Internet companies have appropriated the real estate business’s mantra — it’s all about location, location, location.
But while a home on the beach will always be an easy sell, it may be more difficult to convince people that they should start using location-based Web services.
Big companies and startups alike — including Google, Foursquare, Gowalla, Shopkick and most recently Facebook — offer services that let people report their location online so they can connect with friends or receive coupons.
Venture capitalists have poured US$115 million into location startups since last year, according to the National Venture Capital Association, and companies like Starbucks and Gap have offered special deals to users of such services who visited their stores.
But for all the attention and money these apps and Web sites are getting, adoption has been largely confined to pockets of young, technically adept urbanites. Just 4 percent of Americans have tried location-based services, and 1 percent use them weekly, according to Forrester Research. Eighty percent of those who have tried them are men, and 70 percent are between 19 and 35.
“Ever since mobile phones and location technology got started, there have been conversations about the potential for doing something really incredible with this for marketers,” said Melissa Parrish, an interactive marketing analyst at Forrester. “But clearly the question is whether it has reached the mainstream, and it looks like the answer is no.”
Foursquare, for example, which lets people “check in” to public places on their phones and let their friends know where they are, has close to 3 million users, most of them in cities. Loopt, a similar service, has 4 million users, about a quarter of whom actively use it. Compare that with Twitter, which has 145 million registered users.
Last month, Facebook introduced Places, which adds some Foursquare-like features to its social network. If Places catches on with Facebook’s 500 million users, many think it could bring location-sharing to the masses.
“Clearly location is not yet mainstream — it’s still a younger-demographic phenomenon — but if anyone can change it, Facebook will,” said Sam Altman, chief executive of Loopt.
For now, many people say sharing their physical location crosses a line, even if they freely share other information on the Web.
Stephanie Angelucci, who is 30 and lives in North Beach, Maryland, updates her MySpace page with photos of her babies, news about her health and testaments to her love of sailing. But she will not use location apps.
“I don’t like broadcasting where we are or when my husband’s gone, just for safety reasons,” she said. And privacy concerns aside, she does not see the need: “We go to playtime, the park and the grocery store. My life isn’t exciting enough to broadcast where I am and what I do.”
Some users of Foursquare like the spontaneous social gatherings it can inspire, or the way it keeps friends informed of one’s nightlife exploits. But people who are not frequent bar-hoppers need other reasons to check in. The companies that make location-based services are working to add incentives that they hope will reel in a bigger audience.
Sharing location becomes a simple cost-benefit analysis for most people, said Matt Galligan, chief executive of SimpleGeo, which sells location technology to companies building apps. “There has to be an incentive for giving away very specific information, like coupons or points.”
Shopkick, which became available in the US last month, offers coupons to people when they walk into stores like Best Buy and Macy’s. The application allows users to share their location just with the store and not with other people, and is making inroads with a broader demographic.
Elizabeth Aley, 38, a volunteer in Nixa, Missouri, said she is “kind of addicted” to Shopkick. She uses it when she goes to Walmart, Target and the Price Cutter grocery store to rack up points for entering the stores and to get coupons that she has exchanged for Tide laundry detergent and a Swiffer.
Aley has chosen to use the app to also reveal her location to her Facebook friends and Twitter followers. The rewards make using the app worthwhile, she said, and
the privacy trade-off “really never crossed my mind.”
Gowalla bills itself as a travel game that lets users stamp digital passports at places they visit, find virtual objects in real-world places in a kind of scavenger hunt, or follow trip itineraries in new cities.
“Connecting with friends is nice, but I don’t know that it alone will be enough of a driver” to make a location service widely popular, said Josh Williams, a Gowalla founder.
Foursquare hit upon the idea of allowing people to become “mayor” of places they visit most frequently, sparking competitions among users. Now it is teaming up with big companies and small stores so people see special offers when they check in, whether they are in Brooklyn or Milwaukee.
The company has also signed promotional deals like a recent one with the History Channel, which sends users historical facts when they check in at a landmark.
“It’s a misconception that the service is just for city kids,” said Dennis Crowley, a Foursquare founder. “Cities have the densest use, of course, but it happens in the Midwest and all over the world.”
Still, wariness about broadcasting one’s location extends to city dwellers, too. Marsha Collier lives in Los Angeles and writes a series of For Dummies books on technology. She uses Whrrl and Foursquare as a way to share information about her life with her online fans and followers — but instead of checking in when she arrives at a place, she checks in as she leaves, to avoid alerting people that she is away from home.
“If I’m going to go work out at the gym, I’ll check in on my way out,” she said. “That way, you’re going to be home soon, so your house won’t be unattended for a long time.”
Others let only a small circle of people see where they are. Ellen Lovelidge, 27, a fishery specialist and DJ in Washington, carefully chooses who can access her Foursquare updates. She does not plan to use Facebook’s new service, since her Facebook updates go out to a large network of friends, colleagues and family.
“I like Foursquare because I can actually pick who sees where I actually am, compared to Facebook, where I have 1,200 friends,” she said. “I don’t want 1,200 people knowing where I am.” Facebook does let users pick a smaller subgroup of friends who can see location updates, but Lovelidge said it would be too much trouble to set that up.
Location services are catching on more quickly with young people, who have grown up posting personal information online.
“The magic age is people born after 1981,” said Altman of Loopt. “That’s the cut-off for us where we see a big change in privacy settings and user acceptance.”
That rings true for Richard Sherer, 65, a freelance writer in Redondo Beach, California. “I can’t think of anybody who cares where I am every minute of the day except my wife, and she already knows,” he said. “Maybe it’s a generational thing. As we old fogies die off, maybe this will no longer be an issue.”
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