Foursquare has made its advertising tools available to its 1.5 million registered businesses worldwide as it looks increase monetisation on its mobile platforms.
With rivals Twitter, Facebook and Google+ beginning to make significant ground with location-based small business advertising, Foursquare is under pressure to get its own share of the market before it loses relevance for its 40 million users.
The new advertising tools are intended to make clearer the effectiveness of Foursquare ads, letting advertisers know how many users saw an advert, how many clicks it received and how many resulted in a customer walking onto their premises. Users are able to set budgets for campaigns and access simple analytics, as Foursquare outlined in a blog post.
"All a business owner needs to do is go to foursquare.com/ads and build their ad – by choosing a great photo of their space and either offering a special or highlighting a great customer tip. Then they set their monthly budget and push their ad live for people nearby to see," it said.
"Any merchant can monitor how many people have viewed their ad, how many have tapped on it, and how many actually came into their store. Merchants know what they’re paying for – real actions and real customers."
Anthony Mullen, a senior analyst at Forrester, told V3 that Foursquare's tools would be attractive for smaller enterprises. "It's not attractive for a small business to set up their own location app, so they depend on these aggregators and middlemen," he said. "It's the right move for Foursquare to generate more spend on their platform."
Mullen said, though, that while Foursquare has plenty of good data to use it faces tough competition. "The apps which win in this game are the ones which are always running. Twitter has an advantage because they have the real estate of time."
In June, Twitter bought location-based advertising firm Spindle and as yet does not appear to have added Spindle's technology into its customer-facing products.
Nonetheless, the concept behind Spindle could potentially rival Foursquare when used by a brand with as much power as Twitter. "With Foursquare you have to actively open the app check in, so I'm not sure what the Foursquare USP is here," Mullen said.
Mobile advertising has been a hot topic for social media firms in recent months, with Facebook's stock price often influenced by how effectively the firm monetises its mobile presence. Twitter, meanwhile, is due to float on the stock market at some point in November, meaning it will have to demonstrate it can make money from all platforms as it seeks to eventually record its first profit.
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