Foursquare Gamification Lessons Learned

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Foursquare Gamification Lessons Learned

Foursquare was launched as a location-based social networking app aimed at allowing users to check into various venues. The company gained a large user base as its popularity spread in the early years. However, Foursquare’s need to secure its long-term sustainability prompted it to rebrand. The rebranding eliminated the gaming elements that were the core of its business model leading to loss of users. With few users, restaurants engagement too waned. Even after reinstating the gaming elements in Swarm, user engagement remains low comparatively.

Foursquare's Declining Restaurant Engagement

  • Foursquare was launched as a location-based mobile social networking app that allowed users to check-in at different venues in 2009. The business concept hinged on turning life into a game or gamification.
  • Initially, the service was only available in certain metro areas before opening to other areas in the United States. Foursquare’s user base rapidly grew after the launch, reaching 10 million users in 2011.
  • However, a strategic direction shift that occurred in 2013 changed the company’s emphasis as a location-based mobile social networking app spurred by game dynamics. The decision to change was a response to constant questions regarding the long-term sustainability of its business based on gamification.
  • A slowing user growth was also a reason for the strategic shift. After reaching its peak in 2013, searches for Foursquare started to decrease significantly, tapering off to less than a third of the volume by 2014. The decline was caused by lack of poor design or lack of innovation and explosion of the social media.
  • Thus, to counter the decline, Foursquare started rethinking its corporate strategy. The company built various merchant services and platforms to cater for business. Foursquare also entered into strategic partnerships with other companies.
  • The company also redesigned and unbundled its services by offering two apps: Foursquare and Swarm. Foursquare was redesigned as a dedicated search and recommendation service referred to as Foursquare City Guide. Swarm retained the social networking aspects.
  • However, despite the numerous shifts and changes aimed at securing the company’s future, the dilution of the original company’s gaming concepts led to a decline in users’ participation. The idea of checking into places became less relevant to people because of apps such as Twitter, Instagram, and Snapchat.
  • According to Crowley in McCracken, users felt that there were sexier things to do. The redesign that changed the original concept of Foursquare led to a decline in user popularity. Thus, many restaurants started looking elsewhere to promote their brands.
  • A fundamental issue that has undermined restaurants’ participation in Foursquare's promotion program is downgrading the check-in to a sub-product. The company’s rebranding as a location analytics and ad platform has also affected restaurants’ participation.
  • With Foursquare losing the huge following after rebranding, restaurants are going for other options that resonate with their interests. The company now has a small but active user base as shown by Verto.
  • Foursquare's Declining User Engagement

  • After Foursquare was launched by Crowley and Naveen Selvadurai in 2009, the startup experienced a 3400% growth in 2010. By 2013, the company had attracted over 40 million users.
  • The users checked in over 4.5 billion times in 2013 up from 1 billion in 2011. By 2018, the number of people using it apps had surpassed 50 million per month with 12 billion total check-ins.
  • Foursquare was particularly appealing to users at its launch because it emphasized on the various gameplay elements. The elements allowed uses to collect badges after checking into venues, compete with friends over check-in leader boards, and compete to be ‘mayor’ of venues.
  • The success enjoyed by Foursquare attracted other entrants such as Yelp who introduced their own royalty system.
  • Foursquare started partnering with businesses, including restaurants to run promotions for checking into locations. Users who visited a given location many times could become a mayor of the destination, a credential that would be displayed on their status for everyone with the app to see.
  • However, after the release of Swarm, gamification was removed from the Foursquare service. The new app eliminated mayorships, check-ins, and badges and focused on discovery.
  • Many users were unhappy and launched many complaints on the company’s Facebook page. Eventually, the move led to less activity and less exposure for businesses, including restaurants.
  • Pressure from Foursquare’s highly engaged end-user social groups or super-users led to a reinstatement of some gaming elements such as global mayorship within Swarm. A revamp of the app accommodated ‘lifelogging’ and recording of a person’s daily locational traces.
  • Today, Swarm engagement is still low compared to its past engagement statistics as a check-in service app as shown by the available statistics. According to Verto Watch, Swarm had 2.0 million users in August 2018 which is a pale look compared to the 2013 statistics.

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