Case Study: Using Foursquare to Increase Foot Traffic

How does the owner of a business with minimal signage and a hidden fourth-floor location encourage walk-in business? For Tom Elliot of Idea Greenhouse, a co-working office space for entrepreneurs and startups in Durham, New Hampshire (pop. 14,638), location-based services have been key. Elliot uses platforms like Foursquare, SCVNGR and Yelp to let people working in coffee shops know that a more attractive group workspace is available nearby.

What kind of role do location-based services play in your marketing?
We are present on all the LBS sites that offer visibility to the business. We’re a new business started in March, and I thought this was a very low-cost way to get visibility for a brand that’s really unknown. We’re up on the fourth floor of a brand new building, so we can’t have great signage and we don’t have walk in traffic. The next best thing for me is to have Idea Greenhouse listed on all the various social networking and LBS sites. Someone who might be checking in on Foursquare at the coffee shop down the street will have the option to check-in at Idea Greenhouse and go, “I’ve never heard of that. What is that?” I think of [Foursquare] as a discovery tool. I actually think that Google+/Latitude—their check-in function is probably going to be the most useful discovery tool for us. More people are using Google than Foursquare, and the Google+ phenomenon—they haven’t talked about it, but the whole check-in aspect and who’s posting nearby is going to become very powerful.

How do you measure the effectiveness of an LBS platform?
I find the lack of measurability of visibility on these networks frustrating. I’d love to know how many people click through on Foursquare, for instance. Obviously, I know who’s checked in and I have that data, but it’s pretty low volume for us. You have to work hard to get up here on the fourth floor, so that’s why I use these tools to gain visibility. The other thing I’ve done—and I don’t know how Foursquare is feeling about this—is I’ve gone around and left tips at a number of places nearby where people work, like the back of the coffee shop that doesn’t want you there. I leave tips at all these places, like “Hey, this is a great place to get coffee. Come check us out if you want a place to work.” At some point, Foursquare might start to view that as spam, but at the moment I think they’re happy to get people leaving tips.

What other LBS platforms or networks do you use besides Foursquare?
I use Yelp, which I think it is a dark horse in this game. They are really working hard to get people to use them as an LBS system more than just for online reviews. I was on SCVNGR for a little while. I think there’s a great opportunity there. It just takes more energy than I’ve had to set up the quests or missions around town. The [networks] I pay the most attention to are Foursquare, Yelp, and Google Places. The Facebook thing is interesting, but it’s clunky for us. The way Facebook approaches location—I’m sort of amazed it hasn’t gone through the roof given the user base.

Do you ever use paid advertisements?
I have run ads on the Google Places system, but not with great success. I found the cost-per-click astonishingly high, but I was also competing in a fairly crowded space. I was competing for the keyword on “office space,” so that puts me up against the big realtors. The LBS advertising opportunity on Google is evolving all the time. My hunch is that over time that will be a place where I will want to put some advertising dollars. At some point, I think Yelp could be the same. Yelp has really valuable content and you can check-in. Facebook has my social graph and you can check-in. Foursquare is just checking in. I did do a special for Foursquare Day where I gave anyone who checked in anywhere in New Hampshire or Maine on April 16th a free month of co-working here. I had three or four people redeem that, so that was a really valuable promotion.

Did any of the people who redeemed your Foursquare deal continue on with a paid membership?
That’s interesting—none of them have converted to a paid membership. I think that has more to do with where we are than what the Foursquare Day special was. There were folks who lived far away from here and who came in here to work. It didn’t make sense [location-wise]. I look at this stuff as the gateway to word of mouth, which is still the most effective marketing on earth. I had four or five really socially connected people who now re-tweet me, know about us, and feel supportive and excited about this place. So even if I’m not getting their $40 a month, it was worth it.

We are so early in what smartphones can do and what mobile, social, and local convergence will do for a business. The thing that will make LBS successful for us may not have even been invented yet. I have friends who say, “Facebook Places has failed. Nobody uses it.” That might be true in the last year, but five years from now will Facebook be a monster in location-based services? I’d bet yes. Facebook has such a strong market presence with retailers compared to Foursquare, but Foursquare users seem much more passionate. As a guy who uses all these services, I routinely say to myself, “What’s the point of checking in on Foursquare?” There’s not a lot of deals, there’s no coupons, it’s not like they have a sales force. I will not knock the community though. Foursquare users are super passionate, they are plugged in and connected, and they are the people you want to know.

Click here to read more Street Fight local merchant case studies.

This interview has been edited for length and clarity.

  1. Anonymous
    August 23, 2011

    Thanks for the write-up of our interview. We’d love any of your reader’s insights into how to better measure views/clickthroughs on these LBS networks.

    Tom Elliott
    Idea Greenhouse

  2. August 23, 2011

    Thanks for the input on the various types of LBS. I think that they do have the potential to drive a large amount of customers into the right company.

    However, the first question that comes to mind for me is what advantages LBS creates over concentrated advertising for such a unique product? LBS appears to work great for products/services done on impulse like buying a T-shirt or stopping at a burger joint but I would be hesitant to check out office space just because it was mentioned while I was drinking a cup of Joe.

    Also, your company is near the coffee shop, but do your target customers frequent that particular coffee shop as well? I am unaware of the demographic of the neighborhood but I wonder if the coffee shop is the best place to find web designers, independent marketers, and the other job types that make up your current member-base?

    I haven’t tried Yelp’s LBS but I think their review section would be an excellent way to draw customers in through word-of-mouth. On a related note, if you go onto 4Square and leave broad tips that are followed by an obvious plug to your establishment, I don’t believe that will work very well in today’s cyber-communities. Marketers do the same thing on social media websites like Twitter and Youtube so I believe consumer have already started filtering out these opinions as uninformative. 

    As a final note, have you considered ways to advertise in places where there are a plethora of individuals who are likely to take the road less traveled and need their own individual space? Attending Start-up meetups in the area, the local branch of financial traders, or even the lobby of a high rise apartment… seem like they might create a better ratio of interested participants than a coffeeshop that happens to be in the same building as your establishment.

  3. September 8, 2011

    Cameron- apologies for the slow reply, just seeing your post.

    Our contention is that a new brand/business needs to be seen to be explored, and LBS platforms give our green “G” a first exposure to a high value audience- other social media/web folks who might enjoy sharing our space.

    Our local coffee shop is not conducive to laptopping (dominated by university students), but good idea. We have a great relationship with them and I’d love to market there more.

    As for going to where the customers are, we’re relentless. Events events events- you can see our promotion of them here:

    In short, we’re new and untried in this market, so LBS offers a way to be seen in a low cost, place-based way. Someday I hope our LBS presence will have deeper impact, but we’re happy with baseline awareness for now.

    Thanks again for your thoughts.

Leave a Reply

Your email address will not be published. Required fields are marked *

Street Fight Daily: 08.23.11