By: Erika Stevens

Social media has dominated the marketing world for awhile now giving businesses more ways than ever to communicate with their customers.  By creating a Facebook page or Twitter account any business is able to collect fans and followers regardless of size.  Anyone that pays attention to social media knows that last week was a big week for location-based social networking announcements. Rumors had been circulating that Facebook would enter the location game and on Wednesday those rumors were confirmed.  With over 500 million users worldwide, Facebook has dominated the social media world and now enables those users to check-in using their Places application.  There are a number of location-based marketing companies such as Foursquare, Gowalla and SCVNGR but none have the same easy access to potential participants.  Before the announcement last Wednesday, only 4% of the US population was using location-based social media.  Facebook Places could make location-based marketing mainstream.  

The other big announcement was the partnership between Shopkick and a number of major retailers including Macy’s, Best Buy and American Eagle.  This new application uses a high pitched tone that communicates with an iPhone, automatically checking in customers and directing them to other places in the stores to earn more points.   In last week’s blog Eric discussed his view of rewarding customers for coming close, but not necessarily purchasing. 

Allowing customers to check-in to earn points and rewards at different locations brings social media closer to loyalty marketing programs.  I believe that social media is a wonderful tool to enhance your traditional customer loyalty program whether it is a points or transaction based program.  Businesses that are putting all of their energy into social media are not getting to know the customers who are the most loyal customers.  As a consumer who thoroughly enjoys social media and works in loyalty,  I can’t help but speculate about the limitations of social media when it comes to customer loyalty programs.  Come back next week to read about the challenges of using location-based social media as your loyalty program and how some companies are marrying the two.