How To Make Money From Virtual Goods in Social Games: The Social Times Pro Report

I recently had a chance to chat with several leading executives from top social gaming companies for my first Social Times Pro report, "Virtual Goods in Social Games: What Sells Best, Who Buys Most, and How Your Company Can Profit". This is a must read if you're in the industry.

News that Zynga is attempting to patent virtual currency, whatever you think of the idea, highlights a larger point: Virtual goods continue growing as a major revenue source for social game developers, and competition among them is getting fierce. I recently had a chance to chat with several leading executives from top social gaming companies for my first Social Times Pro report, “Virtual Goods in Social Games: What Sells Best, Who Buys Most, and How Your Company Can Profit“. While the opportunities are huge, the executives I interviewed also warn of some fairly unique challenges that come with the category: For instance, Will Harbin, CEO of Casual Collective, creator of the hit social strategy game Backyard Monsters, warns fellow developers that virtual goods, because they don’t exist as a physical item, have less protections when purchased via PayPal, and that some players seem more inclined to try and game the system. Your customer service, therefore, should be prepared to deal with these eventualities. Other developers offered tips on boosting sales of virtual goods: Live Gamer CTO Bill Grosso, for example, recommends selling virtual goods as bundled pages: “Taking advantage of bundling is the biggest low low-hanging fruit to increase monetization,” he told me.

Much more in the full-length report, which features insights from these execs:

Dan Fiden, general manager at Playfish, the Electronic Arts-owned social game developer currently with some 45 million monthly active Facebook players.

Mike Ouye, vice president of monetization for CrowdStar, a social game developer with some 55 million monthly active Facebook players, which just launched a new Facebook game, It Girl, and three games in Japan on Mobage, Yahoo! and DeNA’s new PC social gaming platform.

Jim Ying, general manager, and Josh Burns, senior product manager for the North American division of 6waves, a social game publisher currently with some 45 million monthly active Facebook users.

Lisa Marino, chief revenue officer at RockYou, a social game/enterainment app developer with some 25 million monthly active Facebook users.

Bill Grosso, chief technology officer at Live Gamer, a virtual goods monetization company that services roughly 10 Facebook games currently with some 3 million monthly Facebook players, and recently announced a partnership with Sponsorpay, Europe’s leading monetization platform.

Will Harbin, chief executive officer of Casual Collective, a social/casual game developer currently with some 3 million monthly active Facebook players.

Teemu Huuhtanen, executive vice president, business development and communications at Sulake Corporation, the parent company for Habbo Hotel, which has several Facebook-embedded versions and totals 1 million monthly active Facebook players, and recently launched the “Habbo Meter”, which surveys their young userbase’s opinions on a variety of topics.

Much thanks to them, and all the execs who I interviewed for my upcoming report on virtual goods for iPhone games. More on that soon!