The Rise and Growth of Social Location Applications

The impressive proliferation of Social Location Applications has been hard to ignore with the recent tech media and blogosphere’s enamourment of the space. Facilitated by the ground-braking usability of the iPhone and Android platforms, a number of start-ups have been able to combine geo-location with social and gaming features to launch several new applications which range from clever to useful. I’ve enjoyed tracking the space for some time so the following is a snapshot on a handful of the more interesting applications and a brief future outlook on the space in general.

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When thinking of an ideal social location service a few questions are automatic: Does it facilitate my meeting and staying in contact with friends? Is it fun and engaging? Does it help me discover what’s around me in terms of places, events and activities? Is it easy to use and available everywhere I go? Does it have long-term usefulness? Ultimately these questions address the Stickiness and Usability of an application – in this case as follows:

Stickiness = usefulness + entertainment + social interaction

Usability = available content + locations + devices + ease of use

Foursquare – The first to combine clever gaming features with location updates, Foursquare has enjoyed the advantages of being the media’s favourite throughout 2009. Backed by the same investors of giants like Twitter and Zynga, they’ve also led their social location competitors in terms of user-acquisition.

Stickiness (3.5 out of 5) – The Foursquare application allows people to earn points by “checking-into” locations and sharing that information with their friends – cleverly including those on Facebook and Twitter. Title badges (mayor-ships) are earned for being the most frequent visitor to a single location, which encourages competition among users – though initially fun, this model’s appeal is arguably short-term. The information shared among users is a pin-on-a-map visual with a brief “I’ve just checked into” message – useful to nearby friends who may want to meet-up or compete for a mayor-ship, but not ideal for those who are interested in discovering nearby places, events or activities.

Usability (3 out of 5) – As I write, Foursquare has announced a new upgrade that will enable check-ins anywhere in the world as opposed to the current list of a few dozen cities worldwide – which is currently a huge limitation to its growth and appeal. The application is slick and easy to use, is available for both iPhone and Android, with a full functionality mobile browser version for other smart-phones.

Gowalla – Though very similar to Foursquare with its focus on gaming and friend-tracking, Gowalla has managed to nail Foursquare’s shortfalls from day one: Unlimited locations, a slicker application and most importantly – the ability to scrape friends from Facebook and Twitter.

Stickiness (3.5 out of 5) – Gowalla, like Foursquare, relies heavily on a gaming approach to create its appeal. Users stamp their “Passports” when visiting places and compete for a mayorship-like Top 10 ranking at each location. Users can also pick-up or drop-off items (virtual goods) at different locations, with the ability to track who has “owned” an item previously. Gaming aspects aside, Gowalla’s virtual goods model is interesting as one can easily foresee how virtual items could eventually be traded-in for real items. Gowalla is initially fun and engaging but as with Foursquare – its focus on gaming and friend-tracking is less ideal for truly discovering what’s around you.

Usability (3.5 out of 5) – Gowalla can be used anywhere, users can simply enter new locations when these are not automatically detected by the application – which is currently available for the iPhone, with a near-full functionality mobile web browser version for Android and other smart-phones.

Flook – Launched in November 2009, Flook is the newest entry in the social geo-location space. Founded by the team who built Symbian (disclaimer: whom I’ve had the pleasure of meeting), they have taken a completely different approach from the gaming and friend-tracking model of other social location apps: a usefully serendipitous discovery of nearby places, events, activities and “things” via picture/information cards.

Stickiness (4 out of 5) – Flook allows users to take a picture of anything, add some text and a “Card” is automatically created with the picture, description, location map and creator info – which can then be shared on Twitter. Users can browse Cards from their friends, from a nearby location or search specific categories. “Flookers” can also collect points, introducing a light competitive gaming aspect and potentially, a future virtual goods business model. In its initial release, Flook has placed a lesser emphasis on the friend management features commonly found on other apps.

Usability (4 out of 5) – Another appealing aspect of Flook is that most content is created by its users and as a consequence – locations are unlimited and discovery is a pleasantly unpredictable experience. By browsing Cards, one is just as likely to find a hidden flower garden, a free power socket, a major landmark, a cozy restaurant or a local farmers market. A current limitation of Flook is its iPhone-only availability – but the application looks great and is intuitive to use.

Loopt – One of the first to enter the social location space with a simplistic  check-in and friend tracking approach – which has been replicated by a dozen or so other companies (Google Latitude included). Loopt claims millions of users across hundreds of devices, though suffering the recent media hype around Foursquare and Gowalla’s gaming model.

Stickiness (3 out of 5) – Loopt is currently focused on what can be considered the foundation service or starting point for any social location app: the ability to share your real time location with friends and track who else is nearby. Their first step in expanding beyond that is a recently added restaurant and event discovery feature.

Usability (2 out of 5) – The application is currently available on iPhone, Android, Blackberry and hundreds of other smart-phones…but only in major cities around the United States. Their map visual shows icons of nearby friends, restaurants and events and the app is extremely easy to use.

FUTURE OUTLOOK (Functionality, Monetization, Consolidation and Acquisition)

Functionality – Today’s Social Location apps can be broken down into three functional categories: Gaming-Centric (Foursquare, Gowalla), Discovery-Centric (Flook) and Basic Friend Management (Loopt, Brightkite, Google Latitude, etc). Most have understandably been focused on user-acquisition rather than monetization but surprisingly, only Gowalla has gone directly where users reside today to import people’s existing relationships – Facebook and Twitter. With the availability of Facebook Connect and Twitter APIs I expect most applications to implement a similar feature in the short term (most have already included the ability to share content across Facebook and Twitter).Privacy-oriented friends lists will become important once this happens as one may not want to share his/her location with everyone. Though I currently enjoy the competitive gaming features of the likes of Foursquare and Gowalla – we’ve learned from the social gaming space that social gamers typically remain active for three to four months – I would therefore expect the Gaming-Centric companies to expand their reason for being very quickly, particularly in the areas of usefulness and monetization.

Monetization – The social gaming space has reached profitability faster than any other social media business and they’ve done so by implementing a virtual-good centric revenue model. A model that can be easily adopted by the Social Location companies. Virtual goods/points, from a gaming perspective, are what determine “bragging rights” among friends. Users can earn virtual goods based on activities undertaken (check-ins, flooks, invites, viral activities like tweeting, etc), by selecting sponsored offers or by purchasing them directly. Virtual goods could be also converted into real-world products or vouchers. Brands could easily sponsor virtual goods in exchange for crowdsourced content (flooked cards, check-ins, first at a location, etc). Bookings could be integrated for places like restaurants, theatres, cinemas – which already exist for other types of applications. The same way users can choose to discover people, places and events based on location – they could choose to discover vouchers and special offers near-by: non-intrusive, truly opt-in and actually useful, with the added bonus of not having to deal with the intrusive targeted ads model so dear to most media buyers.

Consolidation and acquisition – Social location apps may be the one case where user-base has less of an impact on company valuation than what we’ve been used to across the social media space. Social relationships currently reside on Facebook and Twitter – which are also the most probable giants to move into the social location space as adding geo-tagging and friend location management features to their existing social networks is trivial – and potentially very disruptive. Either company is more likely to acquire a social location app which has nailed usefulness or monetization rather than a large user-base that they possibly own already. On the other hand, both Google (Google Maps, Google Earth, Google Latitude, Android) and Microsoft (Bing Maps, Messenger, Windows Mobile) already own interesting location, friend management, mapping, directory,  augmented reality assets and mobile operating systems but are lacking true social relationships and mobile-centric location applications. Social location companies across the three functional categories with a significant user-count may be their acquisition candidate of choice. Consolidation between two or more social location companies is also a strong possibility – Interestingly, a Flook-like approach to places, activities and events highly complements a gaming and friends-centric approach a la Foursquare and Gowalla. At the same time, a high-user base friends location management service like a global version of Loopt could be combined with a Flook for a killer service and company.

As always, opinions are free and debates are what blogging is all about – very much looking forward to your views.

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  • MartinSFP

    Interesting, in-depth look at the space. I think over time the novelty of location will wear off and virtually everything will have a geolocative nature. Many of the companies we see as hot properties at the moment will disappear. The transition period is going to be gripping…

  • lionsden

    I have just been able to sell LBA ( Location based Advertisement to one of our Biggest Operators in the Gulf countries ) and this is sth the customer through a business case can use to generate more revenues on SMS and royalties on advertising companies….I’d like to explore things in more details with you Sir…BR\Jamal Ericsson

  • woofiewoof

    Interesting writeup. Thanks. Surprising that you didn't mention Their app certainly has more users globally than all of the apps you mention put together. Reports were also out that gypsii has location-based coupons that have been widely deployed in China. I think they've also raised more funding. Gowalla has less than 70,000 users, whereas we've heard sources tell of gypsii adding 100-200,000 per WEEK!!

  • Cristian

    Thanks for the lead, gypsii looks like another interesting one. I have admittedly fallen prey to those companies who enjoy the US/UK centric media attention when having a look at social location services. Funny enough, as a result of writing this post – readers have pointed out no less than 20 other social location apps. Wish I had the time to check them all out…

  • Robert S

    As I am writing a thesis on this topic, can you indicate the 20+ other social location apps you're refering to? Thanks a lot. Robert S.

  • Cristian

    Wish I had the time to keep track on them all (or maybe glad I don't…). In addition to the four listed in the article, have a look at Yelp CheckIns, gypsii, Google Latitude, Brightkite, PlacePop, Streetmavens, Whrrl, iWassuu and most recently Google Buzz. Also keep track of Facebook and Twitter's own moves in this space.

  • Kieth Restifo

    It is nice to definitely locate a web site where the blogger is bright. Thanks for creating your blog.