Last year was supposed to be the year geo-location / location-based marketing (LBM) services like Foursquare, Gowalla and SCVNGR really took off. Well…they didn’t, at least not as fiercely as predictions would have had you believe. I’m not trying to rain on anyone’s parade or be a negative nancy, facts are facts. Foursquare only has 5.5 million users. That may seem like a lot but think about what that really means. There are nearly 300 million people in the United States, 5.5 million is about 1.8% of the population, not a huge market.
So this year I’m making a different prediction.
Geo-Location is going to continue growing at a slow and steady pace.
It will have dips and spikes but will not see rapid and overwhelming adoption. This will be true IF: These services don’t deviate too drastically from what they have now.
Here is the current paradigm.
- You “check-in” to a location (on a smart phone)
- You can choose to push updates to friends on FB and/or Twitter
- Receive an incentive if the business feels like it or knows about it the ability to do so
- Lather, Rinse, Repeat
If everything stays within that model, I predict slow and steady growth. The hurdles for most people are privacy and not caring enough to broadcast location and activity beyond Twitter or…
Facebook is the wildcard of my prediction.
The truth of the matter is that what it’s taken SCVNGR and Foursquare a year or two to accomplish, can be trumped by Facebook over the course of a weekend.
People are comfortable with Facebook in spite of the constant privacy issues and people are already spending a decent amount of time on Facebook. The most recent data I could find was from June 2009, at that time, a Nielsen report showed that the average user spends 4 hours and 39 minutes per month on Facebook. That’s more than Google, more than Yahoo, more than any other site on the internet.
Say ‘Facebook’ to ANYONE and they know what you’re talking about. Say ‘Foursquare’ and you’d be lucky if 50% knew what you were talking about.
Why do people use location based services at all?
- Incentives!
- Keeping up and meeting up with friends
- Crowd sourced location knowledge (Tips, Reviews, Suggestions)
That’s basically it!
In order for location based services to take off we need:
- More incentives, lots more!
- A critical mass of users (friends) for the network effect to take hold.
Keeping up with friends is only compelling if your friends and family use it. The more people using it, the more reviews and suggestions we’ll see. This likely means either consolidation or cooperation (between services).
Facebook Places
Launched in August of 2010, Facebook Places is off to a fairly slow start. The reason? Facebook places (currently) does, virtually, the exact same thing as existing services just without the gaming element (badges or challenges), without the tips, without many incentives available, basically it’s just a check-in with few places offering incentives yet.
But Facebook Places has a huge user base. This user base could be activated at any point if given the right reason.
Geo-Location is going to experience rapid, mass adoption.
What’s it going to take for my prediction of slow and steady to be flat-out wrong? One service needs to WIN!
Why is Twitter the most popular microblog? It WON!
Why is Facebook THE Social Network? It WON!
Winning doesn’t mean that others cease to exist. It just means that the competition is over and most people are using one service in particular.
Something that could help: A New Set of Awesome Innovations
I think that since most people are doing this stuff for the fabulous prizes and special offers then what we really need is a persistant check-in with push notifications of nearby deals that fit your profile and interests.
I’m personally getting tired of taking out my phone to check-in to Starbucks when they aren’t offering me a single thing. I don’t want to log onto Foursquare, SCVNGR and Facebook to see which nearby restaurant has a special. I don’t want to have to be the mayor of a restaurant to be appreciated as a loyal customer.
I don’t know what innovations will come in 2011 but we need something more substantial than what we have now or I stand by my prediction: “Slow and Steady”
What are your thoughts? Sound off in the comments.