My take on zynga and cpa offers

Michael Arrington posted over the weekend about CPA offers within
social games and questioned why facebook, myspace, zynga and others would expose
these to our users. He raises good points about ‘scammy’ advertisers and the
bad user experience they create. I agree with him and others that some of these
offers misrepresent and hurt our industry. 

It has been my mission at zynga to create a sustainable
consumer service with long term value to our users and partners.  Social gaming is emerging quickly and requiring
new rules of engagement from host networks to user payments and
advertising forms.

So why does zynga offer these ads?  

Most of these offers are good for the
advertiser and user. There are many users who don’t have access to online payment
methods who are still interested in making in game purchases. There is also
great potential for large web players like amzn, ebay and netflix to leverage
social media channels like facebook and zynga to acquire new user
relationships. Sponsoring a white tiger or pink tractor may accelerate these customer acquisition campaigns.

The offer industry is still just getting started and this category
of advertising makes up a small minority of our revenue, the bulk of which comes
from users directly purchasing virtual goods.  

We have worked hard to police and remove bad offers. In fact,
the worst offender, tatto media, referenced in the techcrunch article, had already been taken down and permanently banned prior
to the post. Nevertheless, we need to be more aggressive
and have revised our service level agreements with these providers requiring
them to filter and police offers prior to posting on their networks. We have
also removed all mobile ads until we see any that offer clear user value.

At zynga, we have faced a similar challenge in providing customer support to millions of users of our free games. Six months ago we were
overwhelmed with our ticket volumes and faced an F rating with the better
business bureau. We made massive efforts to address this, getting our maximum
response times for live email and phone support down to 72 hours and raised our
rating to a B+. Even today we realize our customer support isn’t at the level
our users expect and we continue to work on it.

Similarly, we are working to improve the quality of the CPA offers
exposed to our users and evolving our policies and practices to ensure that
zynga is worthy of our users’ trust.

There is no doubt that social gaming is entering the
mainstream culture and there is a business to be created around fun. It's particularly
exciting to see how social games can empower people to change their world.  In a small way, we have seen this with our
sweet seeds for Haiti campaign where Farmville players raised $500k to provide
lunches for 500 kids for the next year. We expect to do more.

As we evolve to a world where people connections are the
basis for the largest consumer services, we will face more challenges. I’m
confident that with so many smart people (and critics) we will overcome these. 

19 thoughts on “My take on zynga and cpa offers

  1. Mark,
    It sounds like you have done a great deal of work moving your BBB rating up. Personally, I find the spammy nature of most offers to be borderline evil and I’m glad that you saw that before these recent articles became popular.
    I applaud any efforts to protect the average consumer (those who are not usually savvy enough to spot the “bad” offers.) And if these efforts come from an icon in the industry(you), all the better. I wish you the best of luck in reaching an A+

  2. Mark,
    Good job on stepping up to address this huge problem.
    Only PayPal collects more revenue from online games in the U.S. than prepaid game cards (over 40% of all revenue collected by U.S. free to play games will come from prepaid cards this year – North of $600M).
    Users only turn to offerwalls when games neglect this channel by not offering an option or by offering the scam prepaid card called the Ultimate Game Card (which charges hidden fees and locks up part of the card value). When is Zynga going to address user demand and get a friendly prepaid card (that I can use on games other than just Zynga too)?
    Check out Peanut Labs user survey in response to the Techcrunch post:
    http://peanutlabs.wordpress.com/2009/11/02/survey-finds-arrington-has-a-point-given-choice-users-overwhelmingly-prefer-direct-payments-and-research-surveys-to-cpa-offers/

  3. The worst offenders may have been taken down before the blog post, but not before the conference where Arrington first exposed them.
    So what I am hearing is that criminals don’t like getting caught. Not much new there, and little cause for hope.

  4. It good to see you’ve taken the responsible approach. Have you thought about a minimum age limit for your CPA’s? yes you’ll take a hit, I don’t know the numbers but I guess, most of the points earned via CPA’s are from shall we way your younger players, but in the long run (and Zynga is, at least from what I can see, in it for the long haul) you head off any bad press and have players who want to take part in your CPA programs again because they are old enough to make the call as to whats a good deal and what isn’t.

  5. Great post Mark. I am a smaller app developer but always trying out different offer walls. Seems like a lot of these guys are cleaning up their act. Over the weekend received emails from RockYou and AdParlor about their efforts to keep things legitimate. Should be interesting to see how things play out over the next few days/weeks/months…

  6. How your company is even in the running, and making money by scamming people is beyond me. Prey on the suckers, but never think that it’s a commendable endeavor, even if you spend a few bucks on charity to help your own bottom line.
    Zynga is a second rate company, and soon people will realize that. Doesn’t matter to you though, you’ve already made the money.

  7. Hi Mark,
    Just wanted to offer you some helpful tips from someone who has been selling digital/virtual goods for the past six years with our main monetization method being CPA offers although, not on the scale you have.
    Your troubles of late can be attributed to using a network such as OfferPal to serve your offers. In fact, we looked at them and other similar companies several years ago, but decided against using them. Here are the reasons why we choose not to use such a network.
    1. You do not have full control over what offers are being presented to your users. While you may be able to black list offers, you are not able to optimize the offers to your users based upon demographics. As well you have to screen the offers from them or you will find yourself with this same problem of promoting shady offers again.
    2. You are losing revenue due to the fact that OfferPal is simply a middle man that gets the CPA offers from another network and takes a cut. Sometimes there may be several middle networks each taking a share of the revenue. I have seen several of the offers you have been promoting and can tell you what you should be getting for them. Such as Jamster ringtones $12+, FlyCell ringtones $20, and RingnRock ringtones $18, this is just one offer type but you get the idea.
    3. With each network that is in the chain you have potential loss of leads due to faulty tracking. Conversions are always better when dealing with the offers originating network
    What we found worked best was to set up our own offer delivery system. It was not hard to program as even the least experienced programmer could set this up in a few weeks. This gave us full control of the offers that we displayed as well as allowed us to receive much higher revenue by cutting out the middle networks. The only drawback to this method is that you will have to have someone who is very familiar with the affiliate marketing industry that knows where the offers originate and what networks are legitimate. Many CPA offers come and go very quickly so this person would have to manage the availability of offers closely.
    The salary of this person or persons would be paid many times over by the increase in revenue due to the higher payouts, better tracking, and offer display optimization.
    Just wanted to offer a suggestion from someone on the outside looking in.
    Keep up the good work.
    Kind Regards,
    Joe

  8. In the balance, you deserve credit for acknowledging and working to resolve the ‘hell’ish situation in a manner that the jihadists hadn’t really considered (Offerpal is too busy smugly congratulating the profane, to-the-letter-of-the-law defense, TechCrunch is lobbying for governmental regulation).
    While I agree that it’s disappointing these types of offers got through in the first place, it’s very heartening to see this kind of a response as opposed to the ‘Show me where this is illegal’ responses I’m seeing peppered everywhere else.
    For my part, I had vowed to stay away from any offer wall for exactly the reasons that are now being addressed here. If only because changes were mentioned, one more visit is guaranteed, if only to see those changes, and as a sort of reward for acting responsibly, instead of reacting vehemently.
    On a sardonic note, I fully enjoy the corporate social responsibility plug. What’s next, a fund for victims of mafia hits through Mafia Wars?
    In seriousness though, I am grateful for your taking a calm, collected, serious look at this issue. Thank you.

  9. I’m impressed with your handling of the incident.
    I do have to note that the reason spammy offers exist is because people like them and click on them and get value from them.
    Everyone who runs a website understands this.
    There will always be a coterie of sophisticates who believe the offers are junk and culturally tacky, but they appeal to the masses. One should make a distinction between outright fraudulent advertising and just culturally low-brow offers and make sure only the former are removed.
    I’m also wanting to dig a LOT deeper on to why Arrington himself took this on. What’s in it for him? He sees social gaming advertising somehow cutting into his tech press ad space and revenue? He is not a crusading investigative journalist; he is an investor in technology himself, and himself makes or breaks start-ups he likes or doesn’t like on a personal whim. He can develop a cultural tic against some product or service just because he thinks “our crowd” will not like it, or he doesn’t like it.
    So what’s up here? I’m wondering if in fact he like other Silicon Valley gurus and tech press simply hate the way that UGC and social games take away the power they thought they had to make and control social media. I think that’s simply what it’s all about. They either invest or control through their media or control by being the select beta testers and power users (Twitter 100, etc.). So they hate it when power and money circuits develop outside their range.
    But since this describes Zynga itself as firmly planted in the Silicon Valley culture with the “California Business Model” (give away content for free or harvest freemiums for pennies and sell ad space for the eyeballs), perhaps it is merely in-fighting.

  10. i think thats great some of them were smammy esp mobile one
    i play many of your games and yoville is my most fave although the day you took these offers off loads of us can no longer buy yo cash when is this likely to be fixed???? i HAD to use one of the offers and sign up for a casino just to get it and now no offers and no yo cash…we are not happy campers!!

  11. Dear Mark,
    I am posting this to you as I have not had any response back to the complaint I sent in 1 week ago.
    I am currently playing one of Zynga’s games called Pirates Rule.
    For the past nine days I have been continually harrassed by an individual using 8 odd accounts with facebook.I am attacked daily by him and countless bounties are set upon my pirates character despite him being told to back off by other users.
    I changed my characters name using what points I had but to no avail.
    In my eyes this is the equivilent of internet stalking and I am sick to death of the abuse.As soon as I log in he is at me again.
    I have taken numerous screen shots and they are available upon request.This user has taking the fun out the gaming experience I had hoped to enjoy with Zynga.
    Please help me remedy this situation.
    Sincerely,
    Deborah

  12. I see that you want better customer service but you guys cant even answer a simple question. I have had numerous times that I had sent in a question or issue and 90% of the time that answer had NOTHING to do with my question.

  13. hi mark, i reallly need ur help on this thing, my account in facebook was hacked 3 mos ago, because im playing yoville, i cant access it naymore, because the hacker change the email add that im using there…can u help me get my thins back, im using new account now in facebook to play again in yoville, pls help me

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