So how exactly do they make money from free games?

I bet many of you wonder how is Zynga actually earning it’s money? If you don’t know about Zynga, I am quite sure you know about Farmville, addictive Facebook game that makes you play and improve your farm empire. There are multiple reasons for the success of the social games and online games in general. One of the biggest factors that made Facebook this big are games and Zynga are one of the biggest player in this field.

world of warcraft 8 300x247 So how exactly do they make money from free games?

So how does Zynga makes money? A lot of eyeballs are pointed to Farmville and many other of their popular games. When you have a lot of eyes watching, you have huge advertising space, and beside that advertising space, you are gathering demographics information. There were fiascos where Zynga was selling this info to information gathering company called RapLeaf.  Facebook wanted to put an end to that, so they had to redesign the system.  And third and most important part of earning through social games is actually the revenue from the sales of “social goods” or “in game goods”.  In order to explain how you can sell virtual products and how bear with this article.

why we play social games  182x300 So how exactly do they make money from free games?I have lots of programmer friends, teamed up with designers, making these complicated games, which keep failing. They’ve invested a lot of time in creating their very good products, but they stumbled on the 2 crucial aspects of social games success: 1. Marketing and 2. User Experience.  You need to pay in advance in order to obtain users and have them as testers of your game.  It’s crucial that you have that initial base of users that will pin point you the ins and outs of your product. This information is something worth paying for.  The goal of your game is to make the player identify himself as his in game character, make it extension of his personality.  The more time he spends playing, more likely he will be willing to pay for that new weapon/armor/farmhouse…  Because instead of waiting XYZ days, he will be able to get it straight away for a measly $1-2! That’s nothing to him, but it’s livelyhood of people who are making these games.

When you add up the viral effect of the social networks and addictive factor of social games you are getting the hungry crowd for your virtual goods, that don’t cost a penny to create!  There are many other examples of games that are succesful even without Facebook.  Biggest income champion of all is of course, famous World Of Warcraft!  Not only they are living off the subscription model, they are earning vicious amounts of money through sale of Bonus packs, additional in game cosmetic items, such as shiny mounts and in game pets.  Players themselves created a black market of in game characters where you can buy and sell your “hard work” to other players.  This is not according to the terms of service of Blizzard (creators of WoW), hence that’s why it’s black market.  It’s multi billion dollar entertainment industry, and as the time passes by, this market is going to get bigger and bigger, so why not take advantage of it and get into it, while it’s still in it’s early stages?

Since we’re all about branding I will share one MMO marketing strategy that I saw was implemented successfully by one local company. They were hiring online game players to play under the name of their company and spread the word about them, while playing. Now we’re talking about building a brand online, on all levels.

What tips do you have for networking within games?!


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