Tag Archives: facebook

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Do you know Facebook now accepts Credit Card Reward points as a virtual currency?

 A recent, small though important development, in the payments arena came to my notice. American express – a leader in closed loop credit card business – has launched a new virtual currency for its merchants & small business owners which can be used on Facebook.

Actually, this virtual currency is nothing new, rather Membership reward points only. Thus Amex card members can use the merchant reward points accumulated on their card account as a virtual currency to buy advertising space on Facebook.

Thus in one shot AMEX has achieved:

  1. A way for its customers (read Merchants/Small Business) to reach 500 million potential their customers via Facebook ads & promote their business. (Already 35 percent of entrepreneurs use Facebook to promote their businesses)
  2. An incentive for its customers to use AMEX services more & more, and thus earn Membership Reward Points.3.  
  3. Customer loyalty & long term relationship
  4. Establishing a relationship with Facebook since they have accepted to redeem AMEX reward points as a virtual currency.
  5. Finding genuine ways to promote business for its customers. It’s a win-win for both Amex & its customers.

A step further in this direction could be the sale of Facebook credits for Membership reward points. Thus any credit card customer could then buy FB credits in lieu of his collected credit card reward points & then use these FB credits as a virtual currency in the Facebook social world.

Facebook_Gifts

Do you play Games on Facebook? Get ready for Facebook Credits.

With over 500 million users worldwide (source: Facebook) & the most dominant & largest social networking platform, Facebook has surged ahead by leaps & bounds. Facebook, with more than 50% control over virtual goods offered in social games on its network, is looking at as a huge revenue stream.
And this is where a new payment stream of ‘Facebook Credits’ will come in picture and add-on to the existing revenue line.

What is this?

While playing games online the players have the option to buy Virtual goods in the game. Virtual goods include weapons, tools, animals, and practically anything imaginable in the context of a social game. The currency used for such purpose is called the In-game currency. This is a virtual currency that a developer creates for use in a specific game or set of games. In-game currency could be “directly purchased by users with real money (i.e. Dollar, Pounds etc.).

Let me try share an example here:
While playing online Mario Bros. Game or Super Contra or Commando (oh used to love those!!) the player can buy an extra life or special weaponry etc. virtual goods. The player needs to pay using the in-game currency. The players can get this in-game currency by paying in real money (via Paypal / credit card etc.) to the game owners directly. Thus Social game developers generate revenue when users purchase “virtual goods” and “in-game currency” during game play.

Facebook Credits is a virtual currency system or an in-game currency system which shall be used by the social gaming audience on Facebook to transact & buy virtual goods in their social games. For example, in the popular Facebook game “Farmville,” players manage a virtual farm by growing crops and raising livestock. Players can purchase virtual goods like tractors. The currency shall be maintained by Facebook.

  

An extension to the Facebook Credits is that users can further use the Facebook Credit outside their games as well to buy Virtual Gifts. A Facebook user can purchase a virtual gift through the “Sending Gifts” application and give it to a Facebook “friend,” who would then have the gift displayed on his or her profile.

Source: Facebook, Send Gift on Facebook, http://apps.facebook.com/sendyougift/

Change is Law

  1. Presently, game developers have the option, but are not required, to use Facebook Credits as their sole in-game currency on the Facebook platform.
  2. Effective July 1, 2011, however, Facebook will require social game developers to exclusively utilize Facebook Credits for the purchase of virtual goods.
  3. Users must purchase Facebook Credits directly from Facebook and then use the Credits to purchase in-game currency.
  4. Users must purchase Facebook Credits from Facebook with a credit card, PayPal, Or a mobile phone.

 

Revenue Potential

  • Developer revenue from virtual goods purchased in social games in the U.S. totaled $865 million in 2010, and is expected to hit $1.25 billion in 2011.
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  • Facebook Revenue shall be a 30% of the developer revenue as game developers must pay a 30% service fee for all Facebook Credits purchases.
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Whats in store for the Future?

Mark Zuckerberg, the Chief Executive Officer of Facebook, has said that the company plans to do “a lot more” with Facebook Credits.

  1. One option is of developing it into a system for micropayments open to any type of application on Facebook.
  2. Thus Facebook Credits can be applied towards other online media products, or non-gaming digital goods, such as pay-per-view movies, TV, music, and news articles.
  3. Facebook Credits can eventually become a payment method outside of Facebook, usable for purchase of virtual goods on other platforms.
  4. Facebook will provide users with free Facebook Credits to watch advertisements for which third parties pay Facebook

Thus the future seems to all virtual. This is really astonishing where someone has created a virtual currency & virtual goods & virtual games, and real people are using real money to buy them to have real fun.

Is there anything you have to say about this?

 

Bet U don’t know: Difference btw Digital Media & Social Media?

People so often confuse the difference between Digital Media & Social Media Marketing.

Broadly speaking if you ask me, then this is the way I see how they are different:


– Digital Media is a communication media which includes both Mobile & Internet platform, where the message is usually communicated to the customer in a Paid format , e.g. mobile ads, facebooks ads, banners, online applications etc. Thus this is normally an interruptive mode of communication where the consumer is engaged via interruption in his daily life. And as Dave Evan wrote -> Basically advertisements have always been an Interruption strategy to seek consumer attention.[Picked up this line from my unfinished book Dave Evan's SMM:An hour a day]

Whereas

- Social media marketing is largely driven by the consumer acting as a voice of the brand on a social network platform.

It can be considered as an offshoot of viral marketing where something becomes so popular that it spreads like a virus from people to people in a viral fashion mainly driven by interest or word-of-mouth.

The modes could be display, video, blogs, pictures, articles just anything that keeps a user engaged.

You simply can’t pay to seek a consumer’s attention. There is no interruption, rather engagement.Now that’s the challenge because social media can’t be scaled by money. It’s a human driven effort like self-created, user generated and most often collaborated. No money in the world can do it. But yes what we can do is to try and understand the consumer psychology & what necessarily will trigger the passionate response from the consumers who are the kings & no more the objects.

P.S. I read somewhere that when you give people any challenge then they respond well. So I experimented with the Title of this post. Though the actual title can be just – “Difference between Digital & Social Media” . If you reading this, means it works!!


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