American Express® is now offering discounts to shoppers via Foursquare, the social network that allows its users to access special offers and prizes when they use their mobile phones to check in at their favorite businesses. The service exploits GPS tracking on smartphones. Once American Express® cardholders sign up to the Foursquare network, they can enjoy the special offers from participating merchants.
This partnership will enable American Express® to reach a younger public—a massive user of social networks—and expand its network of merchants, while allowing Foursquare to enter into the business of shopping by mobile phone and to increase its user traffic. And shops, hotels and restaurants should see their sales increase, thanks to the more than seven million potential customers in the social network. This alliance will establish a new relationship between online consumer behavior and offline consumer habits, encouraging consumer evangelists to recommend products and services to their friends.
The alliance between the two companies as consolidated after a successful pilot program conducted in March 2011 in Austin, Texas. More than 60 stores participated in the “Spend $5, Save $5″ campaign, offering Foursquare members a $5 discount on the purchase of any of their products if they checked in at the store and paid with an American Express® card.
The program has been funded entirely by American Express®. For the company, it was the first phase of a process in which merchants will ultimately establish the special offers. Like other companies in the payments industry, American Express® is currently endeavoring to attract tech-savvy customers that in the future, will make their purchases via mobile phone. Foursquare is participating in the initiative for free to gain visibility. Initially, it will not make any money with this campaign, but it hopes to eventually see some revenue by charging merchants for the discounts or by sharing profits made by American Express®.
+ info: Mashable Business