Social Gaming to Top $1 Billion This Year

written by: Gianluigi Cuccureddu

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Published on Friday, 14 January 2011 10:19

A whopping 28% growth from last year, from $856 million to over $1 billion. That's the projection by eMarketer for the social gaming market.

The LA Times elaborates on the three main revenue streams within social gaming:

A look at the revenue sources reveals three main contributors: virtual goods, straight-up advertising and something called "lead generation." That's when someone fills out a survey, signs up for a newsletter or applies for a credit card in exchange for virtual goods within a game.

Expected is that brand advertising is going to drive the growth. Ad spending is being projected on $271 million, being doubled from $120 million last year. Relating back to "lead generation", it's an interesting revenue streamfor advertisers, but users are perceiving it as spammy and become more careful giving away email-addresses. Lead generation is expected to shrink to 19.6% by 2012 from 26.3% in 2010.

Paul Verna, an analyst with eMarketer, said:

"Even though fewer than 6% of U.S. social gamers spend money on virtual items, these avid players will produce $653 million in the U.S. alone this year. This is the largest segment of the social gaming economy, and one that marketers are increasingly turning to as a branding vehicle."

This means that a 6% is generating 60+% of of the total revenue, a great spot for social marketing, enthausiasts that can viralize the game and attract new players.