So, I’ve had a couple of conversations with people that have spoken with one of the founders of Foursquare. The general feeling they’ve come away with is “low grade frustration”. They can’t figure out how to get people to use Foursquare; more.

At 15 million users, this problem, at it’s worst, is known as Foursquare fatigue, where people just stop using the service because there is no real reward. The badges are cute but I can’t use the points for anything. They’ve now moved (a little) into Yelp’s territory but their real issue is that they are targeting their original users with additional functionality, which sounds really smart at first until you realize that those users are a relatively small bunch and the real business opportunity lies with the masses that have not adopted Foursquare. Those users don’t really care about the depth of interaction between other users and businesses. They have ulterior motives and they’re pretty basic. They want to see offers at the stores they frequent and if check-in based loyalty programs are the best way to see them, they’ll check-in. (Of course they appreciate the tips, etc but the reward

Foursquare has relationships with 500,000+ businesses and if they could insert themselves into the business/location marketing process, they could prove an indispensable asset for business. The recommendation to partner with businesses with check-in based loyalty programs so users can use points to purchase items is not a new one. I believe the founders push it off as a “that’s not what we are”, knowing that they are currently the target market. For Foursquare’s longterm success, I believe the target market needs to change to the later adopters. Not sure they’re going to do that since they’re already wealthy from their sale of Dodgeball to Google years ago. If they don’t, they need to prepare for having a smaller user base and making less money. Not sure what they’re going to do and it’s an amazing problem to resolve.

Foursquare’s issue