From Dimes to Dollars

by Ben Lopez

Jason Calacanis recently interviewed Neil Young, founder of NGMoco Games, and the man behind massively popular iPhone titles such as We Rule, Godfinger, and Eliminate.  Maybe you’re one to scoff at iPhone games, and consider developers like NGMoco to be minor league, but that’s hardly the case, as the App Store marketplace is a particularly lucrative venue to distribute games.  I was stunned when I heard some of the figures people were spending on in-game items using real money: how does $10,000 within a month sound to you?  You read that right: TEN GRAND.  There are folks that don’t earn that in a year, yet the geniuses at NGMoco have convinced folks to spend that much to grow magic cauliflowers.  So how do they manage to empty your wallet at such an alarming rate?  Micro transactions and compulsion loops.

Micro transactions, such as a .99 purchase in the app store is a “why the hell not?” impulse buy.  These unplanned purchases can add up quickly, of course, and that’s what more and more companies are banking on.  Expect to see this sort of add-on/in-game pricing become much more widespread.

Compulsion loops are nothing new.  They’ve been around for decades, long before the original Nintendo Entertainment System in the 1980s in the form of PC role playing titles.  Some of the earliest compulsion loops consisted of the same model you see within numerous titles today, allowing a player to “level up” and become stronger, acquire new abilities, and access to new content within the game as a result of putting in time and/or skill.  This is an especially enticing model for players, and is by far the most widely used for good reason.  Let’s say you just put in another 2 hours on a role playing game, and despite playing through several battles, you don’t make any progress in the storyline.  You’ll still feel as if you’ve accomplished something because your character has gotten stronger, or perhaps you found a valuable new item while exploring.  In other words, you never feel like your play time is wasted.  Other incentives to continue playing include leaderboards, public award badges for completing specific tasks, or real/virtual prize money for placing in events.  So in a shooting game, maybe you’ll earn an award on your profile page letting other players know that you played through a match without a single death.  It may sound petty, but given the large investment of time involved, people begin to pride themselves on these honours.  Eidos recently offered a real money prize for a stunt contest in their open-world game Just Cause 2.  This was an innovative spin on the cookie cutter “highest score” or “quickest time” challenges, even if the contest itself was marketed rather poorly!  Social obligation is another huge factor, something any Farmville player should know; if someone helps you tend your crops, you probably feel obligated to return the favour.  

You’ll also notice that NGMoco has a range of difficulty in their games; some you can make progress in by simply putting in time, and others are more hard fought skill-based titles, such as the first-person shooter Eliminate.  They are effectively covering all the bases for differing potential audiences, and it’s certainly paid off for them.

Chances are, the majority of the D2D readers aren’t game developers.  But that’s not to say you can’t develop compulsion loops for your area of business.  Reward loyal customers, find smaller bite-sized payment methods that are easier to swallow, and give your top contributors recognition for their work.  Get creative!  If NGMoco can earn millions off of a model developed decades ago, just think of what you might accomplish with new, innovating compulsion loops.

by Ben Lopez

The problem with social media these days is that we’re constantly being pushed to make everything connected, and encouraged to share exactly what we’re doing, buying, and where we are. What does this equate to? NOISE, and lots of it.

Perhaps you read somewhere in one of those dime-a-dozen SEO e-books that maximum exposure is critical.  Well, not when you’re scaring off users from your website and social media accounts, readers from your blog, and potential customers for your business with information overload.  You wouldn’t call someone 10 or 20 times a day to tell them you’re playing a game, would you?  Of course not, that’s just not socially acceptable.  When you post things online, think of it as a real life conversation, and remember this when considering how often you want to inform people of every minute detail.

It’s inefficient for all of us; the chronic poster loses subscribers, friend interactions, and it is more difficult to keep track of their own activities due to the very clutter they themselves create. For the rest of us, it clutters our friend feeds, RSS feeds, and inboxes like nobody’s business, good grief. Same concept as people that forward a dozen or more e-mails a day. You’re my friend, and I still like you as a person, but at the end of the day it’s just bothersome to delete all those e-mails. In the same way, it’s bothersome unsubbing/unfriending, hiding individual apps, and tweaking my display settings due to the pseudo spam of others.

My advice: DO NOT LINK TWITTER to your Facebook, LinkedIn, or Myspace account, or else we’re all doomed to suffer endless pages of “LOL yea i no” and “help me tend my crops in Farmville!”. Assuming you don’t post a new article every hour, auto updates from your blog are generally considered acceptable. If you play games, get rid of the ridiculous number of updates that flood both your wall and our friend streams.

Follow these simply rules and it’s entirely possible our planet may not be doomed (maybe). What do you think? Is there still a chance of redemption, or is society beyond hope?

by Ben Lopez

It’s time once again for the week in review: for those that can’t be bothered reading all of those pesky articles in their entirety, this is the weekly post for you!  Of course, if you find one that strikes your fancy, just give it a click.  But enough with the patronizing instructions, onto this week’s highlights:

I decided to start off the new week with a bang and jump right into a topic that had been bothering me for a while now: Tumblr blogs that don’t allow comments.  I go on for a while on why you would never, ever want to do that.

 Jason Fried and David Heinemeier Hansson, founders of 37 Signals, share their thoughts on business plans.  37 Signals is an excellent blog that I heartily recommend.  I also own their book, Rework, and can hardly put it down.  These two men will make 30-year CEOs question traditional business wisdom, and embrace technology like a new born puppy.

 Some of the other entrepreneurs had some excellent blogs this week as well, so I went ahead and reblogged Phil Ricci’s experience with a crappy business owner who is sure to fail miserably and added a few thoughts of my own.

 But that’s not where the reblogging (are we allowed to call it RBing?) ends; Mr. Postling himself, David Lifson reblogged some interesting thoughts on Tumblr and @Replies.  Naturally, I had to put in my two cents, so I reblogged the fella and did just that.  

 In this week’s humour, an animated office worker shows precisely how I used to be before I got (semi) organized.  Though I do still have a row of post-it notes lining the top of my computer monitor, so maybe I’m not quite there yet…

 Last, but certainly not of lesser importance, I cover the phenomenon that is Quit Facebook Day.  For those who aren’t quite ready to quit, but are fed up with the privacy issues and still want to show their disgust, I also share when and how you can do just that.

If you found any of the above particularly interesting or useful, please consider recommending this blog for the tech, startups, or entrepreneurs category.  Thanks for reading!^_^

I hate to be so disappointing with a lack of content this past week, I’ve just been incredibly busy trying to get my new project off the ground while still juggling my day-to-day tasks.  I elaborate a little on what’s been going on with my personal projects here if anyone has any interest (unlikely, but possible, I suppose).

This week’s highlights:

I shared some encouraging and insightful quotes from Steve Jobs and Tim O’Reily.  They lend a bit of advice for startups, and provide valuable wisdom on how to treat your peers.

 Google made a huge announcement this past week as they unveiled Google TV to the world.  I made it clear that in my opinion GTV will soon change the entire market, which I believe will lead to, at long last, custom channel packages.  I had some good discussion with other bloggers on this, and even had a brief interaction with Gary Vaynerchuk, who agreed on the custom channel packages.

 Twitter dominated the #1 spot in the iPhone App Store this past week.  It was dethroned after several days by a Farmville clone…which is pretty sad when you think of the implications on our society’s priorities.

 This week’s humour comes in the form of a very unique Twitter service, which I’ve sarcastically deemed “The most useful Twitter service in the history of mankind”.  No spoilers on what it is (little clue in the thumbnail), you’ll have to read the full entry and judge for yourself how useful it is.;)

Typically I put a small mention down here to recommend this blog if you find it useful.  However, I’m not going to do that this week because I don’t think I delivered the past 7 days.  In any case, I’d like to thank you all for continuing to read From Dimes To Dollars, I read every one of your comments and e-mails.

TOMORROW:  I get opinionated in a big way, and publish an open letter to Tumblr users.  I won’t say what it’s regarding, but let’s just say not everyone is going to be happy about it.  Get your trigger finger ready to send that hate mail!