I was recently telling someone about Foursquare and how it worked, and the latter part of conversation (after I explained the basic mechanics of the app) went *roughly* as follows:

Friend: So you have to be IN the place to check in there?
Me: Well, you are supposed to be.
Friend: How does Foursquare know you are actually IN the place?
Me: It uses GPS to see where you are.
Friend: But can’t you just check into places nearby, even if you aren’t really in them?
Me:Yah, technically. Well, yes.
Friend: Well that seems kind of stupid.

And I had no response for that last line. She was right, that is kind of stupid.

Whenever I find myself explaining Foursquare to someone that doesn’t give a shit (there are bazillions of people like this by the way, lest us nerds forget), they initially think it’s completely stupid and don’t understand why on earth you would ever bother checking in someplace on your cellphone.

That is, until I explain that through Foursquare, businesses are able to reward their best customers (frequent checker inners) with cool freebies and specials. For instance, “Mayors” of Starbucks get a coupon…albeit a really lame one. Then these people who didn’t get it a minute or two earlier, start to see the value to them, as potential Foursquare users.

And as a side note, forget the pitch that you can use Foursquare to “see where your friends are”. My informal market research says that about 98% of non-nerds (and about 100% of non-nerd females) think this is totally creepy and passionately explain to me that this is a very strong reason for them to NOT use Foursquare.

ANYWAYS…so back to the value proposition that actually can attract new users. The freebies and discounts and rewards.

The big problem is the cheating. If your whole value proposition to the user is based around earning rewards for participation, but the mechanism for tracking participation is COMPLETELY full of holes and totally game-able, you’ve got a big problem on your hands. Namely in that people will get quickly disillusioned, angry, and quit. Foursquare game over.

So how can this be fixed? I saw the other day that businesses are going to be putting up Foursquare window decals (a lot like the Yelp decals you see around now), and my initial thought was that perhaps those decals would have a barcode that users could scan in order to check in. Which would be one slightly imperfect and slightly clunky way to solve the problem of check-in cheats. But it appears that these are merely endorsement/marketing decals and that’s about it.

But it got me thinking more about how and where the barcode scanning technology could work more elegantly within the check-in space. And more importantly, where could the check-in scan happen so that it effectively locked down cheating, and also upped the value of the check-in to both users and businesses?

What I ended up with was the idea that POS receipts in stores could include unique barcodes that Foursquare users could scan in order to get credit for a check-in. This wouldn’t necessarily have to fully replace the GPS based check-in system, but it would be a way for businesses to tie some subset of check-ins to not just attendance, but to ACTUAL purchases.

Within this sort of receipt-scan-based check-in system, there seems to be a lot of possibility for users, for businesses, and for Foursquare…

Users could get some sort of “verified check-in” credit, which perhaps could carry more weight than non-verified check-ins in terms of how these check-ins affected mayorships for retail stores.

Businesses again, would be able to start to really quantify, track, and understand the value of Foursquare users and tie check-ins to actual dollars. There is also the obvious potential for Foursquare to provide business with some generalized customer profile data here as well, which when tied with purchasing behavior and patterns, starts to get really really interesting for businesses.

And lastly, Foursquare gets into a better position where they start to lock down the cheating issue and develop a more effective system for pulling all of this together in a way that both users and businesses can really benefit from.

Obviously this idea works only for businesses and locations where an actual purchase can and would take place…but when it comes to cheating and rewards, this is the segment of businesses on Foursquare where this problem matters most. Isn’t it?

Two things I can get down with. I am a social media nerd and I love restaurants. I also love when the two meet, so this post on the Hill Holiday blog was right up my alley.

The last bit regarding 4Food was particularly interesting:

Is social media the secret sauce for restaurants? I recently heard about 4Food, an organic burger eatery opening in Manhattan later this summer. Plans include servers taking orders on iPads and a 240-square-foot monitor in the restaurant to stream Foursquare check-ins, tweets and updates from the 4Food staff. Will that sell more burgers? Probably not. What might though, is the company’s plans to use a custom online application to crowdsource menu development. In addition to getting an order “their way,” customers are able name and market their creations, receiving $.25 worth of store credit for every sale of their unique menu item.

PS, Check out my badly-in-need-of-an-update post from last year, Boston Restaurants On Twitter.

PPS, Hill Holiday, you should make your blog URLs a little more search friendly. WordPress permalink settings. Know them and love them.