Tuesday, September 21, 2010

Irresistible! The psychological pull of location-based services; what they mean for you and your best customers

Marc Sokol

Location-based services (LBS), like Foursquare, are fast becoming an indispensible part of your Smartphone. Elsewhere you can get a quick overview of how they work and how fast they are growing.  In this post we focus on the four psychological needs that get you to start and continue using these services.

1.  WIFM – information as a reason to check-in.  WIFM simply stands for ‘What’s in it for me?’ 

Even though it only takes a few seconds, we each need a reason to actually pull out our Smartphone and check in.  By far the main reason is the availability of information at your fingertips.  Find out what is playing at the movies and at what time, find a restaurant and see the menu, and read tips from others who have been there. YELP  has led the way in this respect, and like tattoos, people who have one LBS app for information probably have 4, 5 or more as well. Fandango, Urbanspoon, and OpenTable now seem as indispensible as having a wallet in my pocket.

How’s that for feeding your need to know it all and know it right now?

2.  No more accidental meetings – check-in to be found.   You know that sense of serendipity you experience when you run into someone you know at a place you never expected them to be?  No more.  With a location-based social network, you can see exactly who else is there and also checked in.

This feature is most engaging when you are at the mall, airport, park, movies or some location too crowded, too spread out, or too dark to easily find others by sight or the obvious meeting place.  Foursquare even awards a Swarm badge when 50 or more people are simultaneously checked into the same location. 

How’s that for feeding the social animal in you?

3.  Just to win – checking in as a competitive sport.  Information at your fingertips is easy to get as a motivator. But checking in to compete with people you may not even know? If you haven’t used Foursquare, it may be hard to imagine but another pull is the simple momentary pleasure of knowing you have checked in more than anyone else, at least for that week.  

Foursquare awards points when you check into a store or location. Multiple check-ins, more points.  Check in to enough locations, or often enough and you get awarded a badge (at least 40 different types at last count).  Check in to a particular location more than anyone else and your badge declares you ‘the mayor’. 

Who cares, you might think.  Apparently enough people do that that you can find a link appropriately labeled, WhenwillIbemayor , that tells you how many more check-ins you need to be mayor of a specific location. 

How’s that for feeding the Type A, “I’m number one” urge you have inside of you?

4.  Discounts and coupons – checking-in for financial reward.   Other than the curious psychic delight of being “the mayor”, why check-in so often?  Starbucks, as one example, provides a discount to the current mayor of any particular location.  Other businesses will offer a discount or something free after a number of purchases.  This is where data-driven marketers get the most lift from LBS and where we will see a lot of experimentation over time.

How’s that for feeding your coupon clipping capacity?

And what this means for you…

Marketing professionals constantly look for ways to attract prospective customers.  Providing immediate information for the goods and services people want does just that.  Connecting our need to be social with our desire for discounts and even the opportunity to be recognized for what we do opens another set of opportunities.   Add in the prospect of web analytics (who checks in, how often and when) and you begin to see new possibilities for data-driven marketing.  Not only can this tell you more about your best customers (at least the LBS enabled ones), it can tell you what they respond to.

If this hasn’t got you reaching for your Smartphone yet, consider the following story:

Two guys are camping when a bear approaches them in a threatening manner.  One guy slowly begins to put on his sneakers.  His companion says, “What are you doing? You can’t outrun that bear!”  He replies, “I don’t have to outrun the bear, only you.”  

Sometimes it’s not how fast you run, it’s whether you run faster than your competition. 

So what are you waiting for? 

Marc Sokol is an organizational psychologist with an eye for how people and teams can be more effective, even in a dysfunctional company. He is part of M Squared Group, a data-driven marketing consultancy.

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