Zynga won on Facebook with the business equivalent of blitzing on every play…My understanding is that margins are razor thin and buying traffic is a requirement, especially for continuing the growth curve. Losing 30% of revenue to the Facebook credits tax [would instantly destroy the economics of their finely tuned direct marketing math equations].
Source: jonathanmarcus
eBay noted that Paypal represents 50% of total payments on Facebook, and by the end of ‘09, gaming company Zynga was the 2nd largest Paypal merchant after eBay. Paypal had $500MM in virtual goods revenue in ‘09, which was 2x from ‘08, and we believe this could grow by 50% in ‘10.
The pillars of success are play (having something fun to do), express (a way to share your success with others), and invest (to do things in the game that will pay off in the future). If a player is successful with a game, they gain social capital because their real friends will see how well they are doing.
