The Latest News on the Social Games Market in Europe and Emerging Markets


Social Networking Platforms in Germany

By Gary Merrett

While Facebook has already become a social networking quasi-monopolist in many countries around the world, the German social network landscape remains pretty diverse. This may change in the near future, however, as new figures released by a leading German social media marketing agency, Compass Heading, suggest.


While Facebook continues its rapid growth in Germany, most other social networking platforms are stagnating or shrinking. Facebook has consistently been able to increase its user numbers by 10-20% monthly and this trend looks to continue, given that comparable countries such as France have twice as many Facebook users. Industry observers expect around 20 Million Facebook users in Germany by the end of 2010.

The second largest social networking platform in Germany by far is (“who knows who”) which is especially strong in the southwest of Germany and is gradually expanding to other areas. It has seen growth rates of 10% over the last few months but declining pageviews may be a signal that wer-kennt-wen is about to reach its limit. Wer-kennt-wen appeals mainly to the non-academic milieus, which may help them its keep users away from Facebook, which is heavily dominated by students and university graduates.

Germany´s joint third largest social networking platform,, also seems to have hit a maximum and will have to fight hard to keep its 5.6 million users in the face of dwindling page views and active users. SchuelerVZ, Germany´s social networking platoform for secondary and high school students, also has 5.6 million registered users and has been able to keep this figure stable.

In fifth position student-focused, formerly Germany´s undisputed leader of social networking platforms, is struggling to stop its users from switching to Facebook but are currently losing the battle: In just one month, From December 2009 to January 2010, StudiVZ lost 10% of its users and saw pageviews plunge by 30%. StudiVZ´s CEO, Markus Berger-de-Leon, recently announced his departure from StudiVZ, raising even more questions about the future of StudiVZ.

Its sister platform, (targeting the general public as opposed to just students) as well as each had 3.8 million users in January but both platforms have had to endure a slow but steady decline in user numbers for several months, although Myspace´s worldwide pageviews went up.

The only platform besides Facebook whose prospects look promising in Germany is which connects professionals and business people. User numbers grew by 10% from December 2009 to January 2010 which means that it now has an all-time high of 3 million users. Given that is stagnating at around 800.000 users, looks set to become the dominant social networking platform in Germany for professionals.


Retailers’ Disappointing Presence on Facebook

By Sebastian Sujka

Despite Facebook’s tremendous growth and the attention it is given by the media, only a surprisingly small fraction of online retailers has a professional presence on this social media platform. According to a recent study by ForeSee Results, only 25% of the top 100 online retailers have a well designed Facebook presence. Another 25% have pages with less then 10.000 fans. These numbers are astonishingly low, considering over 400 million active Facebook users. The study also reveales that over 50% of internet users who buy goods online are on Facebook and that users who interact with retailers over Facebook do this to get information about special offers (49%) or product details (45%).

This data raises the question why relatively few retailers use this social media marketing channel. Facebook is the fourth largest website in the world and creating a fan page is free of charge. The most obvious reason is simply lack of knowledge – many companies seem not to have realized what a powerful marketing tool Facebook can be.

The fan function can be used by employees to demonstrate identification with the employer, by brand partners and most importantly by satisfied customers. The user can become a fan without being urged to. Once a fan, the brand of choice is part of his familiar social network and will be displayed to all friends. Hence, a Facebook site has an enourmous viral potential to gain lots of fans if interesting content or offers are presented. Starbucks, for example, raised 5.7 million fans with deals like “Become a fan to get a free coffee at your local Starbucks”. Fans can be „aquired“ within the platform or from the official homepage using Facebook connect. Even for small companies a corporate site can be interesting because it can serve as an entry to social media marketing and communication with customers. It should also be kept in mind that a lot of fans can generate a lot of traffic, but even smaller amounts of fans are interesting as Facebook corporate sites generally are indicized very high by search engines.

Social Media marketing can be very powerful and retailers should not only focus on Facebook. According to ForeSee Results’ study that 56% of online shoppers who „follow“, „friend“ or „subscribe“ to a retailers presence on Facebook, Twitter and YouTube. Other shoppers interact with retailers on MySpace (15%) or LinkedIn (8%).


New Study on Social Gamers in UK and US

By Thorsten Bleich

PopCap, the Seattle-based casual game developer behind the “Bejeweled” series, today presented a study on US and UK consumers who play games on social networking platforms finding that, contrary to popular belief, the average social gamer is a 43-year old female.

According to the study, almost 24% of the 5000 survey respondents play social games at least once a week, indicating that the social games market in the US and the UK has grown to a total of almost 100 million popcap logoconsumers. 55% of social gamers are female while 45% are male and the average age is 43. It is notable that US social gamers tend to be older than their British counterparts, with an average age of 48 (38 in Britain) and 46% of American social gamers being 50 or older while only 23% of social gamers in the UK belong to that age group. In the US and the UK combined, only 6% of all social gamers are age 21 or younger.

The survey also found differences in the consumption of and attitudes towards social games between men and women. More women than men play social games several times a day (38% vs. 29%), and women are more apt to play social games with real-world friends than men are (68% vs. 56%) whereas men are more inclined than women to play with strangers (41% vs. 33%). Also, women are much more likely to play with relatives than men (46% vs. 29%).

The survey also provides evidence for the growth of social games. More than half (56%) of social gamers have been playing social games for more than a year but about one quarter (26%) only started playing social games withing the last 6 months. About a third (35%) of social gamers say their consumption of social games has increased over the past three months, compared to 10% who said it has decreased.

“This study establishes social games as a fast-growing and quickly maturing pastime for an enormous portion of the population,” noted Robin Boyar, founder and principal at Thinktank Research, a market research consultancy specializing in gaming and the digital consumer.

And these social gamers are playing with great intensity. Almost all social gamers (95%) play multiple times per week and nearly two-thirds (64%) play at least once a day, suggesting that social games truly do get you hooked, though this is more true for U.S. players (68% are daily players) than for U.K.- based social gamers (55%). Social gamers´ most popular games for weekly or more frequent play are Farmville (69% of all social gamers who play Farmville say they play once a week or more), Bejeweled  Blitz (65%), Texas Hold’em Poker (63%), Cafe World (61%) and Mafia Wars (59%).

plantsThe survey also revealed the main reasons for playing social games. Most social gamers cited “fun and excitement” as their main motivation (53%). Stress relief (45%) and “competitive spirit” (43%) were next most popular respectively, followed by “mental workout” (32%) and “connect with others” (24%). Interestingly, only 17% of UK-based social gamers chose “connect with others” as a reason for playing, compared to 28% of their U.S. counterparts.

As for the social networks that users choose to play social games, attracting 83% of social gamers Facebook by far leads the pack compared to 24% who play on MySpace, 7% on Bebo and 5% who play on Friendster. Given that 49% of social gamers log into social networks specifically to play social games and that social gamers on average spend 39% of all their time on social networks playing games, social games have become a major source of traffic for social networks. As Boyar puts it,”With more than 80% of social gamers stating that playing social games strengthens their relationship with friends, family and colleagues, social gaming reinforces the core appeal of social networks.”

According to the survey, word-of-mouth is the most common way that social gamers hear about new social games. 57% of social gamers rely on a recommendation or in-game alert from a friend while 38% said they learn about new games from ads on social networking sites and 27% cited standard web searches as a source of information on new social games. Social gamers have played an average of 6.1 different social games; 39% have played between three and five social games and 13% say they’ve played more than 10.

Finally, the study revealed that 53% of of social gamers say they’ve earned and/or spent virtual currency in a social game, but only 28% have purchased virtual currency with real-world money and only 32% have purchased a virtual gift. Nearly a third (32%) of social gamers say they’re likely to purchase virtual items with real-world currency. A quarter of social gamers say they’ve been misled by an ad or other “special offer” tied to a social game they’ve played.

More detailed survey results and the survey´s methodology are available at


Mopay expands to the U.S.

By Thorsten Bleich

Mopay, a leading provider of worldwide mobile payment solutions, today announced its expansion into the U.S. Mopay specializes in providing people without bank accounts or credit cards with the option to purchase digital goods and services by placing charges on their mobile phone bills. This move will enable North American social network and gaming providers to create a new revenue channel. U.S. consumers will be given the opportunity to purchase virtual goods and other digital content with their mobile phones. This option is particularly interesting for young people who often do not own a credit card or bank account. The headquarter of mopay’s U.S. offices will be located in Palo Alto, California.Mopay

Serving a customer base of 500 million users worldwide and being able to reach more than 3.3 billion people with SMS-enabled mobile phones in 65 countries, mopay enters the U.S. market to challenge providers like BOKU and Zong.

Major publishers already being served by Mopay include heavyweights like Bigpoint, Gameforge and Innogames. “The U.S. market is ripe for change and primed for growth in the mobile payment market,” said Mr. Reiss. “European providers have been ahead of the mobile payment curve for a number of years, successfully embracing the full potential of how easy it is to pay for goods and services via mobile.“

It will be interesting to see whether European mobile payment providers will change the payment habits of US gamers. The mobile payment market in the U.S. is less developed than in Asia or Europe, partly due to U.S. residents´ high affinity to credit cards. But given the growing popularity of virtual goods in social games, mobile payment looks set to become a real alternative to traditional forms of micropayment.


The Seven Sins of Social Games

By Sebastian Sujka

Social game developers around the world ponder about the same questions: Firstly, how to develop a game that will attract the masses? And secondly, how to achieve optimal monetization?

One aspect to consider is the genre of the game. There is a hierarchy of which types of games can be monetized best in terms of average revenue per user (ARPU). It is hardly surprising that  at the top of the list we find gambling. Social RPGs come second, closely followed by recourse management games and simulations. Caretaking games and minigames generate the lowest ARPU. This hierarchy on its own, however, does not yet tell us how to construct a successful social game. To illustrate this point, caretaking games are not designed to have a high ARPU but monetize well nonetheless due to their long product life cycle.

Different types of games have different approaches as to how the game can be monetized best. At this months Casual Connect in Hamburg, Rex Ng from 6waves presented what he calls „The Seven Sins of Social Games“ that reflect  the different ways in which social games get users to play and pay. His classification sheds light on why social games are so successful: they appeal to basic human impulses:

The human desire to show off can be very useful. In the context of social games it is particularly interesting because a lot of games allow your friends to see your belongings, accomplishments or current aquisitions.

Just like your friends see your belongings, you see theirs. Envy can drive the user to achieve the same status by earning more credits or buying them. A very interesting way in which envy can be employed is by allowing  you to steal friends´ possessions such as stealing your neigbours’ crops on Farmville.

The desire to consume ever more is very interesing for monetization, especially for item selling. One attractive option is to release new items frequently in order to devaluate the already aquired items and to create  a fresh desire for new ones.

Users crave for instant gratification. Gameplay must be designed in a way to make this possible. The average social gaming session is just a couple of minutes. If a user can achieve gratification quickly it is more fun to play and retention rates will be increased as a result.

Players want to compete with other players. Or even fight them. Unless you are targeting women, who typically prefer collaborative games, it is  it makes a lot sense to encourage and incite wrath in a social game. If groups cluster and mobilize against each other both need to stock up to win. Zynga’s Mafia Wars demonstrates this impressively.

Users playing social games desire virtual wealth. They will fight for it, work for it or buy it – but only if the game allows them to. Frequent update and expansion possibilities are a good way of  triggering gamers´ greed.

The desire to avoid spending time and effort on something works in the same way as  the previously mentioned sins. Sloth cannot be used directly for monetization, but it can help to bind users and to increase the product life cycle. A great example is the cleaning fish feature in aquarium games: if you cannot be bothered to clean your aquarium daily, in some games you can get a cleaning fish to do it for you.

A successful social game will always be build on some of these aspects. Social games are very different  from other games – they are based on human interaction. Hence, it is crucial for every developer to understand what drives the social user to play – and to spend money.


Interview with Jan Beckers of SponsorPay

By Gary Merrett

Social Games Observer: Earlier this week, SponsorPay announced it had taken over GratisPay. What were the main reasons for the acquisition?

Jan Beckers: In the past year or so, both Sponsorpay and GratisPay have been able to build a strong customer base in Europe, including some of the largest publishers. We knew that together we would be in a great position to become the dominant offer provider in Europe by taking advantage of synergy effects such as being able to share our offers. This will give the user more choice which in turn will increase revenues for publishers.

SGO: Why did SponsorPay decide to keep both brands?

JB: Besides the fact that SponsorPay and GratisPay are positioned differently on the market, one of the main reasons for maintaining both brands was that it was important to us that the transition happens as smoothely as possible. SponsorPay and GratisPay have established themselves on the European market as reliable monetization partners so it makes sense to keep both brands operating side by side. This way our publishers can take advantage of all the offers without the hassle of switching to a new platform.

SGO: SponsorPay also announced that it plans to serve more social games and app publishers in the future. Do you expect a lot of growth in these areas?

JB: We are already working with 8 of the 10 largest MMO publishers in Europe so for us at least the social games and apps markets have the highest growth potential. We have been able top increase revenues two or threefold for social gamespublishers in the US who had previously worked with American providers, so we know that we are on the right track. The growth in user numbers in social games is just staggering, so obviously we want to be part of that.

SGO: How did the Scamville scandal affect Sponsorpay?

JB: Our approach has always been sustainable monetization. Even before the scandal we made sure that our offers would all be high quality and transparent for the users. The whole scandal only confirmed that it was the right decision to position ourselves this way and we got positive feedback from the market as a result of it.

SGO: At Casual Connect some rather sceptical voices were raised with regard to the future of offer-based monetization models. What makes you so optimistic that the model will establish itself in the long run?

JB: I just have to look at our weekly growth rates, the industry growth rates and the growth of the publishers we are working with that all indicate that this model has a lot of potential. And it is quite obvious to see why: it creates a win-win-win situation for publishers, advertisers and users. Of course offer-based monetization has a future – a great future!

Jan Beckers is the Managing Director, Head of Publisher Relations and Co-Founder of SponsorPay, a Berlin-based Start-Up in the field of online game monetization. Jan is a also Venture Partner at Team Europe Ventures and the managing director of his own investment company JB-Ventures GmbH.


SponsorPay Announces Takeover of GratisPay

By Gary Merrett

This year´s Casual Connect started this morning with a big bang in the world of virtual currency monetization. The Berlin-based company SponsorPay, already one of Europe´s leading monetization platforms, announced that it has acquired GratisPay for an undisclosed fee.

The two companies, who help developers monetize their games through advertiser-financed virtual currency transactions, had been battling it out with each other over the top spot in Europe since the two companies entered the market in 2009.

The two brands will continue to operate under their current names, but the merger means that SponsorPay as a company has now undoubtedly become the biggest provider of offer-based payment solutions in Europe as the company looks to take advantage of the additional publishers and advertisers in their portfolio. Together, SponsorPay and GratisPay already serve most of the top ten online and social game publishers in Europe and it can be expected that, as a result of this deal, the new SponsorPay will become an even bigger player in the coming months and years.

SponsorPay, who until present primarily helps monetize MMOG´s, also aims to strengthen its position in the fields of social game and app monetization.


Casual Gaming in Europe: An Eye on Germany, Britain and France

By Gary Merrett

The International Gamers Survey Report conducted by TNS and (and published under has revealed that Germany leads the way in Europe regarding the amount consumers spent on online game portals in 2009. Around 3 million German consumers spent an average of 180 Euros per person per year, totalling a staggering 540 million Euros. 2.4 million British online casual gamers spent an average of 130 Euros per year (totalling 310 million Euros) whereas 2.2 million French users spent 123 million Euros per year (totalling 270 million Euros).

In each of these countries, most gamers do not pay to play. Only 21% of German gamers, 19% of French gamers and 18% of British gamers were prepared to open their wallets for online games in 2009. However, this is set to change in 2010 as the companies behind online game portals such as, and, whose business models heavily rely on advertising, are increasingly finding ways to monetize their users by offering them unique games, premium quality or the possibility to win prizes or money.

Buying online credits was the most popular way of spending money used by German (42%) and French (55%) paying online gamers, whereas buying subscriptions was the most popular method among British gamers in 2009 (32%).

The report also provides evidence for the increasing popularity of social games on social networks such as Facebook. Both in Germany and in France, around one in four game portal players also play games on social networks whereas the figure for British portal gamers is 38%. Indeed, social games are becoming a real force in gaming, with one out of ten casual gamers in each of these countries already choosing social networks as their primary gaming destination. In the US, as much as 24% of gamers prefer to play on social networking platforms such as Facebook.

In the report by TNS and, Rik Haandrikman, Head of business development at international online gaming company GamePoint, is cited: “The range of business models in the online casual gaming business is staggering. With the rise of social networks as gaming destination things are getting even more exciting. We recently launched our games in Facebook and created an entire international multiplayer platform with tens of thousands of players and a working virtual economy in just a matter of weeks instead of the years it took to build our first game community.”

Newzoo, the company behind and the International Gamers survey report, has announced the Casual, Social and Mobile Gaming Monitor; a new six-monthly survey (March and October 2010) on these fast-moving parts of the games industry which will be launched at this week´s Casual Connect in Hamburg.


The iPad – Opportunities for Social Games

By Sebastian Sujka

When Apple released its Ipad many observers were disappointed. It did not turn out to be a replacement for a laptop and left many wishes unfullfilled. Critics call the Ipad just an overgrown iPhone.   Despite most of the  criticism coming from business  insiders and experts with huge expectations,  there is reason to believe that the Ipad will turn out to be highly popular. One  argument for the Ipad’s success is that it creates a new platform for games. The iPod touch and the iPhone have already revolutionized the portable gaming industry. With the Ipad new opportunities for gaming arise. We look into the possibilities that the iPad brings for game and app developers.
The Ipad runs almost all of the 140,000 iPhone apps that are already available. Consequently, all existing apps

can be sold for the Ipad. The user has the possibility of  synchronizing his existing applications and  playing them on a bigger screen. He has the option of playing the app  in its original iPhone format which feels very familiar but leaves a lot of empty space on the display. The other option is to double the pixels and to play the app on the full 9.7-inch display. The disadvantage here is that the graphics look a bit pixelated around the edges.

It can be expected that a lot of developers will focus on adjusting games to iPad standards: The same game with a better resolution on the bigger screen will lead to a better gaming experience. Games like Rolando will be even more enjoyable on the new device. The more sophisticated approach is to extend the game as the bigger screen offers more possibilities. The game stays the same while the additional display space can be used for new features. The most interesting option game developers have is to   release new games that cannot be played on smaller devices but only on the iPad. Completely new games will be developed taking advantage of the new possibilities. The obvious thought is to develop games that could not be successful on the iPhone as the small screen limits the gaming experience. One  example  is real-time strategy games.  While it was impossible to control groups of tanks, groups of soldiers etc on the small touchscreen, they should be fun to play on the iPad. The same applies to  all the different flight simulaters or RPGs. As it is hardly possible to immerse oneself into the game on the iPhone screen, it will be be particularly interesting to see how game developers will use the additional screen real estate for RPGs, MMORMGs and other networked games. Another possibility we can look forward to are boardgames. The iPad should be capable of recreating the boardgame experience and its networking capabilities make this option even more interesting.

Apple sees its new iPad tablet as a serious gaming platform. So do we. With its graphics the iPad is a powerful mobile gaming device that is sure to outperform Nintendo DS or the Sony PSP. With  this new piece of hardware mobile gaming could become a very interactive experience.  Needless to say that, given the creativity and inventiveness of developers, we can look forward to the first iPad games.