Foursquare now allows small businesses to advertise on its platform
What: Foursquare has just announced its advertising platform is now open for businesses of all sizes, all over the world.
Why is it important: Social networking sites have evolved and are finding creative, useful ways to monetize their platforms, through well-planned and previously tested initiatives.
Since it opened its platform to a limited number of large advertisers, about nine months ago (launching a self-serve version later on, for some selected small businesses), Foursquare has been aiming towards the evolution of its business so as to better serve its 40 million users worldwide, moving forward from being a simple "check-in app" to proving it has a true monetization advantage, specifically in terms of advertising spaces within its platform. Today, the company has unveiled its latest development on that front, Foursquare Ads, which is now open for advertisers of all sizes.
Beginning today, small businesses all over the world will be able to create their own promotions directly on Foursquare’s ads dashboard. Foursquare is banking on its location-based check-in services to set it apart from competitors like Google and Facebook, as engagement will be measured by how many people actually visit the place in question, and advertisers will be charged based on that.
This is the first at-scale global platform that lets small businesses all around the world buy on a hyperlocal level to find nearby customers.
–Steven Rosenblatt, Foursquare’s chief revenue officer.
According to TechCrunch's Ingrid Lunden, Foursquare is hoping to tap into the 1.5 million small businesses that have already registered their businesses for free on the service (that’s up from 1.3 million in April this year). While registering will already make those businesses discoverable through Foursquare’s apps and website when people search for restaurants or other services in their vicinity, the idea here is that buying ads will give these businesses an extra exposure lift.
For now, the ads will be running just on Foursquare’s own mobile and web platforms.
The advertisement-posting process is very simple, because "so many small businesses are still lacking in digital and social media literacy", says Steven Rosenblatt, Forsquare's CRO. "“They don’t really know what a like means. They don’t really understand clicks for that matter.” Forbes reports that an action at a coffee shop, for instance, where consumers are only likely to spend a few bucks, might cost the advertisers $1 to $3, while the same action at an upscale restaurant would probably be $5.
Mashable's Todd Wasserman elaborates to say that with Foursquare's new self-service page, businesses can state their business needs and budgets, and Foursquare will do the rest.
"You can say, 'Here's the business I want to drive traffic to, here's how much I want to spend and here's my monthly budget. Go for it,'" says Noah Weiss, Foursquare's director of product management. Foursquare will provide metrics for the ad, including the number of views, actions, action rate and cost per action.