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How Brands Helped Zynga Get to IPO Chatter

  |  May 27, 2011   |  Comments

In-game campaign spending ranges from $100,000 to $1 million.

As Mafia Wars became one of the public's favorite ways of passing time online back in 2009, industry watchers began assessing how the Facebook game's creator, Zynga, might monetize those millions of eyeballs. And then sister Facebook game FarmVille took off to the tune of more than 80 million users, and of course, brands have been increasingly drawn to Zynga as an ad platform.

farmersfarmvilleWith Zynga IPO chatter on the rise, it's time for a look at the brand marketers that have helped the San Francisco-based company get to this stage. To be clear, the majority of its revenue comes from micro-transactions charged to players for items like poker chips.

At the same time, according to SocialVibe, a Zynga engagement advertising partner, in-game ad budgets are growing - per-campaign spending now ranges anywhere from $100,000 to $1 million. In the last year, brand marketers utilizing Zynga have included Coca-Cola, Sprint, Amex, Lexus, Timberland, McDonald's, Farmers Insurance, Xbox, and Paramount Pictures.

Paramount recently launched a campaign that offered an in-game item for Zynga's CityVille to promote the animated feature Kung Fu Panda 2, which opened May 26. The game has more than 89 million monthly users, according to AppData.

And in an unusually good example of how companies have integrated their name into a game experience, Farmers Insurance orchestrated a 10-day campaign in October on FarmVille. The provider of auto, home, and life insurance offered players game access to a Farmers-branded zeppelin-styled airship. The blimp hovered over players' crops and worked to prevent withering - an actual result of crop neglect in the game's universe.

The goal was to attach Farmers to the idea of protection in a fun, hip way, Marc Zeitlin, VP ebusiness for Farmers, told ClickZ at the time. "We're helping people in FarmVille protect their virtual crops with virtual insurance," he said.

SocialVibe has run numerous branding campaigns for names like Kia Soul and Bing. It employs 750X500-pixeled ad units that are launched from promo placements directly below the main gaming window and hover above the game without taking the viewer to another page. Other Zynga advertising providers offer smaller wall placements, where players are encouraged to sign up for contests or purchase items to earn game currency. Some brands, like the aforementioned Farmers, become interwoven into the game narrative akin to product placement.

Fourteen months ago, SocialVibe worked with digital agency Deep Focus to create an in-game offer of virtual currency for FarmVille players. Players who engaged with the brand and were given the opportunity to go on to become 'fans" (or "likes" in the current parlance) of Bing, which tripled its audience on the social site in a single day. In all, 300,000 Facebook users were lured to "fan" Bing on March 2, 2010.

Jay Samit, CEO of SocialVibe, said he's run CPG campaigns on Zynga games that average more than 3 minutes time spent per user, while his automotive clients garner 30 percent share rates. He also boasted that entertainment brands have told him that Zynga ads outperformed regular online display efforts by 9X.

Samit said, "In-game product placement provides a brand with excellent reach, whereas a SocialVibe engagement on Zynga provides a consumer [with a] totally focused attention on the brand and its core messaging. And since the consumer is playing within Facebook, it makes sharing the advertisement that much easier. In fact, most of our campaigns show a double digit share rate."

Perhaps his comments help explain why Zynga's current valuation is between $7 billion and $10 billion. The social games company, which was launched in 2007, didn't respond to information requests for this story.

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ABOUT THE AUTHOR

Christopher Heine

Christopher Heine was a senior writer for ClickZ through June 2012. He covered social media, sports/entertainment marketing, retail, and more. Heine's work has also appeared via Mashable, Brandweek, DM News, MarketingSherpa, and other tech- and ad-centric publications. USA Today, Bloomberg Radio, and The Los Angeles Times have cited him as an expert journalist.

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