Facebook Credits: The Gaming Currency of the Future

Apr 13, 2012

Article Image

Nearly any Facebook user can expand his game playing experience on the social networking site simply by purchasing Facebook Credits: unlocking special weapons to help in the quest to take back the neighborhood in Digital Chocolate's Zombie Lane, beefing up culinary creations on Zynga's Café World, or unveil clues to aid in your search for hidden objects on Zynga's Hidden Chronicles.  As of July 1, 2011, all Facebook game and application developers with a purchasing system must user Facebook Credits.

How is that sitting with the developers?

According to research conducted by the strategic market intelligence and advisory group Global Intelligence Alliance (GIA), Facebook Credits are, by default, the best payment option for media content vendors and game developers. GIA interviewed 10 large social media and game developers from around the globe in late 2011 and the consensus was that the majority of payment options for social media gaming don't handle microtransations well.

According to respondents in the GIA study, mobile phone operators can take up to two months to process payments, and that's just too long. Credit cards aren't the most viable solution since some gamers don't even have them. Additionally, while global banks are great on the risk management side of things, respondents of the study found them to be lacking in many areas, including an understanding of online trends, user behavior and troubleshooting solutions.

Anna Räder, a GIA consultant based in Amsterdam, provided that research for this study revealed the elements an ideal payment platform for microtransactions would contain, including:

  • Easy integration
  • Viability with future services
  • Available in all countries
  • Low threshold for end users (such as one-click buying)
  • Chargeback capability

Facebook gamers can quantify that Facebook Credits certainly are simple to use. "I did it once and it was easy - actually too easy - in that it was like an impulse buy," says Katie Rags, a writer in Brooksville, Florida who likes to play Zuma Blitz. "And they let me pay with PayPal," she adds, "which made it even easier."

Jerinda King, a daycare owner in Springfield, Missouri, previously played FarmVille and now WeTopia, for both of which she's purchased Facebook Credits. "I used my debit card to purchase the first time, much like you purchase anything online, then the subsequent times it was already on file, so all I had to do was confirm and re-enter the security code," King states of her experience. "It's always been a simple transaction."

Facebook boasts that the Facebook Credits system supports over 80 payment methods (among them including PayPal, credit/debit cards, bank account and mobile phones) and is accessible to more than 50 countries globally. Developers keep 70% of the revenue generated from Facebook Credit purchases, with options to let gamers use credits as a payment method or as a currency.

While the names of the respondents in GIA's study cannot be disclosed, Räder provided some additional insight on their feedback. "One of our respondents (a game developer company) believes that Facebook Credits is already a major game-changer, as it has forced some game developers to rethink their business models in terms of handling payments," Räder reports. "The respondent was of the opinion that, for game developers, Facebook Credits is not only a ‘tax on profits' but also an ‘enabler,' making it easier for those who place their games on Facebook to handle the payments for in-game virtual goods and services."

The same respondent believed that the future for Facebook Credits may hold the ability to purchase in-game virtual goods that are also outside the Facebook platform. Game developers that offer games on their own websites could then have Facebook Credits as a payment option, even if the gamer is not playing through Facebook at the time. While Facebook currently charges 30% commission on Facebook Credits revenues, developers may decide that having it as an option for other platforms is worth the cost for the added convenience and familiarity it provides.

The GIA study concluded that Facebook Credits are the best option currently on the market for game developers due to its universal platform, array of payment options for the end user, global reach and social networking opportunities that might not otherwise be available. 

Related Articles

Looking to "simplify the purchase experience," Facebook has decided to get rid of the Credit system of payment on the site, according to The BBC. Users with a Credit balance will have the remaining amount converted into local currency. As a result of getting rid of Credits, game publishers will now be able to charge a subscription fee for playing games starting in July. Subscriptions are currently being tested by game companies Zynga and KIXEYE.