Foursquare vs. Gowalla vs. MyTown: Which Is Better for Business?

social media toolsYou know the location wars are heating up when a simple search for “Foursquare vs. Gowalla” returns millions of results. And then there’s MyTown.  Which of these is right for your helping your local business?

The two hottest location-based social networks—Foursquare and Gowalla—are taking different approaches to the market, and seeing unique uptake patterns as a result.  While these companies have repeatedly said they don’t view each other as competitors, the activities on networks are similar.

What’s more, several other companies are making the case to be included in the discussion about the top location-based network, including Booyah’s MyTown, which has more users than Foursquare and Gowalla combined.

Let’s take a look at how the location wars are unfolding and which of these services might be ideal for your marketing strategy.

The Contenders

Foursquare

foursquareFoursquare, founded in 2009, has attracted more than 1 million users.  Users have the ability to “check in” at local businesses, bars, and restaurants, are able to find friends at different locations and have the ability to become “mayor” of a given location, which often entitles them to benefits and discounts.  Users also receive “badges” for completing certain tasks and doing activities a certain number of times.

Foursquare offers an excellent city guide in cities where it is well-established, and has a fun aura of competition arising from users attempting to check in at favorite spots more than others.  Until recently, the network was limited to large metropolitan areas, so it was not as robust in smaller areas as other services.  Because the site does not use GPS for its check-ins, like Gowalla does, it can be gamed as a result.

Gowalla

gowallaGowalla is seen by many as the main location-based social competitor to Foursquare, but despite being founded in 2007, it has only attracted a quarter as many users (250,000) as Foursquare.

Gowalla also allows users to check in at local establishments, but is more framed around an idea of “social gaming.” The network allows users to discover, capture, and share places and events with friends through a slick user interface that is one of its key differentiators.

Gowalla has also been available throughout the U.S. for some time now, and has established communities in some areas where Foursquare has failed to gain traction. However, Gowalla’s small install base does make it harder to find the connections that make social network entertaining and useful for businesses.  It also had limited handset availability at first, and only recently rolled out an Android version (Blackberry version in beta), which has further slowed its adoption.

MyTown

mytownMyTown was founded by Booyah in 2007, and has rapidly become one of the most popular iPhone applications ever.  It has about 2 million users, making it more highly trafficked than either Foursquare or Gowalla.

MyTown allows users to “buy” and “own” their favorite stores and hangouts using virtual currency. This ownership model allows users to collect “rent” from others when they check in at shops they “own,” increasing the fun competitive nature of the application.

The large user base holds exciting opportunities for marketers in general.  The problem is that large install base is restricted to the iPhone, which limits further adoption potential.  The lack of handset choice plus the gaming aspect of the service makes it less attractive as a social network, though the gaming offers more potential services and features than other platforms.

The Battles

Commercial Potential

Foursquare is in the lead when it comes to catering to small- and medium-sized businesses.  The company has built its feature set to be useful and valuable to small business owners, because its platform incentivizes users to visit local establishments more frequently with its “mayor” system. The company also has created a “Foursquare for Business” dashboard that will provide additional info on user activity. The company has also landed many commercial partnerships, including with Starbucks and Bravo, which indicates an evolving business strategy that eventually should include much smaller businesses.

Gowalla is geared more toward interaction among users, and it has yet to deliver a clear commercial strategy.

MyTown uses contests to generate revenue, but the platform is again designed more as a multiplayer game than a transactional platform.

Functionality

Foursquare has pulled in front in the feature department, and it has received the most media attention because its core functionality is the most robust and easy to use.  Gowalla’s initial launch had many bugs and a choppy user experience, but its second try was much improved.  MyTown is the simplest and its features tend more toward gameplay than user interaction.

Fun

Though it may not be as useful yet for businesses or have as many features, MyTown is currently more fun for its users. What makes MyTown weak on the other counts makes it win this battle.  The comparisons here are a little skewed, because Foursquare and Gowalla are more social networks than social games like MyTown, but MyTown’s superior signup numbers show just how entertaining users are finding the service.

Look and Feel

Gowalla is winning currently in the design battle, however. The company’s CEO is a former designer, and the slick, attractive user interface displays a close focus on look and feel.  Foursquare and MyTown are both more functional than eye-catching, and their value is more in the interactions that take place than the visual aspects or display features.

Conclusion

Though all of these platforms offer great potential opportunity for businesses, only Foursquare is large enough and commercial enough currently for businesses to consider using it as part of their digital strategy.  Though they are emerging and growing rapidly, Gowalla’s scale and MyTown’s lack of a clear business focus keep them from being must-use applications like Facebook and Twitter.

Location is one of the hottest spaces around right now, however, so don’t be surprised if all of these players eventually command a large enough audience to have a significant business impact.  The early location battles are over and Foursquare is the leader; however, the larger war for location dominance is far from finished.

Have you “checked in” to these platforms? Which one are you a fan of?  If you’ve leveraged location-based platforms for your business, how are they working? Let us know your thoughts and ideas in the box below.

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About the Author, Peter Wylie

Peter Wylie is lead researcher for Three Ships Media, an emerging media marketing company that specializes in using blogs and social networks to connect clients with target customers online. Other posts by »




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  • Hackett Polly

    I think you forgot about SCVNGR

  • http://www.theincslingers.com/blog Simon Salt

    Nice post, a couple of points though. Gowalla was not founded in 2007 – that was Alamofire which was the design company from which Gowalla was born. Gowalla appeared in 2009. The earlier game from Alamofire was Packrat which was a Facebook game. Gowalla has done some excellent business partnerships so definitely shouldn’t be excluded from anyone company Social Location Marketing strategy.
    Before deciding which platform to choose an organization needs to figure out the why, that will certainly help them choose the where. Foursquare is more attractive to competitive users (usually men) Gowalla is more of an experiential service so more attractive to collaborators (usually women).

  • http://www.freemarketingmadeeasy.com Trent

    Hey Peter,

    I really enjoy the content here. I think that location based services are on the up and up when it comes to connecting users to select businesses. How do you anticipate that small businesses will break into this type of campaign? I feel that its perfect for a small biz to give out discounts or incentives when the service revolves around a local community or your own hometown.

    Cool insight!

    -Trent

  • http://www.socialmediaexaminer.com/ Michael A. Stelzner

    Hi Polly,

    It looks like that app is all about scavenger hunts at places. I had not heard about it.

  • Peter

    Simon,

    Thanks for the clarifications and sorry I missed that in the original post. I agree, Gowalla has landed some solid biz parternships as well, as evidenced by their inclusion in the New Jersey Net’s relocation campaign, for instance.

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Trent,

    I think that audiences have to begin using these services in a critical mass before its worth a small businesses time to pursue these opportunities. If your small business is in a Top 10 metro environment however, and you cater directly to consumers, I think Foursquare can already have utility. Check out their business page to see how other small businesses are using the application to drive sales.

    Thanks for commenting,

    Peter

  • http://daviddoolin.com/ Dave Doolin

    Peter, excellent summary. Too few of these kinds of summaries are as good as yours.

    I agree with your comment about Top 10 metro, these services don’t seem much use to me in rural areas (having lived in rural areas, not just a whole lot to do.

  • http://twitter.com/janthonymez J. Anthony Miguez

    I think there are some other points of differentiation that are worth noting such as “product” (4sq) v. “platform” (Gowalla) as they drive longer term viability and user engagement. i wrote about these in more depth a few weeks ago after 4sq got its big check. http://janthonymez.wordpress.com/2010/06/30/cash-the-check-in-fast/

  • Margie Arnett

    I think Foursquare is more ‘fun’ than My Town. Earning badges reminds me of earning scouting badges.

  • MrWhirly

    I signed up for both Foursquare and Gowalla and have used them hard to judge which was better for the user and for potential clients. I agree with your findings that Foursquare has better usability and Gowalla looks nicer but neither of them seems ready to become a go to app for businesses to use as marketing tools and customers to use as savings vehicles.

    The impending launch of Shopkick may be the game changer that location based social networking needs to shake these early adopters out of their doldrums.

  • http://sayWOWmarketing.com/ Vickie Siculiano

    Foursquare rocks just became a mgr for a restaurant and created a rotating special- now we add value as the only one in Montclair NJ! Rock on foursquare!Vickiehttp://saywowmarketing.comBtw it’s Mesob Ethiopian Restaurant :)

  • http://marketingmixsite.com Brent Pohlman

    We have a Four Square cling at our front door. For professional business services it may take awhile for people to find us, but I am going to give it some time. Check us out, Midwest Laboratories – Omaha, NE
    Check out their website foursqure.com/businesses and twitter tag #4sqcling Sign-up and receive your own cling mailed to your company.

    Brent Pohman
    Marketing Director

  • DonnaGilliland

    This is a great article. The comparison between applications is very good.

    Location-based gaming is a great marketing tool for business but I find that the consumers know more about it than the businesses do.

    I am currently working on a Foursquare marketing project in conjunction with my local chamber to educate businesses and consumers on location-based gaming, specifically Foursquare and how it can be used to benefit both business and consumer. I have dubbed the marketing project as “Make Our City a Foursquare City.”

    Again, thank you for a great article!

    ~ Donna Gilliland

  • http://www.sigmabizlearning.com/ Jamie Gorman

    I confess that the primary driver for me to move up to a Droid from my regular cell phone was Foursquare! There I said it. I tell my small business clients that the driver is referrals – every time I check in 200 people who know me receive a post that I like that place! I had four people comment to me in person about my frequenting of Cupcake Heaven in Haymarket, VA. All were ladies who are potential CH customers and never heard of it before I mentioned.

    Any idea when/if Foursquare is planning to support multiple promotions at one time? Thanks for the post.

  • http://www.instantdane.tv/ Dane Findley

    As best I can tell, Foursquare doesn’t even allow you to add a url to your profile page. The ability to customize a profile page on a social media channel is — for me — a basic criteria for how truly interactive and useful it is. I’m continually surprised that more people don’t notice and talk about this.

  • http://www.kombicorp.com @Mob_elle

    Really good evaluation, Michael and Peter. I’m glad to see you describing them as “LBSM” platforms versus just location-based services. The thing that’s compelling about these to the consumer IS the “social” aspect, whether for badge competition or other entertainment value.

    There’s another LBS approach to this “choose me” model–the “I choose [to talk to] you” model. Implies the biz already knows the consumer (via profile) as loyal, and com’cates to them based on location and proximity (physical or logical) to a desired state.

    This is an important distinction and would welcome input from your readers. I think it has big commercial viability; it’s where it’s all going in my opinion. Kombi Corp has adopted this model. Check us out at Kombicorp.com and please chime in with your ideas, ok?

  • http://www.becomingyourownbank.com Nick D.

    Foursquare is King!! I must agree that the most potential lies in foursquare at the moment!

  • http://twitter.com/AdamRyding Adam Ryding

    I have also been trying out Yelp and Where on Android. Overall, I believe that Yelp has a lot of potential to be a large competitor. It terms of business, Yelp is more likely to provide more benefits to the producer than any other LBS on the market. However, it all comes down to user-base, and Foursquare is leading the pack.

  • Nick Bowditch

    Gday Peter,

    Great post, thanks I will refer back to this a lot with my small biz clients. There is a fair bit of interest here in Australia now for FourSquare although the others have very little traction. Actually, FourSquare still only really has a very cliquey kinda existence in Australia but the rewards for a small business – particularly if they are a cafe or similar business that has a retail shopfront and products/menus they can discount for users – seem really obvious to me so I am telling my clients about it all the time.

    Thanks again for the good post.
    Nick

  • http://www.facebook.com/rose.roll Rose Roll

    Michael – SCVNGR is actually a way for people to not only check-in at places (like Foursquare), but also to engage with the location in some way to score points and eventually badges – whether that’s by taking a picture of yourself doing something quirky, or answering a trivia question that can only be answered if the person is in the actual location. Some businesses reward high-scoring people with discounts or special offers.

    They’ve signed up 400+ businesses, including a number of museums and universities, and our nonprofit organization is thinking about doing a trial run – I’d be curious to see what you think about it.

  • http://www.jasonbereklewis.com Jason Berek-Lewis

    Hi Peter, thanks for the interesting post!

    I use both Foursquare and Gowalla. I prefer Gowalla’s gaming aspects, look and UI – lightyears ahead of Foursquare. But, here in Australia it really is a game of numbers and Foursquare is winning the race.

    As an interesting aside, I had significant trouble connecting my Foursquare and Twitter accounts. I @ replied Foursquare on Twitter for months seeking their help and never heard back from them – not very social for a social media/ social gaming brand. I eventually solved the issue by visiting an unofficial forum.

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Dave,

    I think that with scale, these networks will increase in relevance in rural areas,

    Thanks for the comment,

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Anthony,

    Very interesting points, and thanks for sharing your post. I’ll be sure to check it out.

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Peter,

    I’m not familiar with Shopkick, but I’ll be sure to check it out. I think that with time and investment, Gowalla and Foursquare will achieve the critical mass necessary to be really useful marketing tools. I think that date is probably 12-18 months out, given the growth trajectories of other successful social networks. Thanks for commenting,

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Brent,

    Glad to see you’re experimenting with using Foursquare in a more B2B setting. Please let us know what results you see and any best practices you learn. Thanks for commenting,

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Donna,

    That sounds like an interesting project! I think businesses will see the value in these networks once they’ve achieved greater scale, but the trick is for them to know their way around them at that point. Too many businesses had to play catch up when their customers were already on Facebook and Twitter, and the same will happen if these services begin to grow at a rapid pace.

    Thanks for your comment,

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    SigmaBiz,

    I do not know the time frame on the multiple promotion rollout, but I have to think it will eventually as it becomes more and more business friendly. I think Foursquare’s focus on driving business results came earlier than either Twitter or Facebook, and it will be interesting if that decision hurts growth or spurs it,

    Thanks for commenting,

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Mob_elle,
    These are very interesting thoughts about the nature of social networks and what drives the distinction. I’ll be sure to check out Kombicorp and learn more about your take on the question. I think your LBS – LBSM point is spot on. Thanks for commenting,

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Adam,

    You’ve got a great point about Yelp’s ability to grow in this space, and it could be an interesting strategic buyer of either of these services at some point. Millions already rely on Yelp’s recommendations for bars and restaurants, and that’s squarely where Foursquare is aimed.

    It will be interesting to see how this space evolves for sure,

    Peter

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Jason,
    Huh, sorry to hear that. You’re right about a game of numbers, and I didn’t even touch on the international status in the point, so thanks very much for adding that perspective. Thanks for commenting,

    Peter

  • http://chuckreynolds.us/ Chuck Reynolds

    For the simple fact of hating on MyTown…. :O

    What/Whoever they use for data (I’m assuming citysearch) SUCKS… SUCKS so bad… The data is very old, you don’t have to be anywhere remotely near the venue to check in (yes they recently sort of updated that but still), the rent is some weird not-related-to-anything-IRL algorithm that randomly gains visitors/renters… It’s annoying as you don’t know what venues to buy. Every single time you check in you earn ‘modifiers’ lets call them, which allows one to quickly level up. There’s real no social aspect to it. I could NEVER get the email to send to join the rest of the game, no matter what email address I put in, just never sent/showed up.

    I’d love to see the demographic of MyTown – I’m sure it’s very young as I don’t see any real world reason to use this app as opposed to Foursquare / Yelp / Gowalla etc.

    Anyways… my 2c

  • http://www.jasonbereklewis.com Jason Berek-Lewis

    Another funny aside to the international aspect: Gowalla use a kangaroo as their logo/ mascot, yet are seriously behind Foursquare in the land of the kangaroo: Australia, Down Under!

  • DonnaGilliland

    Peter,

    Thank you for your feedback. I agree with you on the “greater scale.”

    We have a very popular and large BBQ restuarant in my community and one of the local ministers went in to eat. The marketing person for the restaurant went over to say “hi” and in the conversation he told her “I am the Mayor of this restaurant.” Unfortunately for the customer she was not familiar with Foursquare. The point the story is that consumers are checking in and there are no reward systems in place. On the opposite side of the coin businesses have a Foursquare rewards system in place but consumers do not know what Foursquare is.

    I think the community marketing project I am working on will be fun and benefit both business and consumer – at least that is the plan.

    Donna

  • http://www.facebook.com/profile.php?id=2704322 Peter Wylie

    Chuck,

    No question where you stand! Thanks for the opinions, very interesting.

    Peter

  • http://www.wsionlinebiz.co.uk Anthony Burke

    Here in the UK, I use Foursquare but for us country bums, they are only really useful and interesting when we visit a big town, eg London..then they are great…not so for rural areas where so few businesses are registered or know about. Anyway the good thing about social media platforms, is that they are fun to use!

  • http://www.theorangecow.com/ Lexjt

    Thanks for the post Peter. I’m looking to develop a foursquare/gowalla campaign for the 2011 Exeter Food Festival in the UK (http://twitter.com/exeterfoodfest / http://www.exeterfoodanddrinkfestival.co.uk) which lends itself to these two platforms for obvious reasons so your post and all the resulting comments are great for insights. From looking at http://www.checkinmania.com there are quite a few exeter businesses and users on foursquare / gowalla/ brightkite which is encouraging! So…by Aprill 2011, what with android growing and smart phones becoming the norm I think there will be plenty of potential for smaller businesses and events like the food festival to join the big brands taking advantage of the great opps from these platforms!Unless a game changer comes in and rocks the boat that is!!thankslexhttp://twitter.com/lexjt

  • Bill Lord

    Great post Peter,

    I have been using Foursquare for a while and was curious about what the others offered for commercial use. It sounds like they don’t offer much… Here in Portsmouth, NH we participated in “Foursquare Day” http://4sqday.com/ which ended up being a huge success for local businesses, and helped get local companies to recognize Foursquare on a regular basis offering discounts etc to their “Mayor” or if you “Check In” at their location. Here is a blog post I wrote about the event – http://www.vtldesign.com/vital-blog/all-things-vital/foursquare-day-in-portsmouth-nh/

    Thanks again for explaining Gowalla and MyTown, very helpful!
    Bill

  • http://www.HappinessEvangelist.com/ Daniel Doherty

    I also like a http://www.rummble.com which is a UK based start up that has been around a while and works slightly differently using a clever trust algorithm (invented by a real rocket scientist) to give personal recommendations of stuff you will like based on your network of friends experiences.

    It has worked world wide for a very long time, please check it out : )

    http://en.wikipedia.org/wiki/Trust_metric is what makes it more relevant to the user!!

    Must admit I’m biased as the founder @andrewjscott is a friend but that doesn’t stop him being a very smart cookie and worth following his adventure!

  • http://www.HappinessEvangelist.com/ Daniel Doherty

    Hi Donna,

    I’d be really interested in reading anything you are prepared to share about your work, I love my local area and keep thinking what else could i do to promote it & make my info useful discoverable to others : )

    I am slowly working on something too.

    Thanks,

    Daniel
    @PutneyProperty
    http://www.HappinessEvangelist.com : )

  • Mbcrimmins

    Help! I’m a small business owner who is not part of the millenial generation so all of this is overwhelming. I think I get the basic concept of FourSquare, etc. but what can it do for my business? Where can I learn more? I am absolutely ignorant. Thanks!

  • http://www.socialmediaexaminer.com/ Michael A. Stelzner
  • http://www.codyaswann.com/ Cody Swann

    So, you’re staying Foursquare is the way to go. And it doesn’t even seem to be close

  • David

    Hi Peter,

    I’d love to talk to you more about MyTown and the unique opportunities we afford our many partners. Let me know if you’ve got time to chat.

    -David
    Associate, Corporate Communications
    Booyah
    @booyahdavid

  • http://www.sigmabizlearning.com/ Jamie Gorman

    At the risk of shameless self promotion, I put this blog entry together last week. The article Michael linked to is a great discussion of the trend to local based apps. I looked at the referral aspect of Foursquare. Word of mouth might get you a few dozen referrals – word of Foursquare gets you a few hundred. Enjoy. http://bit.ly/SBFoursquare

  • http://www.brosix.com/ Brosix

    I agree- I think Gowalla is the best design-wise, but FourSquare certainly has the most consumer power as of now.

  • http://twitter.com/MorganGrahamEFM Morgan Graham

    We recently completed a presentation on the very topic you are concerned about! Here is a powerpoint and whitepaper to get you started: http://efmexperience.com/html/blog/a-location-based-brew-of-social-media/

  • http://twitter.com/MorganGrahamEFM Morgan Graham

    But Yelp doesn’t need to become a strategic buyer of either! Their check-in functionality is already picking up speed with Yelp mobile users. Plus with their recent additions of badges and royalty statuses, the line between Yelp and the other location based social media apps is become vague. Though I <3 both Foursquare and Gowalla, unfortunately, I think it's only a matter of time before Yelp takes over. The check-in functionality paired with the massive amount of valuable reviews Yelp has, it would take years for them to compare. That it is, only IF the current millions of users of Yelp's mobile app adds the "check-in" behavior to their "review-it" behavior.

  • http://twtrcoach.com TwtrCoach

    I enjoy both Foursquare and Gowalla. Both is great location based services. Still not 100% accuracy, but that will come. And there is so many great functionality options that I am sure they will add in the future. This only the beginning.

    Was not aware of MyTown. Have to check that out.

    Cheers.. Are

  • http://www.ann-sense.com/ Ann Marie van den Hurk, APR

    All are good for business. For both businesses and users, it comes down to ease of use, personal preference, and who within one’s social group is using it.

    It is important how businesses and users chose to use it. Only recently, am I seeing businesses giving rewards to users for check-in. There still is a gap between the two groups. As location-based social networks move mainstream, I believe the gap will be filled with small businesses leading the way by listening to their customers.

    I use Foursquare personally, but Gowalla, MyTown, BrightKite, and PlacePop are all good location-based social networks.

  • http://thesocialmarketeers.com Christine

    Donna,

    Like Daniel, I’d be very interested in any information you are willing to share on that community marketing project.

    I am putting together a similar plan for our town and would really appreciate being able to brainstorm.

    Christine
    croux at thesocialmarketeers dot com

  • http://www.cygnismedia.com/mobile-phone-application/new-iphone-applications.html iPhone Apps

    Your article is very informative and the use of graphics adds to understanding the process. I think some of your sentences are too long, and a few minor commas are missing. One thing I was taught, never end a sentence with a preposition.

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