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Maybe you’ve noticed a trend lately on Facebook or Twitter where certain people “check in” at wherever they may be at the time—perhaps the local Starbucks, their neighborhood bookstore or even the post office. At first glance you may have seen some of your friends and followers doing this and thought, “who cares where you are?” 😉

If you are a small business owner yourself, however, you might want to take a closer look at what’s going on.

In most cases, these location-based “shout-outs” are being done via an application called Foursquare. While there are other similar apps out there (such as Gowalla), Foursquare has emerged as the most buzzed-about geo-location tool, and the application you’re most likely to see pop up in your Facebook News Feed or Twitter stream.

What Is Foursquare?

As the official website explains, “Foursquare on your phone gives you and your friends new ways of exploring your city. Earn points and unlock badges for discovering new things.”

While you will often see it integrated with social networks like Facebook or Twitter, Foursquare is not used in the same way as these sites. Whereas you might sign into Facebook or pull up Twitter to see what your friends are talking about, people use Foursquare, primarily via mobile phone, to make a “game” out of letting others know where they are at any given time.

For example, say you’re out and about downtown.  You would take out your phone (be it an iPhone, a Droid or a BlackBerry), click on the Foursquare app, and via GPS, you would see a list of all the nearby locations. You would then click on the business where you happen to be and then “check-in,” adding a custom message and posting it to Facebook and/or Twitter if you’d like.

As you check in at new places, stop at multiple places or make repeat visits, you earn points and unlock “badges” in the game. Check in to one place regularly enough, and you get a chance to be named “mayor” of that location.

Sound silly? While on the surface Foursquare may seem easy to dismiss, many small businesses are already embracing it to engage with customers and build loyalty. Foursquare recently passed the milestone of 100 million check-ins, and it even made Entrepreneur Magazine’s annual List of 100 Brilliant Ideas.

How Local Businesses Are Using it

Geo-location is huge in social media, and will continue to boom in the coming years. In fact, at this year’s South by Southwest (SXSW) Interactive Conference it was announced that spending on global location-based services is on track to exceed $7 billion over the next three years.

Realizing this, savvy local businesses are taking advantage of Foursquare by using it to offer specials, discounts and rewards programs to pull in new customers.

To illustrate, here are just a few examples of current offerings by businesses near me:

* Sports Authority in Cherry Hill, NJ: Get a $10 Cash Card towards a purchase as a thank you for being Mayor

* Exit Skateboard Supply in Philadelphia, PA: Get a free T-shirt for your first check in on Foursquare

* Whole Foods Market in Marlton NJ: Free small coffee for the Mayor anytime; plus a free reusable bag on your 10th check-in

* Tortilla Press Cantina in Pennsauken, NJ: Free appetizer on your first visit; Mayor at end of month gets a $20 gift card

Another bonus for business owners using Foursquare? Access to venue analytics tools that will let you explore some pretty cool stats. For example: who the most frequent visitors are, the total number of unique visitors, what times of day people check in, who the most recent visitors are, and more.

What About Online Businesses?

While virtual businesses may not benefit the same as brick and mortar ones, online business owners can still use Foursquare to make connections—the same way they do via other social networking sites.

One example of a virtual biz owner using Foursquare successfully is a Facebook connection of mine, Rebecca Thompson of CLR Virtual Connection. Someone she “ousted” as mayor of a location ended up hiring her after becoming aware of what she did for a living in the process. In another instance, a Twitter follower engaged her after noticing that they often both checked into the same places. That conversation led to a request for Rebecca’s services.

It just goes to show—you never know where your next client or customer is going to come from. And while cutting-edge applications like Foursquare might not yet be as widely used as a social media behemoth like Facebook, with the exploding popularity of smartphones and location-based social networks, business owners would be wise to take a second look.

Resources

Join Foursquare
Find out more about Foursquare for business (and claim yours)
Foursquare support