Location Based Services: Where are the customers?

One of the things you’re going to be hearing a lot about this year is Location-Based Services (referred to as LBS by marketers). LBS combines mobile devices and the user’s geographic location with a myriad of business and personal applications. However, I’m going to limit context here to social media tie-ins and marketing opportunities for local, small businesses.

There is one thing you need to know about LBS as a small business owner and that one thing is Facebook. Why? Because that’s what customers use. An estimated 57% of the adult population in America is a Facebook user. If they own a mobile device, they are candidates to use Facebook’s location-based check-in feature.

If you have Facebook on your mobile device, you have already been exposed to LBS in both the newsfeed and home screens. Facebook mobile users simply check in on their Facebook app.


The Other Guys

You are likely to hear marketers also talking a lot about Foursquare and Gowalla. I advise that you go ignore that talk. It’s not that I don’t like Gowalla or Foursquare, I like them both (although I prefer Gowalla because it’s prettier). But while these applications are the darlings of marketers and techno-geeks, most normal people don’t even know they exist.

I recently did a mobile capability survey for a local business in my hometown. We wanted to find out how many of his customers were armed with smart phones and which mobile apps they preferred. We found that 31% of respondents had already checked in at a business on Facebook. How many for Gowalla and Foursquare? Nobody: 0% (zero percent).

That statistic should not really shock anyone. Facebook is ubiquitous and simple to use with it’s Places LBS feature. There’s no extra app required and there’s no signing up for additional services. The customer checks in and makes a comment. That’s it.


In November, Facebook made things even better with Deals. Easy for the customer to understand and easy to get incentives for checking in at a business. It’s even easy for a business to offer a deal (but still a little difficult for the business to claim their Facebook Places page). A local business can offer one of four different incentives to customers:

  1. Individual Deals – Available to any individual who checks in.
  2. Friend Deals – Available when two or more friends claim a deal together
  3. Loyalty Deals – Available to customers who check in multiple times.
  4. Charity Deals – When customers check in, the business makes a donation to a charity.

Facebook is simple for customers to use, and lots of them are already on Facebook (200 million mobile users). In addition Facebook Places is useful to local businesses, making it easy for them to offer incentives. That combination makes Facebook the one thing you need to know in location based services.

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