From my research online, Foursquare's business model is simple yet amazing.
Foursquare was launched initially as an application that allows you to find a friend, track your location and at the same time play a game. In April 2010, within a short span of 1 year, Foursquare has managed to have 1 million users, and is being pursued Yahoo Inc., which offered as much as $125 million.
Seven months ago, Foursquare launched their beta advertising platform which is Foursquare for Businesses. This platform allows retailers highlight discounts or special offers relation to their rank to users who check-in nearby. Businesses will be able to get information about the users who patronize their stall such as:
1. Total number of check-ins
2. Special offers or discounts redeemed
3. Details of Customer including how often and the location they came from and the location they are going too
Foursquare for Businesses is a build on to the product; a necessary and critical addition to the basic application and it is this potential to advertising which enable it to be such a simply yet attractive business plan. If this current trend continue to expand and the audience continue to grow, marketers will definitely put money into Foursquare as part of their advertising effort.
Thus, the challenge is sustainability. Innovating to sustain or increase the interest of users, coupled with attracting more marketers to believe in this market through word of mouth or advertisements, would inevitably be the way in which Foursquare has to adopt.
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