THE DREAM IN ACTION

The number of brands that are jumping on the Foursquare train is awesome. We’ve been talking about the no-brainer that is engaging with your customers and it’s very satisfying to see it happen with such strong companies and brands.

Zagat

Mashable reports:

Zagat is calling the partnership “Foodie Love,” and there’s even a new accompanying foodie badge. Zagat.com is extending the partnership beyond Foursquare and starting a “Meet the Mayor” online interview series that will feature discussions with prominent Foursquare mayors.

Foursquare’s relationship with Zagat is clearly an answer to Yelp’s introduction of check-ins, especially given the trusted and prestigious nature of Zagat content.

Warner Bros.

You’ve all had a blast playing foursquare, and now the entertainment continues. Chris Dixon said that the next big thing would look like a toy, and take my advice here, Dixon knows what he’s talking about. No a game is becoming a way for movies and tv programs to bring the story off the screen and directly into the lives of viewers.

Through the promo’s & tips that these brands are offering, users/viewers can live vicariously through the characters. I’m so pumped on this. Of course, it wouldn’t be Foursquare without a badge to go with the campaign.

“Visit and check-in on Foursquare at any of the locations on our Valentine’s Day inspired list of the most romantic places in New York City, San Francisco, Chicago, Los Angeles and Boston to get a Valentine’s Day badge! Then go see the movie, in theaters on February 12!”

HBO

Now HBO’s new show “How to Make it in America” that has been compared to a New York based entourage, will also run promo’s through Foursquare. With 4SQ’s huge NYC presence I guarantee this blows the show up! What if the Jersey Shore guys gave tips? I guess nobody wants to live vicariously through them…

Foursquare’s first direct relationship of note was with the Brooklyn Museum. The museum saw the obvious value of visibility into who checked-in and decided to embrace the opportunity to directly provide it’s visitors with tips and tricks around the museum. The created an interactive experience and essentially a personally guided tour! Awesome. Other institutions saw the obvious value in this type of partnership and wanted in, as I said before, the people who get in early will benefit the most. Tristan is killing it in driving these partnerships and infusing compelling reasons for users to checkin and amplifying the value of the checkin.

Our next announcement was that Harvard University got on board by populating over 30 tips for both students and visitors all around campus. The cheeky headlines read, “Foursquare goes to school” and they were right. With Harvard U. on board Foursquare was learning that the potential for these partnerships were reDONKulous. Harvard used the Foursquare platform to populate a virtual tour guide with tips like…

@ Harvard Hall: In 1764, Harvard Hall burned down in a nor’easter, taking with it almost the entire College library & John Harvard’s book collection. (December 9, 2009)

@ Mr. Bartley’s Burger Cottage: An American landmark since 1960 & voted best burgers in America! Try “The American Idol” burger w/ bacon, cheese, mushrooms and onions. (December 8, 2009) [Link]

Can you imagine the potential of the worlds best location based social network and the worlds best restaurant guide teaming up? Exclusive tips from Zagat about the highest rated restaurants in major cities like Chicago, New York, and San Francisco becomes very interesting for the foodies out there. Did someone say Foursquare Foodie badge? I think so!

Oh snap, with a Foursquare/Bravo partnership 4SQ enters 90 million American living rooms and hits mainstream big timeness. BravoTV’s experts and celebs give tips about the venues they love so that when you check in, you’ll see their exclusive tips integrating your checkins with that of the BravoTV shows. Everything from Michael Cohen of Miami Social, to Patti Stranger from Millionaire Matchmaker…know you’ll be in the know like never before, and you can live vicariously through the shows and their stars.

@ Joe Allen: This is where the understated in-crowd always dines. You actually need reservations because the food and This is where the understated in-crowd always dines. The menu changes often but for lunch, the La Scala salad is so good!  Their fish selections are also notable. -Michael Cohen, Miami Social (1 day ago)

@ Dave and Buster’s – Hollywood: Sports bars attract hotties. That’s why I love the wings at Dave & Busters. -Patti Stanger, Millionaire Matchmaker (1 day ago)

The institutional partnerships are taking things to a whole new level. Foursquare was always praised for being a game that provided real world, offline value, but with these partnerships that value was just amplified.

Why raise $30 million to hire an enormous, nationwide sales force if you could use the power of existing sales teams for a fraction of the cost? Recently, I’ve been thinking about how startups can leverage other, larger, companies to build out their model. After all, a startups purpose for existence is to test their model. So why wouldn’t a startup leverage every existing system possible to keep costs low and test the model?

An increasing trend in startups, for good great reason, is to use Facebook Connect to leverage the existing social graph. Look at Foursquare, HotPotato, or OMGICU, all great examples of instantly connecting via FB connect to pull in all of your friends from likely your largest existing friend network. The time and wasted money that these startups would spend developing a brand new social graph is ridiculous.

There are so many opportunities for rapid growth through this type of “existing system leveraging”. With Foursquare I’ve been working hard to get as many venues involved and offering specials in the application as possible, so why wouldn’t I take my own medicine here. I try to use, excuse me, partner with the people who already have relationships with these venues. It turns out there are marketing teams who have great relationships with large groups of bars and restaurants, working directly with these people may bring in 10-20 venues in one fell swoop rather than me pounding on each venues doors individually. Or, another example is liquor distributors? They have strong relationships with bars and can possibly influence the end price of the product to a customer who say, checks in on Foursquare…get it. There are sales teams that work with these people and have a system in place already like Coke, or Zoom media (those ads above urinals), etc. etc. etc., the list could go on.

Whether you’re building a social app, or a utility that sits on top of the ’social graph’ I’d encourage you to look at ways to use existing systems, social or otherwise, as your best distribution channels. The cost is likely lower, and the impact likely higher.

What existing system have you leveraged?

Last week Mashable ran a poll to find out which location based service YOU like the most (I say YOU because I’ve learned that the folks that read this blog are likely the type to also peruse Mashable on a regular basis). I was very please to see the result here, obviously, and I’ve been giving the battle for best location service a lot of thought. What does each service have, not have, and have the potential for?

I decided to use something that is very easy to analyze, a car, to explain what I think each service offers…or doesn’t. I’d love to hear your thoughts in the comments.

Gowalla is too gamie. The feedback I’ve gotten from all of my friends who use Gowalla is that it’s so tough to figure out. There might be free iphones and tshirts hidden around town but those gimmicks fade quickly. Because of it’s overly gimmicky nature, like the PT Cruiser, I think it’s shelf life is very short. Where other services will beat Gowalla, and likely already have, is that they’re useful, they’re a service and people only play games for so long. There’s got to be user utility otherwise I’m out.

Yelps recent entrance to the location services game is on the surface appealing. They do have a lot of venues to work with but it’s clunky, not social, and ultimately not fun. Although mini vans are super effective cars, they fit kids, surf boards, Christmas trees and almost anything else, but they’re not fun to drive at all. Trust me I drove one all through high school, and although I was awesome (or so I thought), my ride was not. :) Yelp is too much on the service side, the game mechanics that other services bring to the table will win out in the end. Phin Barnes of FRC recently wrote about how gaming mechanics will be critical to all social applications in the future and this is where yelp fails, no community.

Ultimately Foursquare has the best combination of social and utility. It may not be the smoothest ride (yet), but it gets the job done better than anyone else and it’s fun, a powerful combo. The foursquare app can fit your friends and your fun into one ride. Like an SUV foursquare is enjoyable, you can be proud of what you’re driving because the community is a strong one, and your friends will think your cool :)

Although I’ve used all three of these applications, foursquare still blows the others out of the water. Yes, I’m biased (disclosure, I’m working w/ foursquare) but, I don’t see how the others are going to cross the chasm into true social utility. Because foursquare was built for that purpose from the ground up it will win.

Most people know that Google’s precious search algorithm is a secret, sacred, thing that they’ve worked very hard to protect. In fact their behavior around that algorithm has been similar to Golum’s behavior towards his “precious” ring. You know, the one that will ‘rule them all’. This algorithm and others allow Google to provide very focused advertising based on your search terms.

In computing, an algorithm is an effective method for solving a problem using a finite sequence of instructions.

However, the way I see it, their dominance in providing web advertising using the “precious”, all machine, set of instruction won’t last forever. There are human powered systems that can adjust quickly for variables, change over time, and become increasingly “sharp” as they learn. Simply, they can learn better than just a computer. A great example of this type of human powered system is a NYC based startup Hunch. Effectively, they’ve created a system where they can collect an infinite number of decision trees, all generated by humans, and then predict future decisions based on passed decision sequences.

So, what am I getting at? Well, as you know I’ve been working closely in the local advertising space through my work with Foursquare and I can’t stop thinking about how large of an opportunity this is. If a bar or restaurant can advertise directly to the folks driving by as they’re deciding where to eat, that’s better than any billboard, radio spot, newspaper clip, full page magazine add, event sponsorship, Adsense ad in my Gmail or Google search, and I could go on… It’s simply the best possible advert you could get, as an advertiser or a consumer, unless I’m missing something. Here’s an example, when companies spend money on other ‘focused’ internet advertising they pay for say 100 impressions. This means that 100 people saw that ad, and the common click-through rate is about 1/100, even on the ‘focused’ ads. Now, what if you were able to directly reach potential customers who frequent your ‘type’ of establishment, fall within a very specific demographic, and only if they’re walking distance from your location!!! Right now you’re saying, “WTF are you serious…”, and I am.

With the blowing up of location based services like Foursquare, Loopt, Brightkite and a few others, this sort of data is readily available. People are using these services to share their location, their purchase preferences, their unfiltered thoughts about almost everything they do and businesses can learn A LOT from that. Now you see why all these nerds (me) get excited about data; because you can change the world with it. With this data you can turn industries upside down, and the ability to reach consumers in this intimate way is one of those opportunities.

It’s all a matter of who can reach the masses, who can create a product intuitive enough for “Joe the Plumber” to use. Google’s Adsense technology is fairly simple, but still local businesses don’t use it. The potential for human powered mobile, local, advertising is in the words of Austin Powers, “dead sexy”. My mouth is literally watering. I can’t wait to be a part of this movement.

Update: This post is going to be syndicated, and I made some additions/updates for that reason. 1/5/10

Have you heard of Waze? It’s a mobile app that serves the purpose of a Garmin or any other navigation tool except it has the ingredient those other tools are missing — remember the one that I keep telling you will start to integrate in any successful application — social. With Waze you can report traffic, speed traps, construction zones, and basically anything else that’s going on that might affect your drive or the decision of which route to take, Waze even builds it’s map because off social contribution.

Like any social app there is a catch-22 in that the more people play, the more valuable it will become. Waze says safety first because if the GPS in your phone tells the app that you’re driving it will disable your ability to text at all (very cool). Waze has made some changes recently in the way that it compells participation that you should take a look at… read on.

Here’s a few screen shots:

As you can see by the pac man-esque figure in the screen shot, Waze is a game. You earn points for finding new routes, trekking and exploring new roads, reporting issues, or findings along the way. It becomes fun if you’re engaged in it. Like any game if you’re on the outside you’re probably not going to get it or have that much fun, but if you dive in it gets addicting.

Now games are colliding; Foursquare is allowing checkins via Waze (as you can see in the screen shot above). There are even badges for checking in a certain amount of times through Waze. The online world is becoming a game, all interaction is rewarded and more and more we’re seeing those rewards offline, not just stuck on the web.

If you’re using Waze now I’d love to hear what you think of it. What are the best uses, what’s compelling and what’s boring, and are you checking in via Foursquare?

Below: Some of the official announcement about the badge via foursquare and the gaming mechanics in Waze

Waze recently added ‘road goodies’ – small icons worth bonus points – to the map in areas where the waze system has identified map problems. As users drive around to munch these ‘goodies’, the system analyzes the driver’s GPS data to automatically solve the identified problems, improving map quality, and therefore navigation, for all drivers in that area. The holiday version features wintery, new ‘road goodies’ including snowflakes, candy canes and small gift packages, scattered all over the map.

Taking the gaming aspect of waze even further, this version also features an integration with Foursquare, a new location-based geo-gaming app with a lot of buzz. Users of both apps can now ‘check in’ to various locations on Foursquare via the waze client – a feature that’s sure to become very popular – and even earn a waze ‘roadwarrior’ badge.

Here in Chicago we’ve been building a really solid group of users who are excited enough about Foursquare to tell their friends and the venues that they frequent. Last night we all met up at Lincoln Station in Lincoln Park and chatted about our experiences sharing foursquare and some of the challenges we’ve faced in spreading the word. If you’re interested in joining us next time or talking more about 4SQ, shoot me an email ryan@thedreaminaction.com

More Cupcakes was kind enough to sponsor the event and made some Foursquare branded cupcakes with a Mayor badge. Check out those crowns!

I’ve been pondering, in great detail, the challenges of getting “old school” brick and mortar business to better understand, then implement the enormous value that certain web based tools could provide for them. My first observation is that it must happen in that order, understand, then implement. My second observation is that it must be in their terms and must align with their ‘current’ business goals (I’ll elaborate on that).

A friend who works at a major consulting firm asked me for tips on how to use Twitter for his firm. My advice was, “You’ve got to understand your business goals before you have a hope of using Twitter (all social media) correctly”, and the same goes for bars, restaurants, and retailers. Here is what I would be doing if I ran one of these types of businesses…

I’m going to play the role of bar owner for the example here, the same principles apply to all.

1. Identify the value for the “key players”

There are two key players in this game. First and foremost are my customers, without them I’m dead so there interests should come first. My goal is to drive them to my venue. Second, are the investors or owners of the establishment. If an action pleases one and pisses off the other it won’t fly. Mutual benefit is critical.

Customers

It turns out that my customers are becoming passionate about things I don’t even really understand. It’s not productive to bitch out it, it’s my job to learn and get on their level. People are playing web based games that can literally determine where they go next. Customers are following their friends, broadcasting their locations, following friends recommendations, tips, and reviews to make consumer decisions and I have to be paying attention.

Venues

Turns out this crazy new game allows me watch! I’m invited to this party…for once. And because it’s location based I can track their interaction with my bar. Details like who’s coming to me, how often, who they’re with, and what they’re saying about me are mine for the taking. Not only does it let me sit on the outside and observe, they let me engage and play the game, even better, they let me make up the rules! Parker Smith wrote on this blog, ‘r+d’:

Foursquare provides a dead simple and engaging platform through which any small businesses can establish a loyalty program.

Venues can offer specials and determine the incentive for game players (who by the way are our most passionate customers) to come back, and spread the word.

2. Measure the value

Now that my eyes have been opened to the world of technologies that can literally change the way I interact, monitor, and reward my awesome customers, why not make that physical interaction a bit easier? Introducing Square: Twitter inventor Jack Dorsey just launched a biz that is a new way of accepting payments that, oh by the way, allow you to track customer spending. Here’s how Foursquare and Square play well together… (diagram from Hutch Carpenter)

The social incentives remain on the Foursquare side, it’s fun, and people are rapidly spreading the word. Now, from a transactional standpoint, I want to see what kind of $cash$  this is bringing in and revolutionize my conversion and merchant process and significantly increase my visibility to all of it.

Now by using this tiny device that plugs into an iPhone (or another smart phone soon) and can accept credit card payments, I know who’s coming (from Foursquare & Square), I know who is with them (from Foursquare), and I know how much is being spent (from Square), and I know how often they come (from Foursquare & Square). The ultimate customer monitoring, visibility, and analysis has arrived. It’s just up to me to keep my eyes open, continue to learn and use the tools available to me.

Conclusion

I better understand my business goals of attracting and converting customers and I’m using the tool that they are having fun with to monitor and act on their behavior. That’s mutually beneficial. I’m not selling them anything they don’t want, I’m connecting on their level and learning more about them. I’ve taken the time first to understand why these tools will help my customer and me and I can easily implement it. Very simple, very engaging, very affective.

It’s almost as if Foursquare was meant “for Square”.

image via flickr

For a while now I’ve been writing about Foursquare customer development, sales, and business development. I’ve written about my experience as a foursquare sales rep and the challenges of selling to local venues. Now, I’d like to share some of the details of my newest project and what we’re going to accomplish.

I’m extremely excited for this project because of foursquare’s opportunity and potential to change the way business is done.  The challenge of reaching local venues is incredibly difficult and the only successful method to date has been to deploy a very large sales force. Yelp and others have used this method but in my mind traditional methods are not very exciting. What if there was a new way to sell at the local level? What if you could reach venues through their customers and create a win win experience that benefits every party? The possibility of that win win is very exciting, innovative, and exactly what we’re going to build with the Foursquare Street Team.

In the movie ‘The Patriot’, Mel Gibson builds and leads a militia to attack the British in a way that they had never seen, on the ground and by surprise. The normal sales approach has been the equivalent of the “line up and shoot at each other approach” of the pre-American Revolution British Army and what we’re going to build is a quick moving and innovative militia. This “street team” is made of up passionate foursquare users and passionate customers who want their venues to benefit from the value of being connected to customers like never before.

Our next step is forming this street team and empowering them to show venues the value of foursquare. If your an excited foursquare user, see the value of the platform for venues and users, I’d love to speak with you. We’re going to kick this effort of initially in Chicago and expand from there, so please get in touch. [ryan@renliv.com]

Here’s where we are now.

Existing Chicago Foursquare Promos

@ Chaise Lounge: Show that you’ve checked in on Foursquare and get 10% off on food.  Show your waiter to redeem!

@ Dragonfly Mandarin: Show that you’ve checked in on Foursquare and get 20% off every 6th visit!  Show your server to redeem

@ Piece: Show that you’ve checked in on Foursquare and you’re mayor and get your second pint on us! You can also follow Piece on Twitter

@ The Drawing Room at Le Passage: Show that you’ve checked in on Foursquare to the Drawing Room and get a free dessert with the purchase of an entree, small plate or drink. Show your waiter to redeem! Follow the Drawing Room on Twitter

@ David Burke’s Primehouse: Show your server that you’ve checked into David Burke’s Primehouse on foursquare and we’ll send out a complimentary chef’s choice appetizer to add to your breakfast, lunch or dinner. You can also follow David Burke’s Primehouse on Twitter

@ J Bar: Show your cocktail server or bartender that you’ve checked into J Bar on Foursquare, and receive 2 cocktails for the price of 1 before midnight.

@ Metropolis Rotisseria & Annettes: Show that you’re mayor of Metropolis and get a free brownie!

@ Meze Tapas: Show that you’ve checked-in on Foursquare and get 20% off meal with purchase of a pitcher of house sangria.

@ The Food Feastivals: Show that you’ve checked in on Foursquare and get one free admission per paid $10 admission!

@ The Hunt Club: Get a free shot with a foursquare check in, show to staff to redeem!

@ The James Hotel Lobby Bar: Show your cocktail server or bartender that you’ve checked into The James Hotel Lobby Bar on foursquare and receive 2 cocktails for the price of 1.

@ Wow Bao: Show that you’re mayor of Wow Bao on Foursquare and get a free 6-pack of bao!

You can follow Wow Boa on Twitter

@ Wow Bao – Chicago Loop: Show that you’re mayor of Wow Bao on Foursquare and get a free 6-pack of bao!

@ Wow Bao – Water Tower: Show that you’re mayor of Wow Bao on Foursquare and get a free 6-pack of bao!

Events are the things that bring us together, in real life, around a specific topic. Whether it’s a Victoria Secret Fashion Show, or a Monday Night Football Game, or an app launch party, people collect together in real life or with a shared common experience like watching the same TV show at the same time. Increasingly, the discussion around those events is becoming interesting and profitable.

Google and Bing, who do search better than anyone have realized that the real time conversation is incredibly valuable, which is why they both have agreements to use Twitter data — live conversation information.

I had a conversation with Justin Shaffer this week and he described the service as “collective storytelling”. It brings people together around an event so that they can discuss it. When I checked in at Wrigley Field for a Cubs game, Foursquare told me there were 8 others at the game who had also checked in. Now Hot Potato allows the people at the game, and the ones at home watching in engage in discourse.

Within Hot Potato you can add comments, images, or video to add to the conversation creating a powerful social network of people who experiencing something together. The service can currently be reached through their website but is optimized through the iPhone app (they’re working on other app platforms). Hot Potato also leverages Facebook Connect so no need for yet another username and password. When it comes to sharing the conversation and drawing others in, you can share the updates to Facebook or to your Twitter stream.

Where the Twitter hashtag does a decent job of measure how many mentions a topic has gotten and picking up trending topics, Hot Potato allows for a better use of that conversation content. Most people have heard the phrase “content is king”. That’s wrong now. Shaffer pointed out in our conversation that content is losing out as the most important aspect of experience. Now the social interaction is king. The conversation that is building around topics is more important that the event itself in some examples. Would anyone care about the Tiger Woods fiasco if people weren’t talking about it like they are? Doubtful. The interaction and conversation is now the most important aspect and Hot Potato now curates that better than anyone.

iTunes link to app here

Hey have you checked out Foursquare?

Is that the Twitter thing?

You can use Twitter to tell people where you are, via Foursquare. So not really a Twitter thing…

Go on…

I recently had this conversation with a non techy friend of mine and it made me think about how quickly things are moving on the web, and how God awfully confusing it must be for someone who doesn’t follow it like we do. That’s why when I heard the quote, “In 2009 if you’re not confused you’re not paying attention” from Bob Johansen of Institute for the Future, it made me stop and think. He really is onto something. When @msuster retweeted that today I could help but follow suit because of how well it explains what is going on.

It’s important for us tech folks to take a step back and put ourselves in the shoes of the non web savvy folks out there and figure out how to relate our fast paced industry to the rest of the world. Let me break it down in one statement: These aren’t just fads, toys, or goofy social networks, these are the tools that will make our lives easier in the future. Over time the good ones will rise and the less useful ones will die, but paying attention to how they develop will give us the understanding we need to utilize them and succeed.

For the critics, you’re absolutely right that you don’t need to pay attention to all of the noise out there, it’s impossible to. But what you do need to do is learn to pick up on the ones that stick and don’t be late to the party. If you’re just now joining Facebook you’re late. It’s going to be critical to at least try to comprehend these trends so that you can stay competitive no matter what business you’re in. Pay attention to the future no matter how confusing it may be.

image via flickr

Before I left on the honeymoon I was interviewed by the Chicago Tribune about my use of and help with Foursquare, the article turned out awesome! I hope this leads to more use in Chicago.

Here’s the quote…

“I probably don’t call and have phone conversations with people as much as I did because I already know what they did on Twitter. I’m in constant contact with them.” said 26-year-old Ryan Graves, owner of Renliv LLC, a Web development and Internet consulting firm. “Now, with Foursquare, you don’t need to tell me where you’re going.”

The other day, for example, Graves said he couldn’t reach friends by phone or text messages. So he jumped on Foursquare and learned they had checked in at Halligan’s in Lincoln Park. He just went there and met them.

Great article @littlewern, and thanks for letting me help.

I’ve been thinking a lot about customer development over the past few months. It’s a new way of thinking as a company, it’s a new way of approaching marketing, product building, and customer service. It’s changing, or maybe already has changed, the way companies think about the relationships with their customers, and it’s never been easier to employ this strategy than in early stage technology companies. And that’s exciting.

One of the smartest pieces of startup advice I’ve heard in a while was Andy Rachleff of Benchmark Capital saying, “The most important thing to look for in a founder: Authenticity”. (thanks to @TristanWalker for pointing me to this quote) The same goes for evaluating a startup as a whole, is the corporate philosophy of the company true to it’s actions? Is the company authentic about what they tell customers and partners? Take Comcast for example: They say they are listening to customers, they have a large team scanning twitter to make sure that customers voices are heard, but they sure as hell don’t seem to be listening to customer feedback about their phone support, or cable and internet packages. In short, it’s terrible. They’re not using customer development to drive their product offerings. True customer development focused startups make this a priority, and that helps them brand themselves as authentic.

Companies that that make learning a priority are exciting and they’re the type of companies I want to work with.

Today I was in a mtg about how GE will work to reach out to potential job candidates. Surprisingly, the recruitment practices are on the cutting edge of listening and reaching out to candidates and meeting them on the platforms that they use. They’ve abandon the “they’ll come to us” mentality that will fail every time. I don’t care if it’s a 2 person startup or a Fortune 2 behemoth, you have to listen and engage in customer feedback at the customers level or you will no be able to accurately road map your product.

Similarly, with the work I’ve been doing with Foursquare the team is very interested in the user feedback. To the point that they are intimately aware that the game must develop with user feedback in mind for it to remain compelling. With the recently inclusion of deals ‘in-game’ it’s only become more valuable for users. In the past it was just fun, now Foursquare is benefiting users financially, and that has staying power.

LEARNING companies solve problems quickly while remaining true to their strategy. LEARNING companies keep users and customers happy even when they don’t give them everything they want. LEARNING companies focus on long term value and they don’t let their products get stale. LEARNING companies measure the metric of user/customer engagement and realized that there is valuable data to be measured there. LEARNING companies listen.

If there is one thing that will be consistent with my career, I want to work for LEARNING companies.

image via flickr

In a recent project, I’ve been doing customer development here in Chicago to help out Foursquare. If you’re not familiar with customer development it’s gathering feedback from potential customer on what they’d like to see from your product in order for it to be of value to them. It’s been a fun experiment in biz dev and a wake up call to the difficulties of door to door sales pitches, but I’ve received a lot of great feedback. Below I’d like to share more of the findings of the experiment. Here’s post 1 and post 2.

Restaurants are scared of new

The overwhelming theme in speaking with restaurateurs is that ‘new‘ is scary. The reason why new is scary is because new costs them time. Time seemed to be their most valuable asset and learning takes time, changing takes time, adopting new takes time. In the tech world it may even be our business to know what the next trend will be, that doesn’t matter in restaurants.

Problem: I’ve found that only savvy business owners get the benefit of online. Forget iPhone apps and mobile social computing, they may not even have a web enable device in their restaurant at all. A few solutions to these problems rose to the surface in my discussions that I think will ease the adoption issue of a new technology.

Solution: Remove the need for opt-in participation. This at first might sound scary but hold on. This isn’t a “we’re going to force you to participate” play, it’s a “we’re going to help you whether you like it or not play”. If foursquare found existing deals that bars and restaurants were running to pull into the system they wouldn’t need to convince bars/restaurants to opt-in. If you know Thursday is $1 beer night at the local watering hole because of the drink specials app, post that deal within foursquare. Then when the user goes, they’ll say to the bar tender, “I found this deal on foursquare, this is awesome”. The user becomes the sales rep, and the bar becomes intimately aware of the value foursquare provides.

Cost of current coupon system

As a part of this round of feedback, I spoke with a marketing professional who sells to restaurants often. I wanted to know what his challenges were and how he overcame them. As always, if you’re doing something tough you might as well get smart experienced folks to give you advice. Why bang your head against the same door they did?

In this conversation I learned some techniques to make my pitch ’sexy’ to bar and restaurant owners.

Showing them their costs. By figuring out what they were already spending on coupons, deals, and existing promotions it was very easy to show them the value of foursquare. Many restaurants spend $500/month or more on ‘Money Mailer’ and other coupon systems, and they have metrics on the amount of people that actually take advantage of the deals. Well guess what, with foursquare the cost of distribution (virality) is significantly lower, thus inserting foursquare as your promotion system returns a much higher ROI. It’s simple, bar shares a deal with foursquare, foursquare share the deals with users, users come to your bar. 1, 2, 3. Cash money.

Limiting the downside of excess coupons

One thing I found when talking to bar/restaurant owners is a fear of the downside. I think maybe they’re pessimists by nature, not sure. Either way, a common concern they had with the foursquare model is, “what if too many people come in for the deal, how can I control it?” They were worried that the Mayor would change everyday and they’d be stuck giving out tons of freebies. A feature that was requested more than once is the ability to record the # of times a person takes advantage of the deal giving them the ability limit abuse. Whether by limiting point incentives or other “in-game” techniques, I don’t see this as being a long term problem.

I’m sure I’ll have more in a couple weeks…

image via flickr