Foursquare has over 10 million members that have checked in more than 750 million times to about 15 million venues worldwide, and was recently valued at $600 million after its recent $50 million round of financing. However, the social network lacks in revenue and reportedly will start charging the 500,000 registered merchants on the site a fee to access the Foursquare services suite.
The ability to check in is benefiting both store owners and consumers. “Now we’re able to close that circle,” said Foursquare co-founder Naveen Selvadurai. “[The check-in] comes back to me in forms of recommendations. It goes back to [users] in interesting ways.”
$50 million investment the company recently received will be put towards a dashboard designed for businesses to use. “The [merchant] tools allow you to claim your venue and start running specials and see the dashboard,” said Erin Gleason, Foursquare’s media liaison. “That’s all free right now, but it’s obviously very valuable data. So in the future when it’s a little more robust we see the potential to monetize that.”
This maturation leading to a real revenue stream is something many social sites (like Facebook and Twitter) have struggled with. Switching over to paid services can be tricky when businesses are used to getting those items for free, but eMarketer analyst Noah Elkin notes that “there is value in the analytics they can provide a merchant.
Source: NY Post
