LocalResponse Turns Check-Ins Into Instant Marketing Opportunities

If you managed a major brand-name product, how much would you pay to be able to advertise directly to consumers right as they were arriving at a place where your brand is sold? Nihal Mehta, CEO and co-founder of New York-based LocalResponse, is betting that most consumer-products makers would say “a lot” when asked that question.

Today LocalResponse launched a new tool that allows companies to see, in real time, people “checking in” to places where their product is sold. But LocalResponse can detect check-ins far beyond those that are registered on Foursquare and other location-based social-media sites. Mehta and his team developed and patented a technology that translates natural language into check-ins. So if a fitness freak tweets “On my way to the gym for a workout,” Coca-Cola can see that person is likely headed someplace that sells its Powerade sports drink, and answer back with a coupon for the product.

LocalResponse’s brand platform is the latest step in the company’s top-to-bottom reinvention. Mehta started the company in 2007 as Buzzd, a site that aggregated check-ins from Foursquare, Gowalla, and other location-based sites. “It was like a heat map for consumers to see what was happening in their city,” Mehta says. He managed to raise $3.5 million, but realized rather quickly that success was far from guaranteed. “It was a very crowded space, and Foursquare was starting to get a lot of attention,” he says. “Plus it was hard to monetize that business.”

So Mehta and his team decided to turn the company from a consumer-based site into a business-to-business platform. In December, they raised $1.5 million from a slate of investors that included Verizon Ventures, Penny Black/BOLDstart Ventures, Charles River Ventures, and Greycroft Partners. Then they worked as fast as they could to try to get out in front of a market that Mehta believes they have an opportunity to lead. “Foursquare accounts for only 3 percent of all check-ins,” he says. “The ability to create check-ins around natural language is what makes us unique.”

On April 19, LocalResponse launched its first tool, a platform that allows local businesses to target customers who are visiting their stores, restaurants, or other venues. Those companies can see how many customers are checking in at any given time and … Next Page »

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