Location-Based Mobile Social Networks and Games Experiencing Rapid User Growth
Monetisation builds on brand partnerships and and sale of in-game gifts.

Mobile social networks and games incorporating user location are experiencing an upswing along with the proliferation of smartphones with GPS. Examples of services with fast growing user-bases include Foursquare, Gowalla and MyTown that together now have close to 3 million users. What makes these services stand out from earlier attempts in the history of LBS are the ties to user’s real-world favourite locations and the combination of game mechanisms and social interaction that motivate users to explore places and meet people.

Foursquare enables users to connect with friends and update their location. The gaming element awards points and badges for checking in at venues and new places or meeting new people. Gowalla is another social networking service that uses game mechanics as a motivator for people to go to places and meet friends. With a GPS-enabled handset, users check in at places, share their location with friends and leave comments. The user gets a virtual passport in which visits to real-world locations are recorded when the user is within GPS radius. Whereas Forsquare rewards frequent check-ins with a mayorship of the location, frequent check-ins using Gowalla results in a higher ranking in the top-ten list. The MyTown game for the iPhone, released by Booyah in December 2009, brings together elements of the real world and the digital world. MyTown uses GPS to enable players to check-in at real-world locations to unlock rewards. Players can buy and upgrade shops, enjoying virtual ownership of their favourite real-life places.

These services are also exploring new revenue models. The apps are free of charge and monetisation builds on brand partnerships and sale of in-game virtual gifts. What makes them interesting for local business owners is the possibility to engage their customers by offering discounts and gifts to frequent visitors. However, it is difficult to predict whether these apps will receive true mainstream adoption or remain favourites for a set of early adopters.

André Malm

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