Last year was all about Twitter; in 2010 it’s all about Foursquare or to be more precise about location based social networks. This trend has started, as usual, in the US, where New Yorkers have created a trend about sharing their location with friends.

What is a location based social network?

Basically, a location based social network allows you to share your location with your friends, and keep a record of every place you’ve visited. Networks like Foursquare, Gowalla and Loopt have GPS location features that allow people to pin their location via their smartphones.

Why are location based social networks the new trend?

Pete Cashmore from Mashable named Foursquare as the new Twitter of the year 2010, and his assumption seems pretty relevant considering that Foursquare grew 100.000 users in 10 days. In our opinion, location based social networks are the future because they open the door for the much expected location based marketing. Everyone saw this coming; the era where business will have access to their target audience location all the time, and they could target them directly.

The benefits for brands are so important that we are surprised that this social network concept wasn’t invented by an established brand. Foursquare and Gowalla can be efficient tools for companies to target their audience geographically and to interact with them in strategic moments of their day. Think about how it would be if you could receive a message from Starbucks inviting you to sip your morning coffee in their location near the metro you are just walking out of?

The possibilities of engaging with consumers are wide, and savvy tech brands have already learned that these types of social networks are a gold mine. From discounts if you are the “Mayor” of a place, to points that translate into a free coffee, even customized badges simlar to those offered by Starbucks.

Foursquare vs. Gowalla, which is better?

In our opinion, both social networks are good, but they could be used for slightly different purposes.

Foursquare is more focused on the activity of your friends, and on tagging popular locations across the city. It also suggests different locations according to your current one, and they benefit from a pretty clever system to engage users. They use a simple, but intelligent mechanism of offering badges to users. Every time you fulfil different criteria you receive a badge. This works as a wonder for ambitious people who want to gather as many badges as they can, so they start to use the network on a day to day basis, and fight for badges. More proficient users play the game for a higher stake, that of becoming “Mayor”. The user that checks-in the most in a certain location receives the Mayorship of a place. Foursquare also allows users to tip each other on cool locations they discover across the city. Foursquare is best to use if you are a person that goes out a lot or that visits many popular locations.

Gowalla is more focused on user’s activity. They have a better design than Foursquare, but their interface might be harder to understand for a newbie user. Gowalla is also a bit more focused on trips; the to-do-list is called trips, and the profile is referred to as passport, implying that it should be used more by people who travel a lot across the country or outside of it. When using Gowalla it is mandatory that you use a GPS phone because otherwise you can’t check-in.

Conclusion

Foursquare and Gowalla are fun and easy to play with from your smartphone. They provide users with the possibility of keeping a record of their whereabouts, and share tips with their network of friends. In the future, we will definitely see more real life perks for the users, and more battles for mayor titles and badges as the networks receive more traffic and users. We see no reason why companies wouldn’t embrace this trend, but they should have their arguments ready because no good thing comes without strings attached. As in the case of other social networks, the problem of privacy will soon appear, and everyone will start asking how secure it actually is to share your every location with the rest of the world.