DISQUS

Good article, thanks Barak! Social network monetization is certainly still in the early stages, but there is one solution you did not mention that is quickly gaining traction: virtual currency monetization. You say "On social networks, people are primarily concerned with communicating with their friends, not looking to buy items or services," but the whole idea behind virtual currency is that people ARE willing to buy items or services that contribute to their communications with friends.

http://myofferpal.wordpress.com/2007/12/07/a-ne...

I agree, Eric -- I don't get the negativity either. RockYou is a top notch company in a thriving space. This announcement should be hailed as good news that at least part of our economy is still healthy.

Millions of people now spend more time with social networks and social apps than they do with their televisions. Many big-name advertisers are starting to notice, too.

http://myofferpal.wordpress.com/2008/11/03/rock...

Hilarious. He's so amped up I half expected him to get up a do a cartwheel at the end. Either that or put his head down and take a nap.

Matt here from Offerpal -- in Nick's defense, app developers can be a very secretive bunch and don't want others catching on to what works and what doesn't work for fear of getting copied. If Nick were to spill the beans he would lose his credibility from the source and would never get an inside scoop again.

That said, I can definitely confirm that there is at least one app making $1 million a month. In fact there is more than one. Of course, I'm bound by confidentiality agreements not to share who exactly, but I can say that across our entire network our publishers are making on average $75 per day for every 1,000 DAUs. With enough users, and with a highly engaging app, $1 million a month is definitely attainable.

Those who choose not to believe this fact will find out soon enough. The market for advertising on social apps is big and getting bigger. And we here at Offerpal feel we've got the secret sauce of embedded offers, high targeting capabilities and powerful revenue optimization. Give us a shot and find out for yourself.

Good overview, thanks Paul. You might notice that many of the networks you've mentioned are simply trying to fit old ad models (i.e. banners) into this very new medium. Offerpal Media, on the other hand, uses an entirely new and different advertising platform, one ideally suited to the social environment. Our use of a virtual currency platform is the difference between interruptive advertising and engagement marketing. So far we've experienced tremendous growth and success with it, and that's why we feel we're positioned to succeed in the long run.

Nick -- i think you're on to something about virtual currencies and rewards programs (and not just b/c my company happens to be one of the players in that space). These systems are embedded into the user experience directly, so the ads have much more relevance to the consumer than interruptive ads such as the typical banners that other networks are running. Granted, not all apps are amenable to virtual currencies, but for those that are, the conversions and revenues are certainly impressive.

But overall, I'd put the size of the revenue possibilities as at least twice the $10 million that was quoted, and that number will only grow. What do you think?

Say it ain't so, Nick! Granted, all those apps can be a waste of time at times, and it is extremely difficult to maintain the excitement that occured when they first sprang (sprung?) on the scene, but if a pundit like you can't even maintain his excitement, how can any of us?

But, ok, I see your point. While I do find several apps a great way to keep in touch with friends (Owned!) or feel like I'm actually making a difference in the world (Lil Green Patch), I'll admit that 90% of the apps I've downloaded over the last year go completely unused.

Thanks for the perspective.

Cheers,
Matt