Inside Social Games

Branded virtual goods company AdNectar is expanding from its base on Facebook to Twitter and LiveJournal, in a test of how much users on those sites want to send items like Fisher-Price’s Elmo Tickle Hands “Ticklegrams.”

Virtual gifting has been a hit on Facebook, including the giving of branded virtual goods. Facebook’s own gift store is making around $70 million a year, we hear, and countless gifting apps continue to be popular. But it remains to be seen how well these sorts of gifts work on other sites. Virtual goods have not proven a big business on Twitter, to our knowledge at least; LiveJournal has its own gift store, so the AdNectar integration is pretty clear. The tightly-woven set of applications and friend connections on social networks seem to be what makes virtual goods especially meaningful to people.

On Twitter, AdNectar is partnering with a company called fun140, which already has a sizeable Twitter virtual gifts selection along with games, quizzes, and other entertainment. It just doesn’t have the branded goods that AdNectar has. The way fun140 works, a Twitter user sends a gift from fun140’s virtual goods store, the recipient gets it as a direct message (DM), and the sender also automatically posts a message about the action to their own feed. It’s not so unlike how the dynamic works on Facebook, except that Twitter users have found this action spammy. For more, see what  social media consultant Chris Brogan had to say about it earlier this summer. Note: I don’t currently see any of these gifts live, so the screenshot is from Facebook.

Perhaps being able to see the major brands AdNectar works with on Facebook will get people more interested? Malibu Rum, Nestle’s Toll House, Trident Gum, Overture Films (Michael Moore’s Capitalism: A Love Story), along with the Ticklegrams, have been running on the site for months.

In terms of cost, the branded campaigns run “between $50,000 and $150,000, depending on the number of social media sites involved, the level of exposure, the duration of the campaign, and the number of branded goods,” according to BrandWeek. What sort of results has AdNectar gotten on Facebook?

In a past campaign for Godiva where AdNectar integrated virtual goods into third-party gaming applications like Friends for Sale, users sent 1.1 million branded goods, resulting in 52 million total impressions, 77,000 clicks to Godiva’s fan page, and 12,000 fans. Purchase intent increased by between 20% and 60%, according to the company.

So, for AdNectar, this expansion is a quite reasonable experiment in trying to further the reach of its clients.

To dig deeper into the virtual goods market, check out our new report: Inside Virtual Goods: The US Virtual Goods Market 2009 – 2010.