American Express Co. cardholders that attend the South by Southwest Interactive music festival in Austin, Texas, will be able to obtain merchant discounts with their cards through Foursquare Labs Inc., the location-based mobile system.
The companies said Thursday that they are pilot testing the system with more than 50 merchants at the festival and are offering a "spend $5, save $5" promotion.
Other payments industry players and social media providers may follow suit with similar initiatives, an analyst said. "I would expect to see further integration and partnerships between the legacy payments industry and social networking platforms like Foursquare," said Megan Bramlette, director of knowledge management at Auriemma Consulting Group of New York. "This is the missing link for Foursquare; a promotion like this can actually drive sales among a savvy, first-adopter audience." Before the Amex deal, quantifying incremental sales from Foursquare users was difficult, she said.
To use Foursquare, consumers "check in" to a location via a smartphone application or text message. Users share their location with friends while collecting points and virtual badges. Foursquare enables users to bookmark information about venues they want to visit and relevant suggestions about nearby venues, according to the company's website. Merchants and brands leverage the Foursquare platform by using tools to obtain, engage and retain customers and audiences, it said.
