User Motivations and Behavioural Patterns on Foursquare

Why people broadcast their location?

Foursquare and other Location Sharing Services (or Location Based Social Networks) have been used for marketing purposes from the begging of their existence. In order to investigate what value does those networks bring to marketers we need to understand what is the user’s motivation for location sharing. Well of course each of us knows why we broadcast our location to friends, but until its proved by science these are only personal impressions.

In the paper published in 2011 "I'm the mayor of my house: examining why people use Foursquare" Janne Lindqvist have investigated the topic. The quantitative survey with 219 participants revealed several motivators for participants that can have some relevance for marketers:

• Gaming, fun, badges – the most perceived value seems to be linked with the element of gaming, collecting points and badges contributes to the perceived fun of Foursquare.
• Social connection – interacting with friends seems to have a big value for users. The most important aspects are: knowing where the friends are and keeping in touch with them and checking-in to the same places and the same time. The social aspect of Foursquare is very important here, majority of participants claim that Foursquare is fun because their friends are using it.
• Place discovery – majority of users have discovered a new places or where motivated to go to new places because of Foursquare. Most participants where pleased with tips about venues that they have seen on the service. The discounts offered by venues were not that important for users – less than half of them addressed it as a motivation.

Where? When? How often?

The other significant issue is linked with the question: where when and how often do people check-in?  The same research displays on a figure below  frequency of check-ins for various places.

From the bar charts one can observe that restaurants and bars are the most popular places to check-in at even several times a week, which seems to prove the social and place discovery usage model of Foursquare. From the other hand participants hardly ever check-in at schools and homes, which might be caused by privacy concerns. There is a small group of users that are willing to share their home location and a bigger one that share work location even more than once a day. The survey showed that there are people who are interested in gaining as many points, badges, and mayorships as possible, and check-in everywhere.

The other reseach  by Cheng in 2011 investigated patterns from more than 22 million check-ins globally. Generated from the data tag cloud of the most popular venues that users check-in shows

that the most popular places are restaurants, coffee shops, stores, airports, and other venues reflecting daily activity (e.g. fitness, pubs, church). The result seems to prove several points from the previous paper presented. Cheng researched as well the temporal distribution of check-ins in the World:

 

This pattern provides a glimpse into the global daily activity intensity. One can observe there three major peaks: one around 9am, one around 12pm, and one around 6pm. 

Conclusions

The end purpose of social media is not to simply push out a message through yet another channel, but to deliver a message in a way that is both compelling and shareable, and that the recipients will want to share with their network. Marketers using Location Sharing Services must look at ways in which they can provide an interactive experience in-store that leverage the technology in the pocket of their visitors—an experience that will convert them from browsers to buyers and from one-time customers to loyal fans who act as advocates in both the real and virtual worlds. You will not do it with a simple discounts, the study proved the gaming and social aspect is more important. Discounts - yes, but make them more valueble and let customers be more engaged to get them. They will come back for more. Social-gamification - this seems to be the key to success. 

Location Based Services - emergency applications

One of the fundamental application of LBS is utilizing the ability to locate an individual calling to emergency response agency (911 in US, 112 in EU) who is either unaware of his/her exact location or is not able to reveal it because of an emergency situation. Based on this spatial information emergency response agency (e.g. ambulance, police, firefighters) can provide help in a quick and efficient way.

In 1996 the US Congress passed the law issued by Federal Communication Commission requiring all US mobile operators to locate emergency caller dialing number 911. In the first phase of the project required all 911 calls to be routed to the nearest public safety answering point (PSAP) and provide the PSAP with the telephone number of the originator of a wireless call and the location of the cell site or base station transmitting the call. In the second phase (2001) the wireless carriers where obliged to increase the accuracy of the geographic position of the caller up to 50-300m. 

European Union Commission has passed a similar regulation –“ Commission Recommendation of 25 July 2003 on the processing of caller location information in electronic communication networks for the purpose of location-enhanced emergency call services” based on Directive 2002/22/EC . This article asks EU states to develop national regulations for mobile operators enforcing the automatic positioning of emergency calls: “Member states shall ensure that undertakings which operator public telephone networks make a caller location information available to authorities handling emergencies, to the extent technically feasible, for all calls to the single European emergency call number 112’’. The difference between approaches in US and Europe is that EU in fact did not enforce mobile operators to increase the accuracy of caller’s location. Especially in
the USA initiative brought vast development of LBS technologies and infrastructure among mobile operators that allowed them to offer other services.

Data from Location Based Services can be used as well for disaster management. One of great examples is the Ushahidi platform - an open source project which allows users to crowdsource crisis information that was sent via location-enabled mobile devices, but as well published in the Internet, local media ect. and visualize it on the map to get the ‘real picture’ of the problem and manage rescue services in the most efficient way. The platform was found to be a great help during Haiti earthquake in 2010.

Another emergency application of LBS was released in the city of Portland in 2010. The city created open source platform where citizens are able to report problems with the city infrastructure via iPhone and Android devices using dedicated application - PDX Reporter.   It enables users to select the type of issue to report, take a photo, geotag it with GPS or interactive map, add comments, and send their report to the responsible bureau. Afterwards users can view issues they have submitted and check the status of the issue.

This Week in Location Based Marketing – Episode 57

"This Week in Location Based Marketing" is a weekly video podcast from the Location Based Marketing Association and Untether.tv by Rob Woodbridge and Asif Khan.

In the episode # 57 aired on December 26th, 2011 they're discussing:

Show highlights:
1. Brightkite shuts down service, to, er, rethink, yeah, that’s it.
2. Tennent‘s Beer parters with JiWire in Scotland
3. DDR launches ValuText powered by PlaceCast
4. Layar releases Stiktu for consumers
5. Hallmark Channel brings QR codes to TV

Product of the Week:
Zaarly: With special guest Eric Koester

Funding News:
1. Citysourced closes 1.33M Series A
2. LocationLabs buys Seeker Wireless
3. Tracks gets $1M seed round



source: LBMA

Types of Location Based Marketing

Marketers have many choices to location enable a campaign based on campaign objectives. In most of the cases Location Based Marketing campaigns are leveraging Location Based Social Media but besides that there are several different ways to promote the product or service making use of location and mobile device:

1. Location Based Social Media:  

Presence in Location Based Social Media including services like Foursquare, Facebook Places or Twitter gives possibility for a two-way communication  and direct contact with the customer. 

2. Check-in Based Contests and Games:  

Reward the user (typically with discounts or coupons) for visiting retailer locations and “checking in”. LBS  are used to verify that the consumer was at or near the retailer location at the time the consumer is checking in.

3. Geo-targeted Text and Display Advertising:  

The paid placement of a promotion or sponsorship message within mobile media that is integrated with LBS. Two types of targeting are common: 

a. User Targeting: 

Advertisers who wish to only reach users in a certain geographic area can use this type of targeting. 

b. Message Targeting: 

Presenting a different message to users based on their location. 

4. Embedded Icons:  

(Sponsored embedded advertising) the sponsorship deals can be map-embedded or on-the-page/in-app. Sponsored embedded advertising that displays without a search term but is based on end-user's interests and/or brand affinity. Icons or logos displayed in maps or augmented reality to help user determine relevant proximity/location.

5. Local Search Advertising:  

Advertising for listings of local merchant retailers. For example, CitySearch, Dex, YellowPages all fit in this category. Generally these campaigns will include some form of user targeting to show listings only to users in  a relevant geographic area. 

6. Location Triggered Notifications:  

Uses proximity information (Wi-Fi, Bluetooth, GPS or Network-based) to provide App Alerts or Messaging based on user preferences and opt-ins. These services can be automated (vs. requiring a check-in or app) and can run on both smart and feature phones. Once opted-in, alerts are delivered whenever a consumer is nearby a store, and can be tailored to a specific location (e.g. incorporating address or directions) and an offer specific to that nearby store.  

7. Location Branded Application:  

The usage of LBS technology to enhance brand-owned mobile media services. Media brands are the most ardent supporters of these apps. 

8. Click-to-X Routing:  

Routing either calls, data from broad campaigns to local call centers or localized information. For example a nationwide auto dealer might use LBS to route calls from a nationwide click-to-call campaign to the nearest  local auto dealer based upon the consumer’s precise location. 

source: Mobile Marketing Association

Podcast: Best Practices on Creating a Successful Location Based Marketing Campaign

Today I found this interesting podcast from Inbound Now with a guest Aaron Strout - co-author of Location Based Marketing For Dummies. It's really worth watching:

source: inboundnow.tv

What can we learn from LBS market forecasts?

This year I've seen release of several LBS market reports and forecasts: 

- Berg Insight

- Pyramid Research

- Strategy Analytics

- IE Market Research Corporation
- ABI Research

and other... of course like most of market reports they are massively expensive for an individual (starting from  €1500) but each of the companies provides more or less detailed summary, so:

What can we learn from them?

First of all that if there are so many new LBS market reports it means that there is the demand for it.  If companies are investigating the industry it probably means that they want to enter it. The market of location-based social networks (4SQ, Gowalla, FB Places, Twitter), and of GPS navigation is already saturated but there is an increasing need for a local search, local information, local news, local entertainment... consumers are getting spatially aware and so is the web. Significant part of web content is already geo-tagged. In fact some scientists say that web 3.0 is not semantic... Web 3.0 is spatial. 

But let's get back to the numbers. Most of disclosed data is pretty limited but it is possible to derive some knowlegde out of it.

Pyramid Research

Pyramid Research apart from its report has published video on the company's youtube channel that reveals some useful information.

We can see here that according to Pyramid Research B2C LBS market will grow from around $2.9 bn to $10.4 bn. Until 2012 the biggest growth driver will be navigation but from 2013 advertising will start bringing the highest revenues. The report highlights that sales of major GPS navigation providers like TomTom or Garmin is flattening. The competition in this sector is really intense especially when Google and Nokia are changing the business model from payment to advertising-funded. This is shifting revenue stream from navigation pool into advertising pool. We can see as well huge predicted growth in mobile advertising (from around $4 bn to $18 bn) and from the first graph it can be estimated that location-based marketing will account for around $6.5 bn out of it.
Moreover we can learn that smartphone will be the major navigation device and by 2015 dedicated PNDs will be account for less than 10% of the market and their sales is actually already declining. GPS enabled mobile phones penetration is forecast to achieve almost 100% in US due to E911 regulation  and in Europe this number will be close to 50% which is as well promising from LBS industry perspective.

ABI Research

ABI Research forecasts that US location-based analytics market is set to overcome privacy concerns and grow to reach $9bn in value (not revenues!!!) by 2016. It is very optimistic prediction but in fact it's probable as the analytics are the core provider of value in location-based advertising. The aggregation and analysis of location information to identify trends will enable new services and more effective advertising. Just to clarify it is important to state here that market value (the market capitalization plus the market value of debt) is something else than market revenues.

IE Market Research Corporation

IE Market Research Corporation - the Canadian-based provider of market intelligence released their 4Q 2011 LBS and GPS market report. The only free information that they provide are: "global market for GPS navigation and location based mobile services to rise to $15.2 billion in 2016, a CAGR (Compound Annual Growth Rate) of 22.7%". First of all by $15.2 bn they mean 'total spend' which is similar to 'revenue'. Than knowing revenues from 2016 and CAGR we can derive that they are predicting 2011 revenues at a level of $5.6 bn. And that would be all...

Thankfully they are revealing some more information in their 2010 report and youtube video. In 2010 they have forecast that the market will rise up tp $13.4 bn in 2014.

Comparing numbers from 2010 and 2011 we can observe that they are much less optimistic this year. In the table on the left I have compared both forecasts based on CAGR. We can see that when assuming stable growth rate, this year report predicts in 2014  $3.2bn less revenues then last year.

In the information revealed from 2010 report we can find again that they are forecasting massive growth of location-based marketing. Nizar Assanie, Vice President at IEMR said: “The future of GPS navigation and location based services is definitely in Location Enabled Search and Advertising. Location Enabled Search and Advertising will see the biggest growth in terms of market spend, growing at a CAGR of 131% over the next five years to reach $5.9 billion in 2014”.



Berg Insight


Berg Insight brings data about the European market. After a little bit of digging on the company's website I was able to find reports about European LBS market from three years in a row.

We can observe that Berg Insight was very optimistic in 2009. The company has forecast that after €214 mln in 2008, the following year will bring around €300 mln and will grow up tp €580 mln in 2014. It was a beginning of LBS not offered by mobile operators in Europe. The adoption of Location Based Social Networks was still very low. In 2010 the report verified over-optimistic predictions from the year before. The found out that in 2009 the LBS revenues were at the level of €220 mln. The market growth was minimal and Berg Insight was significantly wrong, that is why in 2010 the company was cautious and has forecast market to slow down and to reach the level of €420 mln in 2015. The latest report released just couple of day ago seems to prove the predictions. In 2010 the European market achieved €205 mln and is forecast to grow up to €435 mln in 2016. In North America, revenues are forecast to grow from US$ 620 million in 2010 to an estimated US$ 710 million in 2016.

Strategy Analytics


Finally the report of Strategy Analytics that managed to reveal the least number of information of any kind.  The forecast states that consumer and advertiser expenditure on LBS will approach $10 billion by 2016, with search advertising accounting over 50 percent.

Conclusions


What can learn from all those reports?
Knowing the industry we can easily say that the number of LBS users was growing every year. Despite that the revenues were growing very slowly and were significantly overestimated. Why is that? Although LBS are gradually achieving mainstream market acceptance there is still lack of profitable business models to monetize growing number of users. Google, Nokia and popular Location-Based Social Networks like Foursquare or Gowalla accustomed users to free services. To monetize it developers and provider are shifting LBS business models to freemium and ad-funding. There are however still several issues that need to be resolved including user privacy and geo-data pricing.

Advertising as a revenue and market value driver was mentioned in all of the reports. It significant role in the LBS market will start growing in 2012 and will probably reach in total much more than 50% of revenue stream. Parallel there will be whole new market for location-based services and marketing analytics as the companies will have to measure the rate of success of location-based ad campaigns.

From the other hand we can observe that operators are continuing to lose control over location information with the growth of GPS. In 2008 operators gained around 80% of all LBS revenue. Although now they are getting less than 50% of whole revenues the market has grown more than fivefold so they are still better off. The important question for the future is whether operators will use market opportunities to gain a bigger slice of this cake.

Up-date 21 Dec 2011: 
I found another market LBS report from Vision Gain research company:
Location Based Services 2011-2016: Monetising Opportunities and Challenges

Google LBS strategy - pushing forward the industry.

Google is pushing forward it's location-based features. Two days ago with the latest Google Maps update on Android market (v 5.12.0) it added live nearby events layer to Place pages in New York, San Francisco, Paris, Zurich, and London, making it easier for residents and tourists to find something to do while being on the move. Google seems to be accelerating it's LBSs by gradually adding new functionality...
It made me think about consequences of Google LBS strategy for the LBS market and it's players. 

Google location-based strategy

“There is something profound about location and mobile technology,” said Marissa Mayer, Google's VP of
consumer products at SXSW Interactive Festival in March 2011.  Mayer divulged as well interesting statistics - 40% of Google Maps usage is actually through mobile, which adds up to around 150 million

TomTom HD Traffic in Czech Republic - is the service entering Central and Eastern Europe?

Yesterday TomTom announced that it will launch TomTom HD Traffic service in Czech Republic. It will enable drivers to take the fastest route to their destination based on the most accurate and real time traffic information. Including Czech Republic TomTom HD Traffic will be available in 23 countries. TomTom claims that with 80 million probes (cellular and GPS) worldwide its HD Traffic service covers 99.9% of the road network, covering traffic jams on main roads as well as secondary and local roads.

Let's hope that this means expansion of HD Traffic service to Central and Eastern Europe (I'm looking forward to welcome this service in Poland :). However the market of retail PNDs is already very saturated in this region, the service is targeted as well to B2B clients with WORKsmart™ fleet management solution. In fact two days ago TomTom won 2011 GreenFleet Awards in IT Innovation category for its 'Eco system', which gives fleet managers the tools to promote and monitor eco-friendly driver behaviour, reduce fuel consumption and carbon emission = decrease costs. The system is actually based on a traffic data, therefore HD Traffic service expansion could mean one step further in the leadership in B2B fleet management solutions as well in this part of Europe. 

source: TomTom 

Google Earth hits 1 billion downloads

"Today, we’ve reached our own one billion mark: Google Earth has been downloaded more than one billion times since it was first introduced in 2005." - we can read on Google Earth blog. It's undeniable that Google changed the face of modern cartography and GIS. 6 years ago it was not that obvious but right now there are few who wouldn't agree with it. The way how people became concious about the spatial aspect of life is reflected in number of geo-visualization (geoviz) web services like Geocommons or ArcGIS online but as well in ingratiation of mapping GIS solutions in many ERPs and other business IT products.

Google Earth is not only very impressive but also very practical. With KML (Keyhole Markup Language) every computer geek in the world is able to produce content, add and analyse geographic data in a fairly easy way. (check this link).

"We’re proud of our one billion milestone, but we’re even more amazed at the way people have used Google Earth to explore the world," wrote Google Earth and Maps vice president of engineering, Brian McClendon, on Google's blog.

At Google's new OneWorldManyStories website, the company has collected stories from people worldwide about how they have used Google Earth "to follow their dreams, discover new and distant places, or make the world a better place," McClendon said.

source: Google blog

TomTom - Go Live 1535M - Social media in your satnav - is it really needed?

Announced on  Aug 29th 2011, TomTom's Go Live 1535M now expands to Canada.This model offers you dashboard tweeting and access to Yelp's recommendations. There are several useful things in there: first of all HD Traffic that is already working in 22 countries and users love it. There are Fuel Prices that help you to locate the lowest priced fuel on your route or in your area. There is Trip Advisor and Expedia to help you find and book a hotel, finally there is even a Google Local Search. 

Is it really needed?

There is one major question that comes to my mind when I look at this functionality: 


Why the hell would I use twitter and yelp while driving a car? 

When I want to use apps like this I stop my car and use my smartphone. But... there are couple of answers to that question:

• First of all, primo, you often go somewhere with passengers, so they might use it...
• Second of all, who is TomTom's target customer group for this product? According to the latest 2011 PEW Report 35% of adult Americans own a smartphone and according to Nielsen 74.6% of users of Android and I guess similar number of users of iPhones uses Google Maps (not counting in other navigation products) to get from place to place. This is clearly not a target customer group to TomTom but the rest of 65% of adult Americans are (!!!) and for them access to services like Yelp might be really useful.
• Finally it's quite an innovative product within the Personal Navigation Devices market, isn't it? TomTom known as the leader of the industry is proving its strength. They are as well getting some know-how in such a LBS solutions and probably soon you'll be able to share with friends on Facebook in a that you are stuck in a traffic jam while going to them, without being accused of lying.  

Who knos, maybe soon similar solutions will be available in build-in car navigation systems. But there is one problem Go Live 1535M is using GPRS connections to get data from the internet and it is already being phased out in some parts of US. The idea is cool. Let's hope that it's going to evolve in the right direction.

source: TomTom