Ann Arbor’s BodegaBid Bets There’s Real Profit in Virtual Currency

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Zombie, whose virtual items can also be traded in the BodegaBid marketplace on Facebook for credits. Bodega credits, in turn, can be used to purchase virtual goods for either game.

Sendo says BodegaBid makes money in the same way big gaming companies like Zynga and Playdom do. Gamers use PayPal, a major credit card, or mobile payments, or complete advertising offers, to purchase or earn Bodega Credits. Gamers then use the credits to trade virtual items in Bodega’s marketplace on Facebook. Bodega also charges gamers a small “transaction fee” for trading on its marketplace.

Sendo hints that more deals with top game developers are coming soon to greatly widen his market reach.

Brian Balfour, founder of Cambridge, MA- based Viximo, which also connects social app/game developers with social networks, says that Sendo certainly has picked a niche with huge market potential. The virtual goods/social games space represents a “pretty attractive, massive, lucrative, and growing audience,” he says.

The problem, Balfour says, is that many social games are still in an immature stage, and developers are focused heavily on grabbing as much market share as possible in the still-infant industry. As a result, they have little interest in reaching out to their competitors to help create a demand for virtual goods. Maybe in a year or two that will happen, but not yet, he says.

On the users’ side, the demand does not exist yet, either, Balfour says. “When they buy a farm in FarmVille, users don’t perceive that as owning something,” he says. “They see it as entertainment value, like I’m paying $4 to rent a movie.”

Balfour points to developers PlaySpan and LiveGamer, which he says first offered, then … Next Page »

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