Creating a Bull Market: <br />How to Manage a Successful Virtual Economy<br />Vikas Gupta, CEO<br />SocialGold<br />July 2...
In this talk…<br />About Social Gold<br />Basics: What, Why<br />Elements of a Virtual Economy<br />Monetization<br />Grow...
Who is Social Gold?<br />The leading virtual goods monetization platform<br />Launched in Sept 2008<br />Grew 2000% in rev...
The Social Gold PlatformAll the Critical Tools to Help Manage Your Virtual Economy<br />Micropayments<br />&<br />Subscrip...
 Customer Service
 Fully Hosted Solution</li></li></ul><li>Social Gold Customers<br />Social Games  |  Casual Games  |  Virtual Worlds<br />
What Exactly is a Virtual Economy?Why do people buy Virtual Goods?<br />
Consumer Behaviors & Habits<br />How Much do People Spend on Virtual Goods?<br />
Some Examples of High Spenders<br />$14,794<br />$11,635<br />$25,540<br />$13,960<br />$19,054<br />
Virtual Goods enable much higher spending behavior in loyal users<br />
The evolving internet business model<br />
We are moving from a world of “Free” to a universe of “Paid”<br />Beauty of a Good Virtual Economy: You can “buy” without ...
Elements in an Economy<br />Labor<br />People<br />Goods<br />Currency<br />
“Labour is the real measure of exchangeable value.<br />Wealth is power of purchasing labour.”<br /> Value in your economy...
Virtual Currency: Means to an Experience<br />
Why Virtual Currency?<br />Separate “Value” from “Cost”<br />Virtual currency is “cheaper” than “money”<br />Train User Be...
Building It:  Who Are You?<br />What you build will vary based on who you are<br /> i.e., game, social network, publisher ...
Robust analytics are key to managing a successful virtual economy<br />
Number of transactions is a good measure of the health of your economy<br />
Measure Sources vs Sinks<br />
Tools for monetizing yourVirtual Economy<br />
User Experience<br />Weave payments into your user experience!<br />Example:<br />Playfirst’sChocolatier powered by Social...
User Experience<br />Example:<br />Playdom’s Poker Palace powered by Social Gold’s In-Flash Payments<br />
Payment Methods<br />Credit cards drive majority of the revenue<br />Mobile phones (teens/international)<br />Pre-paid car...
Subscriptions to complement Currency<br />Demonstrate Economic Value<br />Asks for more commitment from users<br />When do...
More…<br />Inventory Management<br />Risk, Fraud control<br />Localization<br />Come by Social Gold’s deeper dive into the...
Growing your Virtual Economy<br />
Make it a Standalone Economy<br />Go beyond “stored value”<br />e.g., Linden Dollar vsFacebook Credits<br />User generated...
How Do You Grow Your Virtual Economy?<br />Get more users (peasants)<br />Convert more users to spenders (commoners)<br />...
Functional Goods drive more users to pay<br />Experiment with price points<br />Understand your user demographics and cust...
“Sales” and “Specials” drive people to spend more money<br />
Make repeat purchase experience extremely seamless<br />“Encourage” higher price points<br />Make sure the game is still e...
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Casual Connect Keynote - Creating a Bull Market: How to Manage a Successful Virtual Economy

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How to Manage a Successful Virtual Economy" given by Vikas Gupta, Social Gold CEO, at Casual Connect 2010 in Seattle.

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  • Casual Connect Keynote - Creating a Bull Market: How to Manage a Successful Virtual Economy

    1. 1. Creating a Bull Market: <br />How to Manage a Successful Virtual Economy<br />Vikas Gupta, CEO<br />SocialGold<br />July 22, 2010<br />
    2. 2. In this talk…<br />About Social Gold<br />Basics: What, Why<br />Elements of a Virtual Economy<br />Monetization<br />Growing your Virtual Economy<br />
    3. 3. Who is Social Gold?<br />The leading virtual goods monetization platform<br />Launched in Sept 2008<br />Grew 2000% in revenue in 2009<br />Founded by ex-Amazon veterans<br />In-game payments, Secure in-Flash payments<br />Introduction<br />
    4. 4. The Social Gold PlatformAll the Critical Tools to Help Manage Your Virtual Economy<br />Micropayments<br />&<br />Subscriptions<br />Virtual Currency<br />&<br />Inventory Mgmt<br />(merchandising) <br />Analytics<br />&<br />Reporting <br />PLUS:<br /><ul><li> Fraud Management
    5. 5. Customer Service
    6. 6. Fully Hosted Solution</li></li></ul><li>Social Gold Customers<br />Social Games | Casual Games | Virtual Worlds<br />
    7. 7.
    8. 8. What Exactly is a Virtual Economy?Why do people buy Virtual Goods?<br />
    9. 9. Consumer Behaviors & Habits<br />How Much do People Spend on Virtual Goods?<br />
    10. 10. Some Examples of High Spenders<br />$14,794<br />$11,635<br />$25,540<br />$13,960<br />$19,054<br />
    11. 11.
    12. 12. Virtual Goods enable much higher spending behavior in loyal users<br />
    13. 13. The evolving internet business model<br />
    14. 14. We are moving from a world of “Free” to a universe of “Paid”<br />Beauty of a Good Virtual Economy: You can “buy” without “paying”<br />
    15. 15. Elements in an Economy<br />Labor<br />People<br />Goods<br />Currency<br />
    16. 16. “Labour is the real measure of exchangeable value.<br />Wealth is power of purchasing labour.”<br /> Value in your economy is in your goods.<br /> Currency is a means, not the end.<br />
    17. 17. Virtual Currency: Means to an Experience<br />
    18. 18. Why Virtual Currency?<br />Separate “Value” from “Cost”<br />Virtual currency is “cheaper” than “money”<br />Train User Behavior<br />Economy around user generated content and time<br />
    19. 19. Building It: Who Are You?<br />What you build will vary based on who you are<br /> i.e., game, social network, publisher platform, etc <br />Platforms:<br />Are you building a currency or a prepaid stored value system?<br />
    20. 20. Robust analytics are key to managing a successful virtual economy<br />
    21. 21. Number of transactions is a good measure of the health of your economy<br />
    22. 22. Measure Sources vs Sinks<br />
    23. 23. Tools for monetizing yourVirtual Economy<br />
    24. 24. User Experience<br />Weave payments into your user experience!<br />Example:<br />Playfirst’sChocolatier powered by Social Gold’s In-Flash Payments<br />
    25. 25. User Experience<br />Example:<br />Playdom’s Poker Palace powered by Social Gold’s In-Flash Payments<br />
    26. 26. Payment Methods<br />Credit cards drive majority of the revenue<br />Mobile phones (teens/international)<br />Pre-paid cards (cash paying users)<br />Offers (incentivized leads)<br />Alternate local methods<br />
    27. 27. Subscriptions to complement Currency<br />Demonstrate Economic Value<br />Asks for more commitment from users<br />When done well, Subscriptions can complement virtual currency<br />e.g., Tagged.com, Playdom Mobsters 2<br />
    28. 28. More…<br />Inventory Management<br />Risk, Fraud control<br />Localization<br />Come by Social Gold’s deeper dive into these tools and more at 4pm today…<br />
    29. 29. Growing your Virtual Economy<br />
    30. 30. Make it a Standalone Economy<br />Go beyond “stored value”<br />e.g., Linden Dollar vsFacebook Credits<br />User generated content<br />Prices determine by users (market)<br />Trade against “real” currency<br />“Virtual” Labour creates “real” wealth<br />Both paying and non-paying users can play<br />
    31. 31. How Do You Grow Your Virtual Economy?<br />Get more users (peasants)<br />Convert more users to spenders (commoners)<br />Get spenders to spend more money (knights)<br />Serve and retain your high spenders well (kings and lords)<br />
    32. 32. Functional Goods drive more users to pay<br />Experiment with price points<br />Understand your user demographics and customize for them<br />Keep them engaged for longer<br />
    33. 33. “Sales” and “Specials” drive people to spend more money<br />
    34. 34. Make repeat purchase experience extremely seamless<br />“Encourage” higher price points<br />Make sure the game is still engaging<br />
    35. 35.
    36. 36. How many?<br />Average: 50% of all spenders  9%<br />Best Farming Game: 30%  15%<br />Worst Farming Game: 63%  4%<br />Best Social Game: 36%  51%<br />
    37. 37. Summarizing…<br />Virtual Goods power an “experience” economy<br />Engaged users can drive significant monetization through virtual goods<br />Experiment, Measure, Repeat<br />Virtual Economy has both paying and non-paying users – cater to both<br />
    38. 38. www.socialgold.net<br />Powering Virtual Economies Worldwide<br />vikas@jambool.com<br />

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