107-307640706_594eca815f_m.jpgRecently we answered the question “Where are Foursquare and Gowalla Going?“, understanding that the future of location-based social networking (or whatever they call it) was really down to a clear reward, most powerful financial.

It’s not enough to have a glossy location gaming product, it needs to actually benefit the consumer. Sure, early adopters will get behind something because it’s the new thing, but for the mainstream to adopt something and for it to stick, there has to be more than the “this is kinda cool” factor.

Gowalla has been loosing the location wars for this reason. Whilst they started before Foursquare, and unlike Foursquare, did not limit users to unlocked cities to begin with, Gowalla made the fundamental mistake of creating easily the coolest and most pretty service, but the least beneficial. On what actually matters for sustained usage, Foursquare beat them on all points:

  1. Foursquare saved you money. Gowalla didn’t.
  2. Foursquare was competitive and therefore an actual game. Gowalla wasn’t – it was more of a treasure hunt, but you couldn’t compare the treasure.
  3. Foursquare gave non-financial status in the form of “Mayor”. Gowalla took too long to.
  4. Foursquare was socially played. Gowalla was always individual.

The latest from Gowalla, as Mashable reports, is that it now is integrated with Facebook Places and with Foursquare, meaning “Gowalla even lets you earn Foursquare badges and Facebook Deals through the iPhone app. As an added bonus, Gowalla also pulls in Foursquare Tips whenever you check in.”

Right App for the Wrong Time

Whilst I admire Gowalla’s move to embrace a “complete rather than compete” position, I think it’s the nail in the coffin as it marks the end of their competitive mindset. Only when the leader in the market goes all open does it work in a organisations favour. Foursquare is still something like 10 times bigger than Gowalla, and Facebook is waaaaay bigger than Foursquare. Why would anyone but the innovating few use Gowalla to do what the Foursquare app that they like already does? And remember, geeks often don’t care much for design as much as I love how Gowalla looks and feels.

Most of all, it’s decision to, as CEO Josh Williams says, be a “socially curated guidebook” is a fundamental misunderstanding of where the market is today. Sure, one day, we will use apps to find new walks and new places to go. But for now, even the most early adopting of us don’t use them to find new places, and neither do the early majority trust an app to follow around someone’s suggested walk or new location to check out. In years to come – maybe. Today – no – unless it saves me money – and then I’d just roll with Fourquare or Facebook.

Josh just didn’t realise that early adopters are time poor and the early majority are trust poor, meaning Gowalla is just going to stay poor.

Gowalla over and out.

Your Leading Thoughts

  • Does Foursquare, in your opinion, beat Gowalla on all those points? And is Foursquare also being beaten by Facebook? Why?
  • Forget long term for a second – right now, what is the winning factor for location services that will enable to stick around long enough to think long term?

Coffin photo by Meanest Indian

Archived Comments

  • http://www.twitter.com/prbristolblog PRBristolblog

    I think that its a smart move by Gowalla. Yes they have been left out of the race for reasons you have stated, but (point 4) I would argue against as you can comment and share photos on Gowalla and you can’t do this on Foursquare, its not social – its competitive.

    I believe that Gowalla, will be come the “Hootsuite” of geo-location where geeks like us can check into Foursquare and Facebok at the same time, saving time and effort. (In a beautiful interface).

    Great post and thanks for sharing your thoughts.

  • http://en-gb.facebook.com/hojomo Howard J Moorey

    Thanks Scott for your insight.
    You are dead right that Gowalla trails Foursquare, because of errors in it’s crystal ball reading in the early stages.
    However, make no mistake, we are now in the endgame for BOTH Foursquare and Gowalla, as they have been.
    I have been an avid Foursquare user since it became available in the UK. Being fascinated by all things LBS, I also took to Gowalla, and, yes, like you, felt it lacked something. BUT it did offer something over and above Foursquare – the option to easily post a photo after you checked in.
    The Mayor thing in Foursquare is vastly over-rated – in commercial terms, regular and/or nearby check-ins are far more valuable to venues who choose to develop location-based services and offers. But it has offered the all important “game” element.
    With the launch of Gowalla 3 yesterday, they leapfrog their offer over Foursquare, but the latter will remain the best visible simply because 4 Million (and growing) users are getting something from it.
    By setting it’s stall out towards the future, Gowalla broadens and differentiates itself, whilst at the same time adopting the Open, Sharing characteristics we have all grown to love about Social Media, by embracing it’s competitors.
    The key feature is the fact they are embracing Facebook Places in it’s early, developmental stage and will thus stand a good chance of getting “dragged along with it” as FBPlaces comes into it’s own.
    All other services will be dwarfed once FBPlaces starts to gain traction, simply because FB is becoming the second most essential personal utility, after the mobile phone, for many individuals around this planet.
    Gowalla has made a shrewd move to grab & run with FB’s shirt-tails. Watch for Foursquare pulling the same trick over the months to come!

  • / Scott Gould

    Sure – Geeks will enjoy using it in the same way geeks use hootsuite.

    But how much longer will it be around for? Geeks aren’t enough to monetize with – which is why I don’t see hootsuite lasting for much longer either.

    My prediction: both dead by the end of 2011.

  • http://www.twitter.com/prbristolblog PRBristolblog

    Agree about the audience and this is the biggest barrier versus Facebook (the Gorilla in the room). I don’t know any (normal) people that are on 4Sq or Gowalla. But my point is that Gowalla has provided a convenient, functional and user friendly way for people to interact / checkin and tell their Friends on Facebook. Traction in the short term will be very important and it depends on how Facebook develops their Facebook own apps. At least Hootsuite has a revenue model now vs Gowalla. The biggest risk for both businesses is this though. If they get too big for Facebook / Twitter’s liking what stops them from switching off the API? You might be right about Gowalla but I think you can add Foursquare to that as well due to Google places API.

  • http://twitter.com/VelChain Dave Lutz

    Scott, another solution that is gaining traction on our side of the pond is SCVNGR. They’re backed by Google I/O and are also integrated with FB Places. They’ve definitely built a very social app and are making partnerships with big brands – Game Stop, ATT Wireless, etc. They’re model is more about doing things (Treks) and receiving rewards (stuff not coupons). We’ve got another year to two for the cream to rise to the top, but I’ve got money split 50/50 right now between FourSquare and SCVNGR.

  • http://twitter.com/Darrenux Darren J Smith

    It’s incredible what the psychological power of play, competition, and social hierarchy has on our behavior. Foursquare won (so far) because of of those pulls, not necessarily because it saved you any money.

    We’re yet to see who will win the location space, but I do like Gowalla’s move. I believe they’re also consolidating the 3 location databases (facebook, foursquare, gowalla) and will be opening it up as an API for other businesses.

    Want to know who will win this? Whoever partners with Groupon…

  • http://gearboxmagazine.com Brian Driggs

    You know, when Twitter began getting major publicity, it seemed the most common, first dismissive comment was, “I don’t care what you ate for lunch.” Those of us who believed in the potential of the service had to really sell the true, underlying value of making diverse, quality connections and real time conversation. Twitter has moved on, gaining widespread acceptance as a valuable medium.

    Ironic, then, the foundation of Foursquare and its ilk is people broadcasting where they ate lunch. Not necessarily the same thing, but very close. Whereas people shunned Twitter because they weren’t interested in such insipid updates, it seems LBS embraces this inanity.

    Pretty much any social media moppet can update Twitter or Facebook via API, but why aren’t there more utilities allowing users to selectively filter the content in their streams based upon the source. Why is it the only way I can block Foursquare updates in my Twitter stream is to unfollow a friend?

    Look. If you want to play Foursquare with your Foursquare friends, I have nothing against it, but I don’t care where you just checked in. I don’t care what fantastic, BS badge you just “unlocked,” and I could give a rat’s @ that you have ousted a random stranger as “mayor” of Whocaresville.

    The biggest threat facing LBS seems to be it’s dependency upon shallow narcissism. I am here… I just checked in… I did this… I unlocked that… I became… I ousted… There’s no conversation at all. Even when there are multiple people in one location, how does the Foursquare blather report it? “I’m at PLACE (w/ 42 others).”

    Bah. /vent

  • / Scott Gould


    I agree that Gowalla is provided a convenient idea, but as you say, there’s no revenue model here. Facebook Places with their massive user base are just going to steamroll this over.

  • / Scott Gould

    Howard – as I said this morning, I love your analysis here. You’re certainly more versed in this area than I am.

    What I will say is that I doubt this move by Gowalla is really that “social”. It’s open, but open is not synonymous with social.

  • / Scott Gould

    Hey Dave

    Not heard of SCVNGR so thanks for bringing them up – I will check.

    I agree, it’s still 2 years before this stuff really takes off. How it looks now is different to how it’ll look then.

  • / Scott Gould

    Hey Darren

    The psychology here is fascinating, I think Foursquare have got it the closest to the winning combination so far. But you are RIGHT ON when you say that the winner will be whoever partners with Groupon. Very insightful Sir!

    Thanks as always for your comments :-)


  • / Scott Gould


    I agree that the Facebook and Twitter spam that is made by Foursquare et al is problematic and turns people off.

    And you hit it on the head – THERE IS NO CONVERSATION.

    I agree with your vent!

  • http://gearboxmagazine.com Brian Driggs

    I actually signed up on Foursquare, summer 2009, but as Blackberry owners didn’t really count back then, the experience was terrible, I lost interest, and think I’ve only logged in once or twice since to approve friend requests. One of these days, I figure I’ll finally have the account closed, but I just don’t feel like wasting the time.

    It would be interesting to see Twitter updates: “I just checked OUT of Foursquare.” :)