advertising, says the Foursquare team.
“We built this to be simple and flexible, learning from our four years of data and relationships with over 1.5 million claimed businesses,” the team says, adding that businesses who have claimed their establishments on the social network should find it easy to set up their ads, define their budgets and monitor their results.
According to Foursquare’s chief revenue officer Steven Rosenblatt, this platform closes the loop for merchants, as it will determine the real-world effects of online advertising. While, previously, only online purchases or conversions can be traced, Foursquare Ads will now enable brands to attract users who are near physical shop locations, and know when a targeted user has actually been to the store.
Success is calculated on a per-action basis, such as how many clicks the ad garnered, and how many check-ins were actually recorded.
Rosenblatt shared with Fast Company some indicative figures that suggest small businesses may be a steady and sustainable source of income for the social network: “On average, we’re seeing [merchant ad pending range] anywhere from, depending on the category, $200 to $500 per month.” Additionally, the company is steadily growing its sales team and will increase engagement with merchants in order to get more businesses to advertise on the platform.
With this launch, Foursquare is on its way to becoming a dominant player as a location-based ad platform. Foursquare check in-based deals, coupled with push-based notifications for users nearby, might just be a great way of attracting leads and sales, especially for small establishments looking to compete for attention within a specific location.
Source: Foursquare / Image: B2C