SG&VGW 2011: Brands not virtual goods are the focus for Chinese Facebook RenRen

'We look at social gaming differently'

SG&VGW 2011: Brands not virtual goods are the focus for Chinese Facebook RenRen
Giving a speech today in London’s Tower Bridge Hotel as part of the Social Games & Virtual Goods World 2011 conference, Joe Chen, CEO of RenRen, spoke of the difference of approach his company has taken when compared to its American equivalent, Facebook.

Rather than take the 'credits' approach and seek to turn social gaming into a revenue generator for the social network via virtual good purchases, RenRen takes the opposite approach.

"We turn the table," Chen stated. "Facebook looks at [social games] as primarily to make money. We don’t do that."

More than credits

Instead the company heavily promotes what it sees as 'high quality social games' such as Popcap’s Plants Vs. Zombies Social with traditional and modern advertising techniques such as 'zombie flash mobs' in major pedestrian areas in cities across the country.

This active participation in promoting its service's games is a stark contrast to Facebook’s hands-off approach as laid out by the European Head of Gaming Partnerships Julien Codorniou at the Social Gaming Summit last month, in which the company stressed that it was "never going to be in games ourselves" nor "invest in gaming companies".

Instead, RenRen – which hosts Happy Farm, the social farming game that inspired FarmVille – sees social gaming as "definitely the future", but doesn't see ARPU as important a barometer.

"We make more money with brands than virtual goods," he said.

Advertising channel

Chen revealed that unique conditions present in China – more specifically the level of piracy when it comes to big brand names – has led to this alternative balancing of revenue generation when compared to its American rival.

He attributed some of RenRen's success in becoming the leading 'real name' social network in China to the company's early adoption of smartphones when the market was still in its early stages, saying that he expected penetration of the device in China to continue growing at a tremendous rate.

Will's obsession with gaming started off with sketching Laser Squad levels on pads of paper, but recently grew into violently shouting "Tango Down!" at random strangers on the street. He now directs that positive energy into his writing (due in no small part to a binding court order).