FarmVille maker Zynga loses $150 per new paying player ... or does it?
Broken down, that amounts to $300 spent on each new paying player, and here's where things get hairy for Zynga, according to Bhatia. "We know that, on average, these people are spending about $150 or so," Bhatia said, according to Benzinga. "Our concern is [whether or not it's worth] spending $300 to get these customers when people are spending $150. That math won't work for very long."
What did we tell you? It's that damned math that ruins all the fun. And, according to Bhatia, the guys behind CityVille shouldn't be alone in their concerns. "I think it's telling us [about] a slowdown in social gaming in general," Bhatia said. "I don't think it's just Zynga. But Zynga clearly has tried many games, and they're finding that the interest level isn't necessarily going up. We've seen many games launch and then fade within a few weeks."
The analyst was referring to recent releases like Adventure World, Mafia Wars 2 and Pioneer Trail, all of which have been on steady decline since their late 2011 launches. But why are these recent games not providing the unprecedented growth of your FarmVille's and CastleVille's? "The really hardcore are, perhaps, finding themselves trying FarmVille, Castle World and CityVille," Bhatia said. "The newer audiences are trying and finding that this is all the same and leaving."
Here's another reason we hate math: Sometimes, it can be wrong. At least that's the case in Zynga's, um, case. If you ask NaturalMotion CEO Torsten Reil, Zynga is actually making $30 on each new paying player. According to Founderware, Reil said that Zynga must have lost players within that nine-month period, and therefore garnered more paying players than just 400,000. More to the tune of 1 million, which by Reil's math makes for $30 gained per each paying player. Ugh ... math.
Is Zynga might be losing or gaining money on each paid customer? And why aren't Zynga's more recent game releases growing at the rate or volume of, say, CityVille? Sound off in the comments. Add Comment.