We’re not letting any cats out of the bag by proclaiming that location-based social networking is the next big thing. Talking heads have been falling all over each other to declare location-based services such as Foursquare, Gowalla, Yelp, and Brightkite this year’s “Twitter.” However, it isn’t entirely clear how businesses can best utilize these networks. Despite this problem, there are things you can do to be ready when the corporate strategies come along.

It’s easy to see why location-based networks are so exciting. We already have targeted advertising in which consumers see ads that will likely interest them based on their social media profiles. We’ve also seen how social media has become the new “word of mouth” where companies’ reputations are made and unmade. Because networks like Foursquare report a person’s location, each check in is a tacit recommendation of the business to the person’s network. The next step in targeted advertising are ads for businesses that appear when a person is near that business.

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