NEW YORK - Location-based social media services such as Foursquare will become increasingly valuable to marketers for loyalty programs, according to an executive at the IAB Marketplace: Mobile conference.

While users now mainly use location-based technologies for their social utility, more of these services will start to provide added value to users of their platforms. Consumers who engage with brands in social media contexts are often doing so for material rewards.

?In terms of Foursquare, for example, the badges it awards are a means to an end,? said Ian Schafer, CEO of Deep Focus, New York. ?Really what it?s all about is loyalty programs.

?People will want to share this information to receiver more material and rewards,? he said. ?It will be money- or discount-driven more than social.

?For example, 25 percent of people who became fans of a brand on Facebook did so to receive promotions or discounts.?

Deep Focus is an interactive marketing agency that works with brands such as Nike, HBO and ESPN.

Location-based future
Mr. Schafer began the presentation by displaying a set of coordinates on the projector screen behind him.

?These are digits that most of you at one point this morning probably broadcasted with either your friends, your wireless carrier, Foursquare, Twitter or Facebook,? Mr. Schafer said. ?This is the game most location-based services in are ? taking these numbers and parsing them out and delivering you information that?s more relevant.

?These numbers are changing the way marketing and advertising works,? he said. ?If Facebook turned on location-based services tomorrow, there might be a half-billion people worldwide displaying information like this.?

Deep Focus works with Microsoft?s Bing to engage high-value mobile consumers with location-based technology.

Mr. Schafer explained that people using Bing from a social environment are four times as valuable, completing four times as many searches, engaging for four times as long and viewing four times as many ads.

Home Turf Finder
Mr. Schafer presented an example of how location-based technology could be used effectively in a marketing campaign, drawing from Deep Focus? own experiences.

He told the audience about the Home Turf Finder map application that Deep Focus carried out with Bing, Foursquare and Men?s lifestyle brand Thrillist

The Turf Finder was developed to help soccer fans find ?friendly? bars where they could watch World Cup matches using their mobile phones.

To illustrate the Turf Finder?s functionality, Mr. Schafer relayed an anecdote about two soccer fans loyal to a particular team who went to a bar with a devoted fan base for the opposing team.

The two fans were forced to wear the rival team?s jerseys to avoid detection, and when the time came to celebrate, they were forced to do so secretly in the bar?s restroom.

?The problem people have is that if they are in a major city, they don?t want to walk into the wrong bar,? Mr. Schafer said. ?If you?re a French expatriate, you want to go to a bar that might be showing your game, and where people might be rooting for France.?

Turf Finder used information generated by Foursquare check-ins and provided by Thrillist?s editorial team to generate maps for 11 major cities such as New York, Los Angeles and Seattle, showing which bars were playing World Cup games and which teams fans at those bars were cheering for.

?It would be a really daunting task if we were to poll each bar to find out what allegiances they had,? Mr. Schafer said. ?So we crowdsourced.?

For example, if fans included a message such as ?Go [name of team]? when they checked into a bar, that information would be indexed to measure how strong a particular team?s fan-base was at that location.

Foursquare provided incentive to fans who participated by offering special badges for completing two such check-ins.

?One of the reasons behind badges is to bring in the gaming dynamic,? Mr. Schafer said. ?It does you no good to win something unless it?s scarce.

?We wanted to make it special when someone got a badge,? he said.

Fifty percent of participating users earned badges through the initiative.

The Home Turf Finder initiative did not include tangible rewards for checking in, but Mr. Schafer said using material rewards to entice consumers on social media services could yield good results.

?Having virtual gifts tied to real rewards a good way to keep people interested,? Mr. Schafer said.

As location-based services become more widely used, it will be important for developers to understand how to leverage the data they generate.

?We spend a lot of time massaging APIs, trying to figure out how to leverage platforms that are creating these data,? Mr. Schafer said. ?That?s the business these services are in, and how they create value for themselves ? by having more data flow through these APIs.?

Final Take
At the conclusion of the panel, Mobile Marketer's Peter Finocchiaro interviewed Mr. Schafer. Here is the video: