After the historic IPO, the Facebook is now revamping its marketing and revenue schemes. While yesterday if it was the acquisition of Face.com, today the Facebook took a giant step to make the app developer community happy. The company has announced on its blog post that it was revising its payment system, by adding: subscriptions and local currency pricing.
From next month, it will offer developers - mainly makers of gaming apps -- the ability to charge for subscriptions. This will allow developers to charge users in local currencies (in US dollar or the British pound), rather than pricing everything in terms of Facebook Credits (current payment mode).
3 Ways it will benefit the App developers
Monetize Apps
Initially, Facebook followed the virtual currency form of payment for games like FarmVille that still run on its website.
However, with this revamped payments system, developers will be able to monetize their apps with the new subscription model and not bound by the Credits virtual currency system.
Subscription - A Right Move
Subscriptions, which are already used in other gaming platforms, are often required for gamers to get premium features and other perks. The new subscription plan on Facebook will provide developers a new source of recurring revenue. This would mean bonanza for companies like Zynga.
Further, the subscriptions will also fetch Facebook 30 per cent of the transacted amount, a new recurring revenue stream for the social network giant.
Price in-app Items With Local Currency
Earlier, all transactions were through Credits. It was designed to make it easy to buy virtual goods across multiple games.
However, most developers also created their own virtual currency systems, which became an awkward two-step process.
This required consumer to first buy Facebook Credits, and then swap them for FarmVille Cash or other in-game currencies. Moreover, consumers would have to do this for each developer's game they played.
Now, Facebook is allowing users to simply purchase virtual currency directly from a developer in their local currency, without having to use Credits. This will also make it easier for developers and their users to transact even though they may not be in the same country.
Hence, these changes will open up a vast market for the developers on Facebook.
In the meantime, expect Facebook to do much more to make sure developers keep ranking it in on both, the Web and mobile platforms. With its newly launched App Center, Facebook is helping drive traffic to the mobile app stores, where developers make big bucks.
