Friday, December 4, 2009

In defense of offers

Question: Who’s the bad guy in the house? (All together) OFFER WALLS! (Once again) OFFER WALLS! (Didn’t hear ya) OFFER WALLS!

Ok, ok, enough with the chanting. Bashing offers is so popular these days it’s almost a new sport. Can’t blame most of the commentators, it’s tempting, and the whole “scamville” charade just made it even more fun. And why not? Offers can be easily portrayed as devil’s spawn, the portal to mischievous premium billing without your consent, money laundering, call it what you may. It’s so easy to terrify non-technical people that you’re almost inclined to join; and if one can benefit a bit from it (no paid service to rid your computer of scam offers yet? Don’t worry, it’s just around the corner), then why not. So looks like we’re covered. Or are we?

I’d like to argue in defense of offers. Not the ones that add unauthorized charges and not the ones that don’t bring any value either. What I’m talking about is the actual mechanism of offers in casual games and MMOs. The best thing about offers, in my opinion, is the creation of a new type of an incentive. Right, it’s not that sophisticated or innovative in essence – just a new type of “thing” users want. But the economics are different: first, the ability to create new items at nearly zero cost keeps demand high; second, game dynamics and the concept of leveling up cause users to be less sensitive to inflation (since I leveled up, it only makes sense that my +1 sword is worth less – now I can pursue the +5 sword!); and third, dual currency systems allow control over the flow of new assets into the system (you can’t necessarily buy your way into everything, unless the developer lets you). Above all, and I am repeating myself here, virtual goods have no inherent moral value: they are not bad by themselves. Only uses of them are.

Why is this distinction important? It’s important because it helps us remember that offers can be used to create goodness (or, in a less idealistic phrasing, value). The demand for offer-based rewards can be steered towards participation in ESP games (tapping into the wisdom of the masses), researches for the greater good, even raise participation in organ donor organizations (by raising awareness, not by tricking people to sign). Too much? Maybe. I think that the whole idea of mini-tasks is amazing, and veers far from tricking users into paying additional money. In the meantime, we’ll settle for your standard capitalist value creation: Offerpal’s latest teaming up with retailers is a good sign of main stream retailers adopting the new type of rewards. In defense of offers, this is one more step toward making this mechanism a highly legitimate and efficient one.

1 comment:

Matt McAllister said...

Nice analysis, Ohad. I agree that most of the offer-bashing is way overhyped. Thanks for being the voice of reason!