Bloomberg News

Foursquare Goes Back to Basics in Search for Users, Ads

August 06, 2014

Foursquare CEO Dennis Crowley

The simplified update of the Foursquare Labs Inc. app focuses on letting people find restaurants and businesses around them using their mobile device, Chief Executive Officer Dennis Crowley said in an interview. Photographer: David Paul Morris/Bloomberg

Foursquare Labs Inc., which built a business from a social check-in network, goes live today with a revamp of its flagship application that puts location search front and center in an effort to attract users and advertisers.

The simplified update of the app focuses on letting people find restaurants and businesses around them using their mobile device, Chief Executive Officer Dennis Crowley said in an interview. The tool lets users narrow down preferences -- for example, to cafes selling milkshakes or hummus -- and notifies them when near a store they may be interested in.

By elevating the once-hidden search tool, Foursquare is trying to draw in new users and offer businesses a better place to display ads. In May, the company moved the check-in feature, which has faded in popularity since it was introduced five years ago, to a new app called Swarm. Today, the feature is no longer the centerpiece of the Foursquare app.

“We were so good at the check-in, people have forgotten we are really twice as good at local search,” Crowley said in an interview. “Once you hit the mainstream, you really have to simplify these products. They have to be really good, really fast, really simple and really light.”

When introduced in 2009, Foursquare was effectively a social-networking game, encouraging people to check in to restaurants and compete to earn “mayor” status. Now, Crowley says he’s stripping it down to an original goal of helping users find businesses around them.

Taste Preferences

In addition to being a search tool function, the Foursquare app will prompt people to upload their food and shopping preferences, so those details can be used with their phone’s location data to suggest nearby places to visit.

The New York-based company’s engineering team worked to ensure this always-on function drained less than 1 percent of a phone’s battery an hour, Crowley said.

The app will also encourage people to leave tips -- like where to shop or what dish to order -- in the new app by giving prolific recommendation-givers the badge of “expert.”

For Crowley and his team, as well as his backers, who include Barry Schuler’s investment vehicle DFJ Growth and venture capital firm Union Square Ventures, the bolder move into local business search will be a challenging one. To get a piece of the market for digital advertising, where spending may reach $140 billion this year, Foursquare will need to persuade smartphone users to turn to its app rather than the search tools of incumbents like Yelp Inc. (YELP:US) or Google Inc. (GOOG:US)

“Advertisers are really excited about a lot of the changes that we’re making because they understand we’re doing this to appeal to a larger user base,” Crowley said.

To contact the reporter on this story: Alex Barinka in New York at abarinka2@bloomberg.net

To contact the editors responsible for this story: Sarah Rabil at srabil@bloomberg.net Ben Livesey, Stephen West


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