When will you be spending Facebook credits?
When my brother Jeffrey and I wrote "Waiting for Your Cat to Bark?" we explained how in the evolution of sales and marketing history, the trend towards the reduction of friction for the customer is impacted by three factors: transportation, communications, and payment technologies. In my last column, while describing the Future Shopper, I illustrated one of the trends; how communication technology will affect the way that people buy.
The other two facets of change are concurrent evolutions in transportation systems (i.e., superb logistics and virtual delivery) and payment systems (security, alternate currencies, and micro-payments). This past week at the Shop.org conference in Dallas, I caught up with Scott Silverman, the former director of the association who recently left to co-found IfeelGoods.com. It's a fascinating move but this company truly has the potential to change the way payments are made using Facebook credits.
The impact on reach and traffic patterns that Facebook and its Like button plug-ins have had are evident. The facts that Target is beginning to sell Facebook credits in-store and how quickly the social gaming world is growing show that we are on the verge of seeing a wider adoption and use of these credits. If enough people begin to accept and use a currency because it represents stored value to them then it can become universally accepted. This is not unrealistic, as TechCrunch recently wrote how Facebook can become bigger than Google:
If PayPal's 2009 revenue was $2.8 billion with 87 million active accounts, it's not a stretch to predict that five years from now Facebook too will have 100 million to 150 million active Credits accounts (at least!) bringing in $5 billion in revenue from this business unit alone.
Many in the industry have been waiting to see if anyone would solve the micro-payment issue and Ifeelgoods.com is one solution that would easily integrate into retailers websites to offer Facebook credits for incentivizing positive actions, thus providing a viable micro-payment option.
We might offer our customers some virtual goods, such as a tractor for FarmVille or a machine gun for Mafia Wars as the virtual goods market is exploding to prompt them to take action. According to The New York Times:
The Inside Network, a research firm that tracks social media trends, said Tuesday that the market for virtual goods in the United States was expected to grow to $2.1 billion in 2011, up from $1.6 billion in 2010.
Facebook has been pushing all its game developers to use its credits system as the virtual currency of choice, as it gets 30 percent of all transactions processed with credits.
With over 500 million users globally and with 42 percent of them actively using social gaming, which will make them comfortable trading Facebook credits, will it be long before we see it as another payment option that we are offered as consumers?
In fact, my good friend and CEO of ClickEquations, Lucinda Holt just returned from a trip to China where she describes how we should possibly look to e-commerce trends there because they may become popular here in the U.S. Lucinda shares:
"Because of the enormous difference in China - in culture, payment and delivery infrastructure, Internet penetration and maturity, and many other attributes - the Internet is developing very differently there than it has in the U.S. Things that we assume here just aren't true there. For example, search isn't the universal onramp to the Internet. Social commerce is much older and entrenched. Gaming leads in online activity and spending. And payments aren't dominated by credit cards; services like Alipay and Tenpay are pushing beyond micro-payments in games to become standard payment mechanisms for ecommerce transactions."
Are you accepting or using Facebook credits yet? Are your customers? What impact will the wide acceptance of Facebook credits have on your business?
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Bryan Eisenberg is co-founder and chief marketing officer (CMO) of IdealSpot. He is co-author of the Wall Street Journal, Amazon, BusinessWeek, and New York Times best-selling books Call to Action, Waiting For Your Cat to Bark?, and Always Be Testing, and Buyer Legends. Bryan is a keynote speaker and has keynoted conferences globally such as Gultaggen, Shop.org, Direct Marketing Association, MarketingSherpa, Econsultancy, Webcom, the Canadian Marketing Association, and others for the past 10 years. Bryan was named a winner of the Marketing Edge's Rising Stars Awards, recognized by eConsultancy members as one of the top 10 User Experience Gurus, selected as one of the inaugural iMedia Top 25 Marketers, and has been recognized as most influential in PPC, Social Selling, OmniChannel Retail. Bryan serves as an advisory board member of several venture capital backed companies such as Sightly, UserTesting, Monetate, ChatID, Nomi, and BazaarVoice. He works with his co-author and brother Jeffrey Eisenberg. You can find them at BryanEisenberg.com.
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