Facebook Credits Nearly Ready for Primetime

Facebook has done a remarkable job of getting developers to adopt its Credits virtual currency before the program was fully fledged. Today, the company announced a broad partnership with PlaySpan to add 20 additional ways for users to pay for credits, and the intention to triple or quadruple the number of new developers per week getting access to Credits. Credits are already used by 22 of the top 25 games, even though they can only be paid for with a few options that have a non-comprehensive international footprint: PayPal (s EBAY), select credit cards, and Zong for mobile payments.

A (very fuzzy) chart shows Digital Chocolate's increasing ARPU with Facebook Credits

Deb Liu, manager of product marketing for Facebook Credits and Games, announced the changes at the Virtual Goods Summit in San Francisco, where she invited two game developers — Arkadium and Digital Chocolate — on stage to give favorable testimonials of the increased revenue per user they’re experiencing by offering Credits as a way to pay for virtual goods. This is especially important, given Facebook takes a 30-percent cut of Credits revenue, and many game developers had already set up virtual currency alternatives before Credits were available to them.

Credits first launched in alpha in May of last year and have been rolling out with select developers since this February. The service is now up to 200 games and apps from 75 developers. The big selling point of the program is that users now have one consistent and unified place to buy virtual currency for almost all social games, which means many of them will have Credits on hand next time a game asks them to pay for something. Liu said developers across the board are seeing 5 to 10 times the number of conversion rates for players who have already bought and stored credits. She said more than half of today’s Facebook game experiences now include Facebook Credits as an option.

Jessica Rovello, president and co-founder of game maker Arkadium, told other game developers her company had learned a few ways to maximize value from selling virtual goods:

  1. Price items in credits, rather than dollars (or another real currency), because users often choose to “grind it out” to earn an item rather than pay for it with an actual currency.
  2. Familiarize users with price points before offering discounts or bundles.
  3. Introduce new items often and retire older ones; don’t offer items that don’t expire.
  4. Make sure premium items actually advance game play.

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