Facebook has released more details about Frictionless Payments and Buy With Friends — two new ways to spend its virtual currency Facebook Credits that it announced out our Inside Social Apps 2011 conference last week. Buy With Friends stories will only appear to users who play the game hosting the deal, and instructions for how developers can implement the two features has been added to the Credits API documentation.
Frictionless Payments Implementation
Frictionless Payments allows users to spend up to 30 Credits within a game without interrupting play with an “Are you sure?’ dialog. Users don’t have to go through the standard Credits interface, but instead make purchases directly through the game’s UI.
The system is one of the incentives Facebook is offering to developers that exclusively use Credits.Developers are required to display a user’s Credits balance somewhere in their app. If users have insufficient Credits to make the purchase, the app must pop up the Credits pay dialog so users can buy more. The Frictionless Payments API can only be executed within 30 minutes of a user interacting with the app.
The API call for Frictionless Payments is:
POST https://graph.facebook.com/[app id]/payments?access_token=ACCESS_TOKEN&from=USER_ID&to=APP_ID&order_details=ORDER_DETAILS
Monetization Boosts and Concerns
Frictionless Payments allows for impulse buying, and therefore increases conversion rates. Lolapps’ Ravenwood Fair has doubled its monetization, and OMGPOP’s Draw My Thing tripled its conversion rate by by implementing Frictionless Payments. Arkadium’s Mahjongg Dimensions has also implemented the streamlined purchase flow.
Developers may look to price their virtual goods below the 30 Credit cap to take advantage of Frictionless Payments. Users may grow accustomed to paying up to 30 Credits, and begin viewing anything costing more as a serious purchase that requires consideration.
There are some concerns that Frictionless Payments might lead to accidental purchases, though Lolapps chief executive Arjun Sethi has previously said that his company hasn’t received any refund requests. Others worry that malicious developers could manipulate users with system, such as rendering invisible purchase buttons within their app, causing users to spend Credits without knowing it. However, Facebook is currently only offering developer access to Frictionless Payments via an application process, and may deny developers based on their track records.
Buy With Friends Implementation
Approved developers can allow users who make in-game purchases to share a discount on the same item with their friends who play the game. Users are shown an update composer with the prompt “Unlock a [#]% off deal on this item for your friends by telling them about your purchase.” Friends can either make the discounted purchase in-line from the the news feed or follow a link and buy within the game.
Developers determine which items generate the Buy With Friends prompt when bought, the discount percentage, and the duration of the deal. Developers must configure a product and deal through the Graph API, determine if the user has access to the deal, and then may initiate the Buy With Friends flow. Developers can find sample code and a detailed description of the different purchase flows in the Buy With Friends documentation.
Impact of a New Viral Channel
Facebook says the developers who’ve tested Buy With Friends have found that “more than half of people who were offered a deal in-game decided to share it with their friends, and the engagement and conversion rates on the resulting posts were also strong.”
As there is no per unit cost for creating and selling virtual goods, discounts and sales can be a good way for developers to increase revenues. They can re-engage former players and inspire users who otherwise wouldn’t have converted to make a purchase because of the perceived value they gain from the discount.
As with other game content stories, only friends who play the same game will see Buy With Friends stories in their news feed. The feature may inspire users to form more friendships with people who play the same games as them in order to gain access to the discounts, which could increase the volume of unsolicited friend requests sent and dilute friend lists with people users don’t actually know.
Facebook hopes that the easier Credits are to spend, the more users will buy. As they are proving to support application monetization, Frictionless Payments and Buy With Friends may convince developers to accept 30% tax on Credits, which all applications will be required to use exclusively starting July 1st. Developers can apply for access to the APIs on the Credits Special Incentives support page.