Real cash for virtual cash: FarmVille's business sense

Real cash for virtual cash: FarmVille's business sense

Summary: Through the growth of an online cultural phenomenon such as FarmVille, the game creators must have made millions. What is their killer feature in their business? And how could other software developers exploit this?

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TOPICS: Mobility
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FarmVille has become of the most popular social game applications for Facebook for my generation, and the creators must be laughing in almost incomprehensible proportions at the millions they must be making.

The application is a simulation-based game that not only involves community spirit by other application users with gifts and extra tasks (which give the recipient farm coins to spend within their own game), but exploits the virtual cash ("farm coins") based marketplace for real money.

See Screen Gallery: Real cash for virtual FarmVille cash

When a user accepts the game/application, you  are presented with a blank canvas with which you are expected to create a virtual farm. You can plant seeds and they grow over time, and when you harvest the produce you receive farm coins, which perpetuate further spending.

Like other simulation games, you build up to different levels and can purchase more and more items - decorations, animals, trees and produce of higher wealth which then give a more substantial return. It's addictive and keeps you playing by offering the farm cash incentive.

I've been playing for only five days and the feedback received from the game in terms of farm cashflow, the experience level received and the number of neighbouring farms accepted (from other friends in my actual social network) all make the game quite addictive. It doesn't take up much of my time and constantly offers further advancement to a better farm.

It's pathetic that an online game has gripped me so much, but it's truly fantastic. But what has impressed me more is the business side behind the scenes of the game itself.

If you tried hard enough, you could earn your farm coins and farm cash through buying and selling of produce and animals. This would take you through weeks of repetitive tasks. The urge to bypass this laborious process and inject your own, real money into the game to convert into farm cash and coins is constantly playing on my mind.

Until I did. I spent $160 (£97) in the course of one hour just so I could expand my farm and further my game.

The interesting side is the real money vs. virtual money system. While this isn't a new concept, exploiting the popularity of the game and the exchange of real money for further tools, plants, crops and decorations would have no doubt gripped so many people - myself included.

The trick when generating games or applications such as these is the monetary remuneration. Nothing can be created for a truly free amount, therefore this system of money exchange has propelled Zynga, the creators of the game, into an entirely new dimension. The key fact here is that you don't have to spend money to further your advancement in the game, but if you do then you have the opportunity to fast track.

The temptation to spend money to engage with this cultural phenomenon is constant, for myself at very least.

My point is that if you are a budding entrepreneur and struggling to consider ways of gaining financial reward from the software you create, something like this should be taken away with you to the next developer meeting.

Business software could work on a pay-as-you-use-a-feature process - such as Word which restricted areas of the application to only the very basic functions. By linking in your credit card and requiring the use of a feature - say a SmartArt feature once and once only - you pay a few cents to use the feature and as a result the overall price of the software would go down.

With this, every copy of the software would be suited to the person who may only use a small handful of features, each application would be customised for that particular person and piracy could also be nearly-eliminated.

Would this work? Could you see software going this way, or has Zynga got the nail on the head with their process? Comment away.

Topic: Mobility

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15 comments
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  • Nothing particularly new

    I remember in college my friends would play a game called GunBound, which was a Scorched Earth/Worms-style MMO (each player controlled an individual unit). There were certain upgrades that could only be obtained through real money.

    The game itself was (and still is) free to play, so it's sort of a Gillette-style business model--give the basic product for free or cheap, and make money on supplementary purchases. It has worked surprisingly well in many markets through the years.
    Third of Five
  • RE: Real cash for virtual cash: FarmVille's business sense

    Sort of like most of the freeware/shareware market already out there. You get the basic version with limited functionality free. But when you decide you want the advanced features you have to pay. It's a great business model if you have the right product which can be divided into tiers.
    dennis.london@...
  • RE: Real cash for virtual cash: FarmVille's business sense

    I got bored with it really quickly (~lvl 25) and I wasn't about to spend money on it (as I can barely pay my bills as it is.)
    athaki
  • RE: Real cash for virtual cash: FarmVille's business sense

    I love the game, but I cannot justify paying for banana trees. Personally, I like the business model, but I would be surprised if it can really make the amount you suggest in your post. I use a lot of other free services, like the Live services including Office.live.com and Hotmail. I would pay for these if they removed ads and gave more space. That is where I think businesses would do well. It is the convenience factor. For business applications to do well, however, they would need to be enterprise-level applications. That is one of the cool things about the Live services. You can hook up your own domain to them. You can get JohnDoe@abc.com from Hotmail.

    There are other social networking sites that allow far less for non-paying customers, which I believe is detremental to their success. The user never gets an opportunity to see how good an application could be, so he or she is less likely to spend the money for a full version.
    MadWhiteHatter
  • RE: Real cash for virtual cash: FarmVille's business sense

    I play this game everyday. I love it! I agree that it is highly addictive but I don't mind taking my time to get the biggest and best farm. Would I ever pay for it? Nope!
    lelupixie@...
  • Nickel and Dimed to death resistant.

    I'd rather pay up front and know what I'm spending than to be nickel and dimed to death. It is kind of like buying an old junker of a car when I was young and getting on my feet. The car itself was cheap which was all I could afford but every time I turned around I was buying something for it (brakes, points, plugs, belts, etc). Would have been better off to bought a more expensive more reliable vehicle. This isn't any different.
    Keeping Current
  • Farmville or Fuelville

    Problem with this scheme is that they have taken it to an absurd extreme. They offer up tractors, seeders, and harvesters, but they have very, very, limited usage. To be able to use them to handle a large garden, they actually want you to buy virtual fuel. To harvest, plow, and sew a 20x20 field, once a day, is $45.59 a month. It is already a huge issue, especially for users who feel that they have been scammed.
    FactsAreJust
  • RE: Real cash for virtual cash: FarmVille's business sense

    yea. its a rip off.. was fun for awhile and i also bought some extra coins/cash they take your money fine but to recive rewards is 50/50. close to a scam.....
    lukesgrampa
  • Harvest Moon for facebook?

    Well, I'm 2 things that are relevant to this discussion.... a recovering Harvest Moon addict (only reason I bought a PS1, Game Cube & a DS)and a resistor to the Facebook phenomenon. Everyone in my family (from Hell's Grannys to grade school kids) are on the site and I refuse to join....I guess it's part of my hermit mentality but I'm not interested in giving away my family photos and personal information. I'm just not a joiner....but this new evil lure, it is so tempting...thanks for the heads up Zach, I will have to strengthen my resolve to avoid this new way to waste my hard earned bucks!
    toddler321
  • RE: Real cash for virtual cash: FarmVille's business sense

    As an addicted Farmville farmer, I applaud Zynga for a great game, but for them to be asking for real money for a game which is still in BETA is disgusting. I recently lost a couple of days effort (coins and XP points), while my farm kept reverting to an old backup copy. If this had happened to cash I had actually paid, then I would suspect Zynga would be more than just morally liable for my losses.

    Paying my own money to help them sort out bugs in a BETA version of their game? I don't think so.
    DonGreen
  • Message has been deleted.

    DonGreenIsARetard
  • RE: Real cash for virtual cash: FarmVille's business sense

    http://www.farmvilleking.com gives you a chance to
    convert your farm cash points in to real dollar.

    ga082003
  • RE: Real cash for virtual cash: FarmVille's business sense

    This certainly isn't a new concept. Games like RuneScape and SOE's Free Realms do the same thing, not to mention Online Collectable Card Games have similiar models. Free to play but you have to play for higher end stuff. I've never really liked this model, especially when it get's targeted at kids. I think Zynga bringing it to the Social Networkinig Market is pretty brilliant on their part. I have a few friends that dished out money to get Halloween houses and costumes for YoVille that can only be bought with real money. Zynga has brought video game addiction to a whole new market of people. Although I agree they need to work out the bugs, but then FB and Myspace are so buggy that many don't even notice.
    Greenman76
  • RE: Real cash for virtual cash: FarmVille's business sense

    Farmville cash is broken down into two categories: coins and bucks. The coins are used for purchasing seeds, plowing lands, and buying most other items. You also earn coins when you harvest crops, trees, and animals.
    <a href="http://farmvillefacebookgame.com/farm-cash-money">Learn more about Farm cash money by clicking here</a>
    janiceholman
  • RE: Real cash for virtual cash: FarmVille's business sense

    any one who wishes to buy or sell a farm ville , mail me at sagitarius_alive@yahoo.com. u will get real money . u need to attach ur farm ville pic and i will contact u as i have buyers and sellers
    sagitarius_alive