American Express engages Foursquare to take on Social Network

Foursquare is at it again. They are always finding new ways to change the world. Not only have they launched the Foursquare 3.0 app, but now they're partnering with a global credit card company, American Express. Everybody is waiting to see what they do next at the Southwest Interactive Festival.

The Wall Street Journal describes the deal with the following statement, “Under the arrangement, AmEx customers can register their cards in the Foursquare system to get access to special offers from merchants who are also Foursquare participants.

Customers who shop at those merchants with an AmEx card will receive credits and electronic notification that they have redeemed the offer. Merchants who participate in the program would potentially see more sales.”

American Express in no longer the stodgy company they once were thought to be. Here's how they're upping their cool factor:

• Not only are they finding unique ways to ramp up charges, but they are also speaking the language of their younger customers as they partner with the hottest company on the net. In the past, they have made several attempts to connect with the younger crowd. They have been marginally successful. I think this may finally be their moment.
• They also have a huge head start in the mobile payment space, which basically allows you to pay for your groceries through your phone. This space is growing as we speak, and is expected to become a $600 billion business by 2013.

Foursquare is making its way to the “big leagues” and getting over the hump. Here's how they're doing just that:

• This is Foursquare’s biggest deal ever. They have had minor deals, such as designing a special badge for Starbucks and working with American Express in the past to create Social Currency.
• They are strategically getting their “feet wet.” Now, American Express members can become customers or at the very least become familiar with what Foursquare does. Recruiting members will bring in new business from merchants and credit card companies.

While this is seemingly a genius idea for both Foursquare and American Express, you have to wonder if this is all just a bunch of hype?

• The partnership is still in its early stages and has not included “check-ins” Check-ins basically provide evidence that the user actually bought the item and is not checking in from their car.
• Foursquare still has to make money in order to survive the competitive world of social media.
• Considering Facebook has already dominated this market, it is important to make a bold move soon.