Zynga ‘losing $150 on every new paying customer’
High cost of obtaining a new customer compared to customer’s lifetime value sounds a very similar scenario to what was happening in the first dotcom boom. It seems Zynga and Groupon have similar challenges ahead.
The question is will the money extracted from adults that don’t have better things to do than play web games sustain Zynga’s valuation? The valuation is based on promise of further growth and that might be hard to find.
Zemanta says Zynga is already looking at on-line gambling market. Surely that can be a growth area. And social betting? Imagine a wager with your neighbor about who’s going to have bigger Farmville harvest next week? Win and win. Cha-ching.
Social games giant has ‘spent $120 million on acquiring new users’, claims analyst Zynga is losing $150 on average for each paying new customer it gains, an analyst has claimed. The social games giant has allegedly spent $120 million on acquiring new customers in the first nine months of this fiscal year, but has been unable to gain enough players.
- Zynga ‘losing $150 on every new paying customer’ (develop-online.net)
- Apes, Zombies, Sparks and Goo – Zynga Acquires Four Gaming Companies (socialtimes.com)
- Zynga Slides For Second Straight Day (socialnetworkingwatch.com)
- San Francisco’s Zynga Mulls Online Gambling Market (sanfrancisco.cbslocal.com)
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