Mindless Games on the Rise

Causal Gaming is a huge opportunity for those marketers looking to reach Moms and working women — yes, we’ve discussed this before and it’s true.  These are not games for kids — they are there is give working women and Moms 5 minutes of serenity.

Now that the economy has officially sunk past the 3rd ring of the abyss all of the Casual Game sites are on fire.  In a good way.  Figure the worse things get the more people look for escape.  The numbers posted here from eMarketer tell the story.

Skittles New Home Page

There has been a lot of buzz around the Skittles campaign that started on Feb 27th.  Basically, Skittles replaced their home page with a navigation unit that links visitors to user generated content that includes the word “Skittles” on Wikipedia, Twitter, Facebook, YouTube and Flickr.  Fans of Skittles can visit the Skittles home page to see what the Soc Net universe is saying about Skittles.

The initial response to this campaign was a huge spike in traffic — Hitwise reports a 1332% increase in web visitors on March 3rd.  But the novality seems to have worn off.  Searched for the keyword “Skittles” spiked for a day then started to come back down to their average numbers.

Searches for "Skittles" over the last 12 months

The genius of this campaign is that people will now go out of their way to write something on these SocNet sites about Skittles.  Then they will go to the Skittles home page to see if what they wrote shows up.  This is GENIUS!!! They made a campaign that turns their fans into self-fulfilling celebrities for 5 seconds.  Let that sink in — if you can figure out how to do that you’ve got a successful campaign.

Thoughts:

• Skittles insights that drove this campaign must have included that their core consumer is heavily engaged in Social Networking.  That 18 to 25 target is my guess.  This doesn’t work for kids.
• They took a very bold position here — they gave their home page over to the people.  Not just fans but to anyone that posts anything about Skittles.  For better or worse.  For instance, there was a post the “Skittles causes cancer” that showed up on the Skittles home page.  For all those companies out there scared to death of what people will say about their brand take note — user generated content is not to be taken that seriously.
• The big take away is that this campaign creates a platform for fans of the brand to broadcast their fandom to each other.  In such away that makes the fan feel that they have tapped into an audience — making them a micro-celebrity for the second their post is on top of the Skittles page.
• This campaign is also a great example of the expected longevity of SocNet campaigns.  The nature of this space is that it moves fast — don’t expect these types of things to be sustainable.

This Chinese SocNet site is doing over $1B per year -- 70% of that coming from sales of virtual goods!

Since the beginning of the Internet as we know it there has been great enthusiasm for new business models followed by little business success.  So much so that many managers today roll their eyes when presented with another online money making opportunity.  Even I can be a bit cynical — but I think there is something very powerful in this new area of “Virtual Goods”.

What is a virtual  good?

Simply put, a “virtual good” is an online object that users can consume.  For example, on Facebook I can send my friend a virtual flower as a gift.  In World of Warcraft I can buy a new sword for my character.  On Stardolls I can buy new fashions for my doll.  Even Webkinz and Club Penguin operate virtual markets where the users can buy virtual goods.  These virtual goods are purchased with points earned by the user doing specific behaviors  or when the user buys virtual currency with real dollars.

Why is this important?

Real people are spending real money for virtual goods.  It is estimated that over $2B USD was spent last year on Virtual Goods. Facebook is rumored to have made $50M USD on users sending their friends virtual gifts each costing a dollar.  This is a real online business model that can be make real profit.

What is the future of virtual currency?

• Facebook will continue to develop their virtual currency business.  Look for opportunities with Facebook Connect to bring some pof that revenue through an affiliate model.
• Kid’s don’t have credit cards -  check out PayMo (link to article).  Users can pay for Virtual Goods using their cell phone number!
• Look for new opportunities around Loyalty Programs — you’re US Air points will be transferable for virtual goods.
• Look for secondary markets to emerge.  We’ve already seen this with online games where there are “gamer farms” in China where kids get paid to play video games — earn points — then the points are sold for real cash.
• Virtual Goods are also being used as an advertising medium.  I can send my friend a virtual Starbucks coffee.  That is a very engaging behavior that connects with the consumer.

Bid My Cleaning Auction Site

In the last week I’ve come across two new auction sites for professional services.  One from Sears called ServiceLive.com allows you to hire home repair services in an auction format.  The other is Bidmycleaning.com which is an auction site for home maid services.

As the unemployment numbers continue to rise over the next year I wouldn’t be surprised to see a couple other of these auction sites pop up.  It’s a great channel for self-employed or newly unemployed to easily find customers.  And for consumers to hire professionals based on an open social vetting process.  These sites allow the consumer of the service rate and review the service.  Another powerful example of how social networking and reviews are driving confidence in the buying decision.

As an Internet Marketer think about how this trend may develop in the future.  They will be marketing opportunities provided through these auction sites.  Whether it is email list, display advertising, or cost per activity.  This will be an interesting trend to follow,

eMarketer User Generated Content by Type

According to Accustream (link):

Demand for professionally produced and distributed online video continued unabated in 2008, with cumulative volume advancing 24.3% to 41.6 billion views.

According to eMarketer User Generated Content (UGC) is also growing significantly.  eMarketer (link) They are predicting that there will be over 27MM amateur creators of video content by 2013.

My first Internet Marketing job was with a “dot com” that was a platform for user generated content.  Even back then there was this debate over if one type of content,  professional over amateur, would win out.  The data presented here paints a more realistic picture that both will flourish.

HOWEVER, Pro content will get the ad revenue.  I know, I know — we’ll keep trying to monetize USG.  But it will never happen.  YouTube will only start making money when they get serious about pro content — or lose out to Hulu.  If we never can monetize amateur content than what’s the future of amateur content?  I don’t know.  We’ll always have it — but I’m hard pressed for an answer on how to deliver revenue from it.