Due partly to its former notoriety, I often say that Foursquare is one of the most misunderstood companies in tech. It’s gone from check-in darling to an under-recognized data powerhouse.
But in that transition, it’s more successful than ever. And its primary emphasis has remained the entire time: real-world consumer behavior. Meanwhile, the ad industry’s hunger for location data grows.
Foursquare has an edge here, its president Steven Rosenblatt told me recently. The data it collects from check-ins and pervasive spatial tracking (opted-in) is what he calls “ground truth data.” In other words, you are where you go.
This concept resonates in the wake of recently exposed bad practices in mobile local ad targeting. Many ad networks and ad tech players will claim precise location readings, which can really be off by miles.
This is mostly due to the challenge of getting users to opt-in to location sharing at the app level. So tactics have emerged to estimate location and sell it as a precise fix. Some offenders are worse than others.
This gives Foursquare an inherent advantage because its user experience is so tied to location that people naturally opt in (a la Pokemon Go). Beyond precision, it has more reliable user intent through check-ins.
“Some ad tech players say they collect over 1,000 location points per-user per-day,” says Rosenblatt. “No one visits that many places in a day… the way they get that data is by counting every place that someone walks by.”
Check-in data also has an advantage in creating user profiles from a mosaic of past behavior. I’ve always said location isn’t about ads based on where I’m standing… the smarter play is examining the last 50 places I’ve been.
But most of all, it’s shifted from a business model based on usage in its own apps, to one that instead packages valuable usage data into location intelligence to be sold to others in a scalable way.
Meanwhile it continues to uncover other uses for the data. One logical path has been to track trends in consumer behavior that can signal investment intel for equity research analysts.
As a preview to that trend spotting, the company has published smart content marketing around its data. It predicted iPhone sales in 2015, Trump’s campaign impact on his own properties and other viral nuggets.
So what’s next? Without specifics to announce, Rosenblatt and I speculated on augmented reality’s rise in local (speaking of Pokemon Go). In fact, Foursquare was the original quasi- scavenger hunt discovery engine.
Meanwhile, it’s seeing the best user engagement metrics in its history — even more so than its era as the check-in darling. It just clocked 10 billion check ins, and check-ins per user have grown by 3x.
Looking forward, location insights will only gain value as the famously laggard Madison Avenue catches up with the technology. Foursquare’s methodology and data chops will position it well through that adoption cycle.
“Location is the atomic unit of mobile,” says Rosenblatt.
Michael Boland is chief analyst and VP of content at BIA/Kelsey. Previously, he was a tech journalist for Forbes, Red Herring, Business 2.0, and other outlets.