According to research from eMarketer, that Farmville or Mafia Wars game you’ve become addicted to on Facebook is part of an industry that will soon be worth $1 billion. With 62 million U.S. Internet users (or 27% of total users in the States) playing at least one game on a social network per month, advertisers are spending gobs of money hoping to cash in on all those eyeballs; while users are increasingly parting with their money to buy virtual goods like “ammunition”, “crops”, and “new levels” as they dive deeper into their gaming habit. What’s more, companies are spending their money on “lead generation” campaigns – or the exchange of you signing up for their newsletter or special offer in exchange for free virtual goods for your favorite game – with the hopes of enticing you to sample or test their products.
Users are expected to spend $653 million in virtual goods in 2011, 28% more than last year with $248 million coming from lead generation and $192 million from advertising. eMarketer says virtual goods will continue to lead the way in generating revenue for the industry with a 60% share in 2011 and 2012.
Rajan is the founder and Editor-in-Chief of BIG Marketing for Small Business. He's an award-winning marketing strategist who is passionate about branding, digital marketing and social media. He spent nearly a decade as the marketing executive at global IT firm Peer 1 Hosting and was instrumental in their explosive growth.