Facebook is testing virtual gifts – small icons that you can give to other Facebook members to be displayed on their pages in the “wall” section as well as a new gift area. The test is running with members from just a couple of select schools at this time.
The gifts icons were designed by Susan Kare, the designer of the original Mac icons. Gifts can be sent publicly or privately (public gifts will show everyone the name of the giver, private gifts only show the icon). Each virtual gift costs $1, although right now they are free.
In a brilliant marketing move to kick this off, Facebook is donating the February net proceeds from the virtual gifts to charity. After that, they’re keeping the money. I would expect this to be a significant revenue generator for them by year-end.
The reason I say this is because “poking” is already such a big activity on Facebook, where you reach out to other users. When you pay money to do the same thing, it will mean more, and people will be sucked into doing it. If and when Facebook launches premium gifts, people will be buying those, too. I’d also expect them to sell really high end “limited edition” icons as well in limited supplies.
I don’t really see this idea taking off, but I could be way off
“I would expect this to be a significant revenue generator for them by year-end.”
Doubtful… February will work as they donate to charity, but after that it’s pretty pointless. The icons are a little too cute to be interesting, and really valueless.
FunHi did this a long time ago. They made a lot of money from it, but I don’t know how it worked out longterm. http://www.wire...1,62826,00.html
I have to pay more and more taxes each year, but that doesn’t mean I like giving away money.
the whole virtual gift via icons idea seems tacky, at least in relation to facebook’s model – i just don’t see it
now if that idea was applied to a more appropriate site – say myspace, then i would be more able to digest the concept
Consumating.com has also been doing this for a few weeks now with their “Toy Box” feature (which I believe also allows you to create your own pixelated gifts from scratch)…
Seems like the social networks are beginning to dip their toes into the SecondLife/CyWorld virtual goods space. Inevitable… But will it stick?
Seems liek virtual things, cities and gifts are getting popular.SO they wil becoem a source of money for even the users
I’ve tested the Second Life virtual world before they hit their 1 Million residents mark few months ago. Giving away items (icons) is a great concept in that world. People pay virtual dollars and buy items for each other. I agree with Mike on this. I believe this will be a good income generator for FaceBook.
I think if any of my friends knew I paid $1 to post a puppy icon on a friend’s facebook profile, they would quit talking to me… that seems really creepy.
I really do not see this flying. Initially, maybe just due to the hype. But after a while, I don’t think so. Mainly because they will be charging. Sure it’s only $1 but for a young target audience like that, don’t bother. College students love the word “free”!
Tacky? Whose to say but the intended audience. FB has nothing to lose by doing this. As far as the cost – $1 is right at the range where it’s still an impulse buy. I know plenty of college students who never bought a single course book but always stopped for a latte on the way to class, or had huge DVD collections.
Personally I wish I’d have thought of it. That and million dollar homepage.
Who buys money for that junk? I feel sorry for anyone who wastes their money on such futile nonsense. I’d rather get any of those icons in real life! Harsh, but can’t you do the same thing over MSN for free? Granted, I’m not aware of any of the sites that were successful in selling the icons mentioned above. As a Facebook user myself, from back in the day when it was a university-based social network, I find it hard to believe that the “starving student” would fork out cash/their credit card for little icons.
But, who knows.
How stupid….anyway, this isnt a new idea , but since its facebook it will probably be profitable. Xuqa.com, their competitor has been doing this since day one.
Im surprised no one is saying “copycat”, oh but this isnt a digg-like idea.
just in time for valentines day. but if I was a chick, i’d expect something real. Though college girls are easy.
Facebook just doesn’t know what to do with itself. This is easily the gayest thing I’ve ever seen.
#11, what do they have to lose? How about credibility? Facebook is supposedly known for great ideas and this is the best they could come up with? Pretty sad. “Gifts” works in a virtual world like Second Life, but not in a Facebook setting where people don’t have virtual cars, dogs and girlfriends.
This silly thing may be intriguing if you are like 13 yrs old, but other than that I don’t see the allure. Some kids will try it, but when you pay $1 to send someone a roll of toilet paper, and don’t get a gift back, I don’t see it continuing much longer.
Facebook may make enough money off this new thing to pay their rent for 2007 but that’s about it.
If my facebook friends want to all chip in $1 to help pay my AMEX card from last month, I’m all ears.
Too many people with closed minds.
I’ll admit that I thought the idea wasn’t the best, but after reading Mike’s thoughts in the post, I can see this working. You have to remember the demographic – late teens and twenty-somethings. I fall within that demographic and could envision several of my friends using it to drop girls a “hint”, or to send to their current affair.
I suspect that the commenters here on TC don’t fit that demographic. It’s hard to make an assumption on something that doesn’t even apply to you.
Definetly can see this being a big hit for Facebook – and they need something to distinguish themselves from the crowd.
I agree that this might be the next big thing in Facebook.
Money isn’t everything. In this case, my guess is that people will buy after taking into consideration that the $1 paid can actually bring back fun, happiness and friendship.
money IS everything when you turn down a billion dollar offer buyout! You have to show those VC’s why you passed on all that money. Is $1 toilet paper rolls the answer? I say no.
Tacky or not, any dollar made from this idea is a dollar more in revenue.
I can see girlfriends buying boyfriends and vice versa icons for valentine’s day and beyond.
I don’t think they will be bringing money to the bank by the truckload, but maybe a geo metro-load.
This might be just my own opinion, but $1 generated from many users certainly equals more than $0, no?
cg is right – money does matter. That’s why any attempt at monetization is a good thing. Am I reading you right, cg?
While this may not make boatloads of cash, it’ll certainly make *some* money. And, given that the costs of implementing this virtual gift system are next to nil, the profit margins basically become the revenue generated.
However, it does seem like a tacky idea… but who knows? Facebook is open to the general public, and sometimes people will dole out cash for stuff that may seem meaningless. As long as they don’t inundate the site with too many cash-grabbers, it won’t have a negative effect.
I really don’t see the Facebook audience jumping at this idea immediately. I think the mainstream Facebook audience is too “cool” for virtual goods.
It’s going to be difficult to monetize by getting money from users.
A big key will be how easy they make the transaction. Frankly, the $1 price tag won”t hold as many folks back as a draggy checkout system.
Facebook really needs an ingenius payment interface where students hardly even see this as a purchase. I’m guessing that is what they’ll work on in the period this thing is free.
-Zaid
Im selling icons for 50¢ – you can place them on your blog, facebook page, myspace page…whatever…All of my icons are 100% free-range, steroid free icons. Email me for bulk discounts.
you saw how bent out of shape people got over the news feeds privacy issue, now you are expecting several million people to put their credit card info on file? So I think we all agree most 22+ folks won’t jump on this gift idea. And how about the High Schoolers? Are their parents going to let them use mom’s credit card so they can buy random shit for $1 on Facebook? Don’t know. So that leaves a very small group of potential customers.
What you don’t understand Robert Dewey is the (for lack of better word) “opportunity loss” from a $1 icon program that totally bombs. How receptive will Facebook users be to their NEXT idea if this one is a dud? The answer is not very (even if their next idea is a really good one). Is it worth risking making a few hundred grand with this thing to potentially damage future user generated revenues?????
“The reason I say this is because “poking” is already such a big activity on Facebook”
Mike. I don’t think this is true. Where did you get this information? From my use of Facebook (target demo and all), no one pokes.
1. If my bf bought me a virtual gift for V-day, I’d probably donate all of his old transformers to charity or perhaps put them in a blender
2. Users can already “give” icons to other users for free on Myspace so why would I want to pay on Facebook?
3. Props to Facebook for trying though. It’ll be interesting to see how it turns out
it worked in korea, but around here it’s almost ridiculous to ask someone to pay for icons.
Facebook isn’t cyworld and won’t be anytime soon until there is a big US culture shift. Try, Facebook, Try. Monetize as fast as you can, I don’t think it’ll be fast enough.
cg;
You’re assuming it “totally bombs”… I’m assuming the opposite. This is an opinionated subject with no right answer. It’s not that I don’t understand, it’s that I have my own separate opinion.
Brilliant. Current valuation of Facebook has just jumped to at least $25 billion. A few more things like this and they’ll hit the $100 billion mark.
If this succeeds and everyone ends up with same the gifts, the same widgets, the same boring everything, it doesn’t say much for the internet empowering people.
Anyone else want to play THE FACEBOOK MONETIZATION GAME with me?
Rules: Think up as many arbitrary ways of prying micropayments from your users as possible.
1) Facebook Ringtones! 99c
….your suggestions please…
“1. If my bf bought me a virtual gift for V-day, I’d probably donate all of his old transformers to charity or perhaps put them in a blender
”
Wow. Those are some strong words. Apparently Facebook didn’t poll the “Will It Blend?” demographic before putting this feature out.
This seems like a fairly direct nod to LiveJournal’s v-gifts feature which launched a year ago. Facebook has made smart use of (and improvements to!) LiveJournal’s open source scaling platform, there’s no reason they wouldn’t be inspired in this area as well.
Virtual world , virtual lives, virtual gifts, how about virtual private secretaries and spouses for a change?
http://www.tekn...ld.blogspot.com
What I find most interesting, is that this will changes the dynamic on facebook quite significantly and create a competitive vibe amongst users. Before – everyone’s profile pages were essentially the same visually. Now, they won’t be, and this will be more pronounced amongst girls. I read somewhere that 70% of fb traffic was from females, so perhaps that’s a good thing for them.
I wonder how it will be presented (only on the wall, or as a separate category on the profile too?). If it’s on the wall, then maybe that’s not a big deal, it’s just glorified wall posting.
Anyhow, I think this will work, and will provide facebook with a decent revenue stream. I think it’s a cleaner and more efficient way to make money than a lot of the other possibilities they have.
I don’t understand… why the hell would anyone pay for a picture of a teddy bear, especially one they could already see for free???
There’s a similar feature on http://www.univillage.com called … “Carli* Says” (edit as required!) and users can pick from a number of greetings to post, for free, on friend’s pages.
This is retarded. So it can be successful.
You could see this sort of thing working as a costly-signaling method. You wouldn’t spend $4 on a Reservoir Dogs badge unless you wanted people to know you liked it. Me and a friend thought about doing this with a mobile phone avatars. (Your avtar will chat with other avtars over bluetooth – social software, smart mobs, yada yada ya da … ) It would give user’s avtars some identity, and stop them mutating constantly to match the interests of the ones around them.
The presents that Facebook offer are not distinctive enough to encourage that behaviour. The real-estate on your homepage has a natural “cost”, so it can be a costly signaling mechanism. Besides, why not buy someone something from their Amazon wish list?
Still, if cyworld made is work… S.Korea is 2-5 years ahead of US/UK. I’m not convinced that the culture gap would stop it working here: human nature is pretty universal.
I’m sure this will be hugely successful. There is a similar system on an existing social network site (www.parano.be) which is used by many French-speaking young people all over the world. Visitors accrue virtual currency according to the amount of time they are logged into the site. You exchange gifts with other users on the site. It’s a kind of social currency to facilitate building relationships and friendships with others on the platform.
Won’t it be funny if people send private I love you gifts to members they don’t know that display on the page… making real boyfriends/girlfriends jealous. Could see more killer for hire cases like the mySpace one a while back!
For the facebook users opposed to paying for virtual gifts, go ahead and join the group:
http://www.face...?gid=2234798060
test
I don’t know what “poking” is, but I can think of two reasons why this may work.
If the “wall” is visible, then displaying your gifts denotes status. People can then decide whether to be ostentatious or demure in displaying their gifts. In that sense, I think the options on the screenshot are wrong. The recipient should decide what, where and how long to display those gifts.
Secondly (warning: possibly pretentious): Token gift-giving is a required part of socializing in many situations. This could test whether that norm would transfer to online social networks. You can already trade favors (links?) which is akin to bartering. These gifts could be more like, but not as crass as, currency — more efficient.
i think someone here nailed it. “it’s stupid enough to work”
WTF?