Zynga Uses More Money to Attract Players than They Spend in Social Games

An analysis firm has calculated that social gaming firm Zynga is spending no less than 150 dollars (116.4 Euro) in order to bring in one new player for its titles, even though the overall average contribution from one is smaller than that over time.

Arvind Bhatia, who is an analyst watching the video game industry for Sterne Agee, stated, “They've given us the sales in marketing dollars for the first nine months - $120 million. Almost all of that is for acquiring customers. We also know that they had 3.4 million unique payers in the September quarter, which is up from 3 million at the end of December 2010. In other words, they added 400,000 additional payers and they spent $120 million to acquire them.”

The analyst has also found an overall decline in the rise of the social game space, which is affecting other players beside Zynga and might accelerate in 2012.