Foursquare Could Soon Start Charging Merchants
NEW YORK -- "Checking in" may soon cost merchants, as Foursquare is expected to start charging its 500,000 registered merchants to access its suite of services, according to a New York Post report. The services, which are currently free, would dramatically add to the top line for a company that has little revenue, the report said.
Consumers who "check-in" to Foursquare via Internet-connected devices are often granted access to special deals provided by merchants. Foursquare co-founder Naveen Selvadurai told the newspaper that both consumers and merchants are benefitting from its website. "Now we're able to close that circle," Selvaduri said. "[The check-in] comes back to me in forms of recommendations. It goes back to [users] in interesting ways."
Foursquare has a reported $600 million in valuation following a recent $50 million round of financing. However, its only revenues come from a few "high-profile branding deals" with companies such as Groupon, according to the New York Post. eMarketer analyst Noah Elkin said it would be difficult for Foursquare to charge merchants for premium access, considering the service has been free all this time. However, he said there is "value in the analytics they can provide a merchant," he told the newspaper.
Selvadurai would not tell the New York Post when Foursquare would begin charging merchants.