new solar eclipse

A few days ago Sometrics, an analytics tool for social networks, launched it’s new venture into virtual currency.  If you’re not a die hard social network person (or have better things to do with your time) then you might be wondering what on Earth virtual currency is.  Well it’s like real money, but faker.  Actually, it’s a clever way for application developers to monetize their apps while at the same time engaging their users.  Essentially, it works by requiring users to complete certain offers, provided by the publishers such as Social Media and many others.  Depending on the offer, you award your user with a certain value of points, or currency, that can be used within your application as a kind of reward.  If you have a virtual gifts application then the user can redeem his/her point or “virtual currency” for some premium gifts or whatever else your app offers.  It’s a very interesting concept, which ties closely with my recent blog post about micropayment processors, which would take the virtual currency model to the next level because no longer would a user have to complete some random offer they aren’t interested in, they can just buy credits or points or whatever with their credit card or payment gateway account.

Sometrics isn’t the only ones offering this service.  There are other companies including Social Media as mentioned above.  However, the primary difference between the two is that SM is a monetization platform that connects advetisers and publishers, while Sometrics was up until this new product launch an analytics tool allowing you to track traffic to your social networking application, whether it be on Facebook, Hi5, Myspace, etc.

The most intriguing part of this virtual currency is that it increases user engagement while being a source of revenue for the developer.  I remember back in the early days of the Facebook API when one of the biggest applications was “Aquarium,” and what it basically did was allow you to put random fish in an “acquarium” and have them swim around this “acquarium” that was on your profile page. Yeah I thought it was pretty dumb too, but for some reason it was among the top 5 applications and had a virtual currency system implemented where users would get points for logging in each day as well as completeing offers (pretty smart because it increases page views with users being forced to access the app to get more points).  In turn, users would exchange that currency for better and more interesting fish.  It was estimated that the developer of the app was making somewhere around $700k a month, though some people have said it was a lot less while other said it was closer to $1 million. Just goes to show you how rediculous, and lucrative, some of these applications can be.

Look for more implementation of this virtual currency system as application developers look to find creative ways to monetize their application userbase.