Brian Solis is the author of the new book, The End of Business as Usual. He is also a principal analyst at Altimeter Group. AT&T has sponsored the following blog post.

Gone are the days when your customers would rely upon the brick of a paper directory formerly known generically as the phone book to make decisions about local businesses. Now, most take to Google to find local businesses and services; others take to Yelp and AngiesList; and some scour Craigslist and other local online directories to make the best decision. At the same time, a new genre of connected consumers are taking to their mobile phones and social networks to discover what’s around them using geo-location services such as Foursquare.

Foursquare is a mobile app for popular smartphones that combine a social network, local directory, and gaming platform. The idea is to connect with trusted friends to form a social network based on relevant geography. As you visit businesses, venues, locales, etc., you use the app to “check-in” to announce to your network where you are. Friends can see where you are where you’ve been. And likewise, you can learn more about your area based on what people like you are doing in your city. The more you check in to a venue, the more points and accomplishment badges you earn. Also, if you are a regular, you have a shot at earning the Foursquare mayorship based on the total number of visits, which displays your profile to everyone that visits.

Many businesses are starting to learn that there are advantages to these check-ins that extend beyond the points users earn in the app. Each check-in serves as a personal endorsement that announces to friends and visitors that they support the business or service.  Not only will peers see the check-in in Foursquare, but users can also connect other social networks such as Facebook and Twitter to their account.  This will broadcast the activity to friends everywhere.

Foursquare also provides the ability to leave tips for each location which act as guides and reviews for prospects considering whether or not to also check-in. Progressive business leaders are experimenting with reward systems and specials that offer visitors, and especially mayors, discounts or free products and services to encourage repeat business.

For example, Monique’s Chocolates in Palo Alto, California acquired over 50 new customers and earned over 100 redemptions for its special of “buy one get one free” for truffles. Each redemption also equated to a 25% return ratio. In comparison, the chocolate shop ran an ad in a local paper and acquired only one new customer at a cost of $300.

The app serves as a new platform for digital word of mouth that is incredibly influential at the local level. To date, there are over 15 million and growing users of Foursquare, and the service is designed to help you better engage with not only existing customers, but new customers who may never have found you otherwise.

Southern Hospitality BBQ in New York rewards new and returning customers by giving everyone who “checks in” a free pint of beer. To date, Southern Hospitality has served 5,583 pints of free beer.

Starting with a visit to foursquare.com, you can lookup your business to see if it’s already listed. If so, you can claim it by verifying your affiliation. Once you’re verified, a dashboard is unlocked where you can learn everything about how people have interacted with the venue to date.  You’ll see the total number of check-ins, the current mayor, as well as a list of everyone who’s visited to date and a list of the tips that have been left behind. Additionally, you’ll get insight into reach, time/day, gender, and other statistics to help you plan for the future.

The true potential of Foursquare is not in the activity that’s already happening; it lies in the ability to spark new activity to increase word of mouth and customer loyalty. Yes, all this is done through a mobile app.

To start exploring the possibilities of how to use Foursquare to help create a real world and digital community around your business, here are 11 proven tips:

  1. Create a branded page on Foursquare.com for your business – https://foursquare.com/create_page
  2. Offer simple, but limited coupons, specials and promotions to entice check-ins through your Foursquare dashboard such as samples or discounts.
  3. Reward mayors with something truly worthy of digital royalty. Let them know they’re important and appreciated.
  4. Advertise that you’re a Foursquare merchant.
  5. Host events dedicated to social media users to encourage simultaneous check-in, Tweets, and Facebook check-ins.
  6. Engage with consumers by adding Tips to nearby venues in addition to responding to those who leave tips for your business. Additionally, respond to customers on other social networks to broadcast updates outside of Foursquare.
  7. Study your dashboard to measure activity to improve experiences and increase activity.
  8. Develop a loyalty program for your most devoted customers by creating a tiered point system that unlocks specials and gifts the more the check-in, add tips, and share experiences on Facebook and Twitter.
  9. Create Happy Hour check-ins during off-peak or free-time to boost activity beyond current spikes.
  10. Host creative contests that incentivize people to not only check-in, but also share tips and photos to their communities.
  11. Get innovative by working with a marketing or technology consultant to develop custom experiences based on Foursquare’s open platform.  As an example, GranataPet in Germany gave pet owners a reason to check in. They designed a series of local billboards using Foursquare’s technology (API) that dispense dog treats with each check-in. The campaign led to a 28% increase in sales.