Smart phone users have become comfortable with using programs such as iWant and Yelp to find nearby restaurants, gas stations and almost everything else. Now, savvy small businesses are using geolocation technology to market directly to potential and existing customers. Geolocation services represent an inexpensive valuable marketing tool, especially for small businesses that rely on customer traffic – businesses like restaurants and retailers and services like spas and hair salons. Twitter, Yelp, Facebook and Google are beginning to get in on the act, and established independents such as Foursquare, Where, Gowalla, Scvngr and Whrrl,are serving a growing number of smart phone users. Foursquare alone claims 3 million users and more than 1 million check-ins a day.

There are some minor variations among providers, but this is how most work:

• Geolocation services capitalize on the ability of today’s communication networks to pinpoint the location of smart phones and other mobile devices.
• Smart phone users “check in” via a smart phone application or by text message to share their location with friends. Users can connect their accounts to their Facebook and Twitter accounts, which produce an update when the user checks in to the service. Users earn points or receive other incentives for checking out new businesses or revisiting old favorites. In addition to these incentives, some services offer smart phone users access to business directories and guidebooks. Currently, the services for individuals and businesses are free, though there is much speculation about how the industry intends to make money from its traffic.
• Business owners can reward customers who visit their businesses and “check in” with the geolocation service. Businesses might offer discounts, incentives or loyalty programs to customers who have “checked in.” Most geolocation services provide businesses with free access to customer demographic information about those consumers who check in. This allows businesses not only to get to know their customers better, but also to connect with them in real time to spur sales. For example, if business owners detect a pattern in customer visits, they might offer special incentives to spur traffic on slow days.

Getting Started
If you think that geolocation services like these might be a valuable addition to your marketing efforts, it’s easy to get started. First, determine what your major goals are. Do you want to reach existing customers? Attract new ones? Do you want to obtain better demographic data on your client base or develop a rewards program? Do you want to launch (or enhance) your online social network? Once you know what is important to your business, determine which service best matches your needs.

It is also a good idea to check if your business might be listed on some of these sites. Check out some of the more established sites such as Foursquare and Yelpto see if customers are already checking you out via their smart phones. Registering with the sites (whether you are already listed or not) is simple. Once registered, you will be able to manage your own listing, make customer offers and view any available data on customer users. Some will also allow you to link up with your Twitter feeds or Facebook accounts if social media is already part of your marketing efforts.

Geolocation service providers offer small businesses another way to connect with valued customers and customize incentives to reach new ones. For businesses that rely on customer traffic, they offer a whole new way to market directly to their clientele in a cost-effective and efficient manner.