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Chuck I read very smart comment as well, although cannot point to the source now. It basically said that you cannot look at it as "selling fake stuff", but rat

Chuck I read very smart comment as well, although cannot point to the source now. It basically said that you cannot look at it as "selling fake stuff", but rather look as "selling something users like". This approach, I think, made Zynga (at least initially) successful where others couldnt believe you would spend money on "buying fake stuff". Same way you can say about many other things. Going to the cinema. Its fake. You can't eat the picture, you can't take it with you, you cannot even record it for later. You pay for the ticket and that ticket buys you pleasure and happiness for 90 minutes, hopefully. But other than that, 90 minutes later you have nothing. Once could say: this is fake. Therefore, people that buy "fake" pigs and harvest "fake" fields, would still pay real money for doing so, because Zynga made it look and feel so great that the result (pleasure) is worth paying real money. The true reason why Zynga is falling through cracks, I believe, is because having fake farms that you pay with real money was a fashionable moment; something cool to do, but at some point, people got tired and it stopped being popular/trendy. That's it. Now its up to Zynga to figure whether they can keep users busy some other ways (and spend money), or they won't until they get delisted from Nasdaq and subsequently file for Chapter 11. I believe in the latter.

ChuckMcM 14y ago
I use the term 'fake' here in the context of a product made entirely out of information, and your cinema example is a good one. The experience is the sale, not the asset. That said, the other company I'm watching in this space is Blizzard which recently opened up their real money 'auctions' for items in Diablo III. This legitimizes what has been an underground industry for years and recognizes that there is some business value in trading "products" made out of bits instead of materials. Unlike Zynga the Blizzard scheme has users selling to users and Blizzard just takes a percentage. If the model generates any serious revenue at all for Blizzard I would expect Zynga to follow suit, allowing Farmville users whose cow births a gold medal calf or something to trade that for Zyngian currency or even real money. These businesses have to be careful not to create an actual currency because the government will shut that down, but trading virtual goods has so far passed muster on that score.[1] That said, the analysis I've seen on Zynga games relates the pleasure not from the virtual farming, so much as the chance to get more out than you put in (the gambling rush as it is known in Las Vegas). You plant your farm and you get a golden bean or something that is now 'valuable' as opposed to all those other times you planted and got regular beans. Its a powerful tool, wielded well by Zynga and others. [1] You will know you are trouble when your customer wants to pay you with rare gear from Diablo or extra egg laying chickens or something.
- larrys 14y ago
  "I use the term 'fake' here in the context of a product made entirely out of information, and your cinema example is a good one." I understand the points being made here but using something like cinema isn't the best thing when you think about it. The reason is cinema has been around a long time. It's something that started at a different time and also you are doing it the presence of other people and it's a cultural thing. Things that are legacy are different in people's minds. So using it to either make or break an argument as to human behavior can be problematic. You could use, as an example, people's behavior with attending sporting events pointing to why people spend money to see a team win. And then why they will or will not do "x" activity. But as we all know the chance of starting a new sports league and getting the same type of attendance and devotion simply hasn't and most likely won't happen. (Professional soccer in the US is an example. It's big in the rest of the world but it doesn't make the nightly news in the US and there is very little attention payed to it relative to Football, Baseball, Ice Hockey, Basketball. And even Ice Hockey is much bigger in Canada.) So you could say "this would work because look what people do with respect to Football" or "this wouldn't work because look what people do with Football" and you are comparing something that has a huge advantage because it's so entrenched in the way we all think at this point. (And High School Football in small towns vs. big cities even bigger difference.)
- waterlesscloud 14y ago
  I enjoyed Zynga games for a while, but there was a change at some point along the line where you could no longer play the game as it was designed without spending money. That's when I stopped playing. It's fine to have the spend-money parts as fun add-ons. I might even spend a dollar or two here or there on such things. But I will not play a game that tries to hook me in for free but then requires me to purchase pieces of it just to play it as it is designed. That's a tricky line, of course. I'll play WoW sometimes, and I pay for that. But I'm not paying real money to give my character some spell that's required for basic play. For a funny hat or a cool mount (that's functionally the same as a free one), sure. Greed, for lack of a better word, killed Zynga. They pushed it too far.
  - ChuckMcM 14y ago
MattRogish 14y ago
Zynga has like $1.6B in cash/equivalents. It's gonna take a long long long time to "file for Chapter 11". (http://www.marketwatch.com/investing/stock/znga/financials/balance-sheet http://www.marketwatch.com/investing/stock/znga/financials/b...)
- sulife 14y ago
  A few more OMGPOPs and they'll get there faster!
  - hkmurakami 14y ago
    I wonder what the cash/stock ratio was for this acquisition.
  - joering2 14y ago
    I agree with you. Numbers of DS falling and it seems like even almighty Zynga cannot fix it. Shameless plug: couple months ago I built an "adult" version that got little traction but nothing significant, and since I am not a marketing wiz, but a simple programmer, it ended up here: https://flippa.com/2765466 https://flippa.com/2765466

ChuckMcM 14y ago

I use the term 'fake' here in the context of a product made entirely out of information, and your cinema example is a good one. The experience is the sale, not the asset. That said, the other company I'm watching in this space is Blizzard which recently opened up their real money 'auctions' for items in Diablo III. This legitimizes what has been an underground industry for years and recognizes that there is some business value in trading "products" made out of bits instead of materials. Unlike Zynga the Blizzard scheme has users selling to users and Blizzard just takes a percentage. If the model generates any serious revenue at all for Blizzard I would expect Zynga to follow suit, allowing Farmville users whose cow births a gold medal calf or something to trade that for Zyngian currency or even real money. These businesses have to be careful not to create an actual currency because the government will shut that down, but trading virtual goods has so far passed muster on that score.[1] That said, the analysis I've seen on Zynga games relates the pleasure not from the virtual farming, so much as the chance to get more out than you put in (the gambling rush as it is known in Las Vegas). You plant your farm and you get a golden bean or something that is now 'valuable' as opposed to all those other times you planted and got regular beans. Its a powerful tool, wielded well by Zynga and others. [1] You will know you are trouble when your customer wants to pay you with rare gear from Diablo or extra egg laying chickens or something.

larrys 14y ago
"I use the term 'fake' here in the context of a product made entirely out of information, and your cinema example is a good one." I understand the points being made here but using something like cinema isn't the best thing when you think about it. The reason is cinema has been around a long time. It's something that started at a different time and also you are doing it the presence of other people and it's a cultural thing. Things that are legacy are different in people's minds. So using it to either make or break an argument as to human behavior can be problematic. You could use, as an example, people's behavior with attending sporting events pointing to why people spend money to see a team win. And then why they will or will not do "x" activity. But as we all know the chance of starting a new sports league and getting the same type of attendance and devotion simply hasn't and most likely won't happen. (Professional soccer in the US is an example. It's big in the rest of the world but it doesn't make the nightly news in the US and there is very little attention payed to it relative to Football, Baseball, Ice Hockey, Basketball. And even Ice Hockey is much bigger in Canada.) So you could say "this would work because look what people do with respect to Football" or "this wouldn't work because look what people do with Football" and you are comparing something that has a huge advantage because it's so entrenched in the way we all think at this point. (And High School Football in small towns vs. big cities even bigger difference.)
waterlesscloud 14y ago
I enjoyed Zynga games for a while, but there was a change at some point along the line where you could no longer play the game as it was designed without spending money. That's when I stopped playing. It's fine to have the spend-money parts as fun add-ons. I might even spend a dollar or two here or there on such things. But I will not play a game that tries to hook me in for free but then requires me to purchase pieces of it just to play it as it is designed. That's a tricky line, of course. I'll play WoW sometimes, and I pay for that. But I'm not paying real money to give my character some spell that's required for basic play. For a funny hat or a cool mount (that's functionally the same as a free one), sure. Greed, for lack of a better word, killed Zynga. They pushed it too far.
- ChuckMcM 14y ago

MattRogish 14y ago

Zynga has like $1.6B in cash/equivalents. It's gonna take a long long long time to "file for Chapter 11". (http://www.marketwatch.com/investing/stock/znga/financials/balance-sheet http://www.marketwatch.com/investing/stock/znga/financials/b...)

sulife 14y ago
A few more OMGPOPs and they'll get there faster!
- hkmurakami 14y ago
  I wonder what the cash/stock ratio was for this acquisition.
- joering2 14y ago
  I agree with you. Numbers of DS falling and it seems like even almighty Zynga cannot fix it. Shameless plug: couple months ago I built an "adult" version that got little traction but nothing significant, and since I am not a marketing wiz, but a simple programmer, it ended up here: https://flippa.com/2765466 https://flippa.com/2765466