This week, Facebook decided to shut down location-based social travel app Gowalla after acquiring the company last December. This is not a surprise to tech insiders who called the Gowalla acquisition a pure talent play, although Facebook claimed they bought Gowalla to beef up their location services.
The closure of the service might disappoint some loyal Gowalla users, but many users bailed on the service after vocally freaking out upon the release of Gowalla 4.0 back in September.
When a service shuts down, it’s always easy for know-it-alls to swoop in with opinions about could haves, would haves, and should haves. It’s easy because we can look back at blog posts, app reviews, and user comments to see when the company made wrong turns. We never had to make hard decisions in the boardroom. We don’t know about financials and conversion rates. But there is always something that we can learn when we look back at the life cycle of a startup post acquisition.
Whelp, I’m one of those know-it-alls. Here’s what I think Gowalla should have done:
First, let’s address some of the major problems with Gowalla, which caused me to delete the app from my phone last year:
No compelling use case.
I started to use Gowalla (now defunct), Brightkite (now defunct), and Foursquare within a few months of each other. I shared location-based photos with Brightkite, I checked-in to earn badges with Foursquare, and I picked up and dropped items with Gowalla. Checking in and posting location-based photos made sense to me at the time. Dropping and picking up items didn’t. I played along for a while. I picked up a cycling jersey, an espresso, and a few other items that I promptly forgot about. The problem was that the items weren’t relevant. The point of Gowalla according to the founders was to encourage people to get out and explore the world. But, these little dropped items never inspired me to do that.
Gowalla also offered up a way for users to create lists of locations, like a tour, for other users to check out. The problem for me was the the tours were either uninteresting or not complete. For example, I lived in Denver, CO at the time, and I would look at some of the pub crawls tours, thinking, “Really?! They left out Rock Bottom Brewery?!” I soon lost trust in a lot of the user generated tours.
The product was inaccurate and unfocused.
This announcement of Gowalla 3.0 in December 2010 says it all:
Simply tap the Check In button that is universally present in the tab bar and based on your previous history and current location, we’ll auto-fill where we think you are. We get it right about 80 percent of the time. In the cases where our best guess was a little off, it’s super easy to select the correct location with a couple quick taps.
Ugh . . . you get my location right only 80% of the time? You are a location-based app, though . . . right?
With the 3.0 release, Gowalla tried to become the default check in that you could push out to other services like Foursquare or Facebook. Gowalla also aggregated location-based info for all of these sites so that you could see where your friends were checked in, no matter what service they used for the check in.
Stamps and items not exciting.
Gowalla had a kitschy UI that emphasized cartoonish pins and stamps. They even designed custom pins for business development partners. But collecting them kind of felt like my mom’s touristy silver spoon collection. Sure, you get to display where you have been, but does the collection really matter?
What Gowalla should have done:
Monetize Business Development for Dropped Items.
VaynerMedia teamed up the the New Jersey Nets to drop tickets around NYC that could be redeemed for actual tickets to the game. Of the 500 tickets dropped, 76 of them were used. Co-founder of VaynerMedia, Gary Vaynerchuk, was also an investor in Gowalla. Although the Nets initiative was not a huge win, it solves one of the problems that I had with Gowalla – the dropped items were never relevant to my life, much less worth anything. Gowalla should have monetized dropped items more by offering brands a chance to drop items that could be redeemed for real prizes on a regular basis. Although they did some business deals like this, the dropped items never equated to winning something that a user really wanted.
Although one of Gowalla’s core values was to help people discover and remember new places, Gowalla did not do a great job of letting merchants tell their own stories. Gowalla did introduce curated city experiences with venues, but the stories were more focused around the user rather than the merchants. Foursquare won the location race because they were focused on monetizing merchant participation.
Gowalla executed on some excellent business development deals with Disney and professional sports leagues. But Gowalla never really acted upon what motivates people to participate within travel apps: people want travel deals. Although Gowalla offered a number of custom Disney pins for attractions like Space Mountain, users would be more excited to collect these pins if they could win discounts on airfare and free tickets to Disney attractions.
Overall, the fatal flaw in Gowalla’s strategy was that the demographics didn’t match up with the core function of the product. The cartoonish interface and the “discover your world” values were built for young people getting out into the world for the first time. But the core product of collecting pins and stamps in a travelogue app appeals to an older demographic. When you are young and using location apps, you want deals, and you want the deals to be at bars and restaurants. Foursquare knew this, and jumped on the market.
There is not doubt that the Gowalla founders will take what they learned and work with the Facebook team to improve their location features, but this time around let’s hope they focus less on the cutesy pins and more on the value proposition for users.