Foursquare hasn’t been performing as well as it would like over recent years. In fact, the social check-in site actually took on $41 million of debt in an attempt to hit the aggressive financial targets the company set for itself in 2013. It seems that self-serve ads are to make up quite a bit of those targets.
Self-serve ads are already being used by Facebook, Google and Twitter is building their own at the moment. The idea is for small business advertisers to purchase ads on the social network and only pay if the ad is actionably used. So if a person clicks on an ad they see on Foursquare, then checks in at the listed business, or redeems an offer there, then the vendor will pay a set fee to Foursquare.
Getting started with the app is fairly simple. Vendors simply upload a picture of their business, choose list the special offer or a consumer tip to go with the ad and then click for the ad to go live. In a twist to the normal ad purchasing process, Foursquare actually target the consumers for the vendors without the businesses having to give any indication. Foursquare believes that their vast experience with foot traffic has given them a huge insight into how consumers think which stands businesses at a nice advantage for using the Foursquare self-serve ad service. Vendors are able to control their ads from an easy to use interface within the app and they can also set a cap on the amount of money they would like to part with each month during the campaign, although there is a $50 minimum amount per month.
Foursquare was reported to bring in a meek $2 million over the course of 2012 which has obviously forced them into looking at how to bring in revenue. There have even been rumors that the company may have been talking about acquisition deals with the likes of Microsoft, Apple and Yahoo. The self-serve ad campaign has brought in brilliant results from the test process which was carried out over the last 12 months using 1000 businesses around the world. According to Foursquare’s product manager, Noah Weiss, Foursquare is ahead of schedule with their financial goals this year. It’s expected that the social site will be back up into the $15 – 20 million revenue ball park this year.
[Image via ReadWrite]