Yesterday, Foursquare introduced a powerful new tool for small businesses: self-serve ads. The new ad product lets business owners pay to make their profiles appear higher in search results for nearby customers.

Foursquare launched Promoted Updates last summer, but up until this past June only bigger businesses were allowed to participate. A pilot program recently launched in New York, allowing a handful of small businesses to use the ad product. It appears the pilot went well.

“The idea behind these new ads is simple — connect people looking for somewhere to go with businesses that want to drive traffic to their stores,” stated the company. “Foursquare is the best way for those businesses to reach nearby customers.”

Self-serve ads are beginning to roll out to a “few thousand local businesses” and will be available to more businesses in the coming months. According to the announcement, businesses will only have to pay for their ads when people visit their location in person, or open their advertised listing in the app.

The new ads follow Foursquare’s newly launched Post Check-In Ads, which suggest locations and specials after an individual checks in to a nearby location. This particular ad unit is currently limited to a few partners, including Toys R Us and Captain Morgan.

According to Foursquare, 78 percent of people who search locally on their phone make a purchase — a promising metric for the service’s 1.4 million registered small businesses. Business owners and agencies interested in trying out the new self-serve ads, and you haven’t already been given access, should add their names to the wait list.

[Via: The Next Web, The Verge, Image credit: Praveen]