Foursquare is dealing with a landslide of queries from business owners and marketing agencies that want a piece of the fast-growing service. Their requests are diverse: to validate a listing, create a special (i.e. promotion), score a custom badge, do coffee. The result has been long waits, in some cases three months or more, for businesses large and small.
"It's not that we don't think your ideas are good, it's just that we don't have time to answer all of them," founder Dennis Crowley told a roomful of marketers at the CM Summit last week during Internet Week in New York.
The number of queries to Foursquare now numbers in the hundreds each day. But the New York start-up is doing a few things to attack the backlog and streamline its processes, so relief may be in sight. It has also developed what it believes is a scalable approach to working with large brand advertisers.
To address the backlog, Foursquare has just hired several staffers whose job is to plow through the long queues of business requests. They're each currently processing hundreds of such requests a day, according to a spokesperson. On the list are a huge number of mobile businesses that want to verify their listings - a process by which Foursquare confirms a person owns (or represents the owner of) a food cart, cafe, corporate office, or any other business. Verification is a prerequisite for offering specials - like, for instance, a free Italian sausage with onions and peppers on your fourth check-in.
To cope long-term, the company is building a system that will automate the process for setting up a special. For now it's a high-touch endeavor. For example, Foursquare does not approve specials without a clear reward for users or ones that have an expiration date, since removing the promotion later requires an extra step. Each special must be checked manually. Presumably, the new system will fix that.
Scalable Model for Brands
The good news for large advertisers is that Foursquare is perfecting what it describes as a scalable approach to working with brands.
It has already developed integrations with a range of brand advertisers in various verticals, including Starbucks for retail, Bravo in entertainment, Pepsi in packaged goods, and Bing for technology and online services. It has more on the way, according to head of business development Tristan Walker.
"We have a good number of brands in the pipeline, particularly in retail," Walker told ClickZ in an e-mail interview. "We're working with brands/retailers to think about how we can help engender loyalty. We're hoping to really innovate in this space in the next few months. We'll continue rolling out brand integrations in a variety of ways, working closely with brands to ensure that both we and they feel comfortable with the campaigns."
For Bing, Foursquare created a Bing-themed World Cup badge users can unlock by following the search brand on the service. (The badge followed the release earlier in the week of two badges depicting the CNN logo hovering over a soccer ball.)
However, the custom badge option will remain an exclusive (read: expensive) endeavor for most companies, and the company is now pushing smaller companies toward running specials instead.
Walker told ClickZ, "We are taking our time to determine what the platform for badges should look like in the future. We're continuing to discuss the best way to handle branded badges with the fantastic advertisers we've been working with thus far." (Read the full interview with Tristan Walker: "Questions for Foursquare's Head of Business Development")
While some marketers have vented frustration at the company for having been unprepared for the surge in advertiser interest, most are quite understanding about it.
Becky Minervino, interactive strategist at Durham, N.C.-based McKinney, said Foursquare met her expectations of what an early stage start-up could be expected to deliver.
"The biz dev person we have been working with said they were not able to accept customized badge requests for the next three months due to a back log of existing commitments," she said, adding it was "all part and parcel of their stage of development."
David Berkowitz, senior director of emerging media at 360i, sounded a similar note.
"Foursquare has all of 25 people, and they're in demand by just about every major brand remotely interested in exploring how to connect with their consumers via mobile and social channels," he said. "It's hardly surprising to see demand outstripping supply; this is often the case with much bigger companies in their space."
Ian Schafer, CEO of Deep Focus, suggested brands wanting to work with Foursquare skip the outreach and learn the APIs.
"You can do more with Foursquare without their involvement than you can with it," he said. "The only reason to work with them directly is to get a badge."
Schafer advises marketers to learn social platform APIs, and his agency is preparing to offer seminars on the subject.
"We're going to help to educate these guys, hopefully with Foursquare's blessing, to teach them to leverage the benefits of platforms including Foursquare without a media buy or a biz dev guy," he said.
Christopher Heine contributed reporting.
Follow Zachary Rodgers on Twitter at @zachrodgers.
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Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects.
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