Reuters report that Asia’s social networking sites appear to have solved found lucrative ways to leverage profits from their online gamers. Asians spend an estimated $5 billion a year on virtual purchases via websites such as Qzone, Cyworld in South Korea and mobile-phone based network Gree in Japan, according to Plus Eight Star.
Georgina Prodhan and Tarmo Virki report that “Of the virtual sales in Asia, about 80 percent comes from the sale of such items as equipment for online games such as rods for GREE’s fishing game Tsuri Star 2. The rest comes from purchases for avatars on social networking sites.”
Such is the success of virtual sales on Asia’s social networking sites that the likes of Facebook are looking at the potential virtual money can generate.
To put this in perspective:
- Qzone’s Tencent Holdings made over $1 billion last year with just 13% coming from advertising revenue.
- In contrast, Facebook and Myspace depend on advertising to fund most of their revenue.
- Cultural issues. Gaming is popular among adults in Asia; in the West it mostly for kids.
- Status. Asian societies are very status conscious. No one wants to have an avatar with last year’s bling.
- Asia’s social networking sites are country specific but have very active user bases.
- Qzone had 228 million active user accounts for Q2 2009.
- Cyworld had 23 million unique visitors per month at the end of the Q1 2009.