Location + Discount Coupon = Party App

group picture retechsouth

Mashable unveils startup GroupTabs, which leverages group check-ins to “tip” a deal like half price drinks inside a business. The application is what was once called a “mashup” by using Foursquare and Twitter APIs to check-in and adding the tipping coupon feature of Groupon.

The business concept works because it feeds into the social need for the meetup and the financial incentive of a discount. Merchants win by activating viral marketing campaigns that brings customers who know each other into their business (and come back because they had a good time). It’s a fun app.

GroupTabs can monetize each merchant campaign conceivably with a set fee per checkin. Each single campaign won’t cost the merchant very much so the service will be easy to sell, and the business model seems like it will scale across bars and nightclubs across America. The aggregate revenue model is powerful because campaigns are repeatable, just like a subscription if you can imagine bars running a Tuesday Tipping night special.  I think it works.

GroupTabs portends three trends:

1) the building of location based apps off Foursquare and Twitter APIs elevates both as principal platforms, and make other stand alone location based apps like Gowalla less relevant.

2) The melding of online social networks and the physical worlds of bar life, conferences and the “where’s the party?” crowd gives meaning to “checking in”, and will accelerate trickle down adoption to folks who haven’t yet embraced social networking.

3) The trickle down use of location based apps like GroupTabs to trigger local deals will further define and position Twitter and Foursquare as hyperlocal services. Your “followers” were once scattered all over the country, they’ll soon be localized.

About Pat Kitano

Patrick Kitano works with brands in developing hyperlocal engagement solutions and is administrator of the Breaking News Network, a national hyperlocal network devoted to community service. He is the author of The Local Network on Street Fight, and is reachable via Twitter @pkitano and email pkitano@gmail.com.