It’s not surprising that ‘location based’ has inspired hundreds of apps over the past decade. Ever since smartphones begun to take shape, the competition in this field has been immense. It’s easy to see the appeal in developing these kinds of apps. The concept is straight forward, and there is no definite winner as of yet. There are, however, countless contenders- from Gowalla to Loopt to Google Places.

There is one service that sticks out. Foursquare, the check-in app launched in 2009, has been getting a lot of media attention. With 45 million users, they are definitely a big player.

Three reasons Foursquare became so successful

Foursquare

Both Dennis Crowley and Naveen Selvadurai had worked on location based services before. One of them was Dodgeball, a location-based application that used SMS. It started out as Crowley’s thesis project in grad school, and was acquired by Google in 2009. He continued to work there until leaving to co-found Foursquare.

The two soon-to-be founders bounced ideas around Crowley’s kitchen table. How do you discover new places? How do you remember where to go? How do you bring game mechanics into the real world? After comparing notes and discussing the possibilities for over a year, the two finally joined forces to work on a new app- Foursquare.

The first prototype was released quickly, available for testing in June 2008. After experimenting with it, the founders decided to set a deadline: South by Southwest (SXSW), the Texas based festival for creative works. At this point it was still just the two of them, but they managed to get the application ready in time.

The presentation was a success. People loved the game elements, and quickly became addicted to trying to oust each other as the mayors (person who checks in the most at a certain place) of establishments. That month, they saw over 40000+ new users.

While their initial release was successful, the amount of signups dwindled during the following months. Fortunately, growth picked up again as they begun adding new cities. But what was so interesting about this app? Let’s take a look at what contributed to the huge amount of signups early on.

The game-like features

One big way the app set itself apart from its competition is the game mechanics. The check-in feature quickly became a competition, as people tried to become the ‘mayor’ of certain establishments they visit regularly. Similarly, the badge system added to the addictive nature. There are many achievements one can unlock- from ‘Bender’ (checking in four nights in a row) to ‘Pizzaiolo’ (ordering slices of pizza from 20 different places). It’s tempting to go out and try to get some of these.

Interestingly enough, Foursquare has recently moved these features to Swarm, a separate app. This change is supposed to help in monetizing Foursquare without ruining the experience for users, as well allowing Foursquare take a more serious role as a search application. They discuss the change on their blog:

“In the near future, the Foursquare app is also going to go through a metamorphosis. Local search today is like the digital version of browsing through the Yellow Pages (remember those?). We believe local search should be personalized to your tastes and informed by the people you trust. The opinions of actual experts should matter, not just strangers.

An app should be able answer questions like ‘give me a great date dinner spot’ and not just ‘tell me the nearest gas station.’ We’re right now putting the final touches on this new, discovery-focused version of Foursquare. “

Allowing merchants to interact with customers

Another feature that allowed Foursquare to grow is how it works with merchants. Instead of only focusing on consumers, Foursquare allows establishments to reward customers, promote their business and have meaningful conversations with regulars.

Because of these abilities, the owners of establishments are willing to broadcast the existence of the app to their customers.

Expanding city by city

As mentioned earlier, growth picked up as Foursquare added new cities. This was a gradual process- every time a new city was added, the amount of users shot up. This city by city strategy, similar to the one used by Groupon, was smart.

Every time they would expand to a new city, they’d get both local and online media coverage. And, as with Groupon, having a decent amount of users in a small area made the user experience better than having a larger amount of spread out users.

This new, feature filled approach the the old concept of location based apps worked. Two years after their launch at SXSW, the app was averaging 3 million check-ins per day. Even Barack Obama signed up, intending to use the app to broadcast tips from places he has visited.

The check-in feature, and the point system based on it, was one of the main reasons people were attracted early on. If you’re marketing an app, have you considered doing something similar?