NiteFly

Recently, we have seen the dawn of the “Real-Time” and “Location Based” ages. People—myself included—spew vast amounts of relevant and irrelevant information/data bites on sites like Twitter and Foursquare(http://techcrunch.com/2009/06/25/foursquare-push-notifications-for-the-ultimate-in-friend-stalking/). Regardless of whether you want to hear how I just caught the last bus by a second or checked into your mom’s room, I clearly want to talk about it. For that simple reason, this data goes out into the ether to be viewed or not by whoever sees fit.

Twitter took a great step forward by allowing people to share information about what’s happening “now” around them. This effectively creates a second—arguably more relevant—layer of information, enabling real time news and interaction in the moment. Likewise, Foursquare took another great step forward in imposing relevance on ambient information. By creating these “location buckets” where people spatially tied to an area can pipe up and share information, they form networks of interest grounded in reality. It’s actually pretty cool to know that you’ll get a free brew if you check into the pub enough and I would rather avoid the server who takes 45 minutes to bring my snacks with a stank face.

While both excellent and fast growing services, there are many more innovations to come that will change the way we communicate just as these two did. Both companies—in my estimation—are a step towards what the Foundry Group terms the “implicit web” (http://www.foundrygroup.com/wp/2008/03/theme-implicit-web/). At the heart of that concept lies leveraging networks of relevance to contextualize the vast amounts of information poured into you every day. Great idea, but in practice, it is far more difficult than one might imagine. Computers, for all of their speed, are dumb as rocks when it comes to making non-explicit connections and synthesizing imperfect data. The task then is to create better data. New types of data using all of the inputs at your disposal.

The great companies of the past decade first created new types of data (Facebook profiles, Twitter Updates) then scaled, fighting to the death to reach critical mass. We’ve seen this play out with Google v. Yahoo, Facebook v. Myspace, etc. Now we’re living through the “Location Wars” (http://techcrunch.com/2010/03/09/twitter-location-website/) and the main combatants are Foursquare and Gowalla. These companies offer a mashup of mobile, local and social datastreams. The “new data” in this case is where you are, what you’re doing and with who. To be clear, I don’t know nor do I care who wins. What I know, is that "Check-In"--and more abstractly--location based data will soon be a commodity and the player with more scale will win out. The winner will wind up operating as a high level platform/conduit of information. Small Business can’t keep parceling off their deals and people can’t keep checking in to multiple services. It’s downright ineffective. Tech Crunch’s MG Siegler calls it Check in Fatigue (http://techcrunch.com/2010/03/19/check-in-fatigue-location-war/) and I agree.

What interests me about this whole brouhaha is the wave of innovation that will come out of the combined streams of mobile, social, local and real time data. The potential for mashups and innovative products that harness the data for a real purpose is incredible. My bet (and also the reason why I started my company) is that the real winners will be people who dig down into a particular vertical and really master the relationships between users and the spaces (venues in my case) that they interact with.

Specifically, this means:

1) Stand on the shoulders of Giants: Nobody wants to duplicate their profiles or double-post. Use existing social networks like FB & Twitter to harness the data flow without wasting time re-inventing the wheel.

2) “Dig down into a vertical”: Your company should be building and managing relationships with the people in your space. You can’t know every establishment owner across Bars, Bakeries, Coffee Shops, Skate Parks etc. Choose one “type” of establishment and get to know the dynamics of that industry.

i.e. if you’re building a mobile, social, location based product for bakeries then you should know when each shop buys and bakes their bread, which one currently has the toasty bread and how long the lines are at each establishment.

How you get that data can span from user generated, establishment generated to even static data (Foursquare check in % increases and decreases to extrapolate line length, twitter feeds to target specific bakeries to highlights, bake times from the bakers themselves and static data historical data to back everything up). Knowing your users’ patterns can help you build data useful to the bakers (sales drivers…is there a latent population of corporate lunch goers a block away that should be advertised to?) while the bakers provide data useful for the users. This exchange of information--rather than a one sided stream--will be incredibly important. Currently, we have a situation where the users are yelling "I'm Here! I'm Here" and the establishments are shouting "Deal! Deal!" but the mechanisms to connect the two effectively are just not there yet.

3) Advertising by Incentives: Nobody likes standard ads on their phone. Location based advertising needs the kind of quid-pro-quo that’s beginning to become popular through Foursquare. Allow your users to interact with establishments in creative ways. i.e. a sporting goods chain hosts a “race for kicks” where users do verified check ins to one store and another store a couple of miles away acts as the finish line verifying check ins and offering a free pair of running shoes to the first 3 to finish. Maybe those shoes are sponsored by Nike or Asics. There’s a million ways to engage customers, a good platform should always have an idea for establishments to engage customers.

There's my two cents. For my vertical? I choose Nightlife. Why? I’ll explain that next post but suffice it to say, it’s very, very ripe.