Can You Make Money with Facebook?

Entrepreneur 8 Comments

Poor Business CartoonOver the past year there has been a lot of buzz related to Facebook, especially its newly created Application Platform. For those of you not familiar Facebook’s Application Platform lets developers create “applications” that get integrated with Facebook and its users. According to Facebook Analytics Company, Adonomics there are currently 7,900 facebook applications ranging from virtual pets to poker tournaments to food fights. The options for applications are endless, but are they profitable?

Within weeks of launching the application platform, Facebook had over 1,000 active applications, but a majority of them were created with the “have to be first” mentality, instead of being well thought out, leaving most applications without ways to profit from their user bases. I’ll admit that as of late, I too have been interested in dabbling on the Facebook platform to try and create something that could be profitable, but the question still remains, can it be profitable?

Although the platform does allow developers to slap as many ads as they want on the application, they do NOT allow any javascript on their website, leaving most contextual advertising services (i.e. AdSense) out of the money making strategies. In order to profit from your application, you have to be creative in your advertising. You can either try and embed Adsense into an iframe and include that (probably a big no-no), use affiliate programs, look for sponsorship or offer a product.

Affiliate Programs
In the case of affiliate programs you have to make sure that the affiliates you are pushing are related to the concept of your application. If for example, you create a Favorite Games application (Matt Huggins) you could have a “Buy Now” link that is an affiliate with Amazon or a “Rent Now” that is an affiliate with Game Fly. The problem comes when your application doesn’t relate to an affiliate product. How do you find an affiliate for your application that allows you to throw food at your best friend?

Sponsorship
If affiliate links don’t work with your application concept, perhaps you should try looking for a sponsor. In the case of a Food Fight, you could get a food company to sponsor an item that can be thrown; for example you could throw a Ben & Jerry’s Ice Cream Cone at someone. Or perhaps you have a garage application that shows off your sweet ride, well maybe a car product or aftermarket car part company would like a sponsorship slot. This also ties into trying your hand at private ad sales.

Products
This could very well be the hardest way to generate money from your application. Instead of plastering ads or product endorsements all over your application, consider selling products directly to your users. This is hard because you have to offer something that they would be willing to spend money on. Additionally you have to find a way to sell products through Facebook completely or transfer them off-site to complete the transaction. The best product may very well be a subscription to some sort of service within Facebook. Either way consider offering a free version and free trial before making your users pay or you may lose their loyalty.

What has struck me as odd so far about the Facebook Platform is how little application makers are making for themselves. With 50 million active unique users you think making money from them would be a relatively simple task given the right idea.

Perhaps there are just too many applications and not enough people willing to use them? That can’t be true! According to Adonomics those 7,900 exisiting applications were used 33,519,992 times in the last 24 hours. Well maybe those creating these applications don’t have money in mind during development? This could very well be the case, well browsing through a number of the applications it wasn’t clear how they planned to make money. Maybe they didn’t plan to make money or maybe they plan to introduce revenue streams later down the development road, who knows?

What is clear to me is that Facebook has created a prime platform with the potential for making money. It will however take the right application combined with the right marketing to get it done. Who’s up for the challenge?


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    1. 1 Web Community Forum » Blog Archive » Can you make money with a Facebook App? November 9, 2007

      […] Karey asks that question today: According to Facebook Analytics Company, Adonomics there are currently 7,900 facebook […]

    2. 2 Matt Huggins November 11, 2007

      Thanks for referencing my Facebook app, Erik. :)

      I thought I would point out to you that Facebook does allow Javascript. However, it has certain limitations imposed in order to prevent common security concerns with Javascript, as are commonly found on MySpace for example. As such, the JS available on Facebook is referred to as FBJS (Facebook JavaScript).

      Adsense is able to be used, as the Adsense JS code merely creates an IFRAME within a page, which is allowed in Facebook. However, most Facebook application developers have basically found Adsense to be useless in their FBML-based apps due to the ads being contextual relative to Facebook and social networks in general (not the contents/niche of their app).

      As such, many other advertising options are becoming available to FB apps such as Cubics, Advertising.com, and fbExchange. However, I think most application developers are finding the most success in affiliate programs, as you list in your post. Finding a good program that can be integrated well into a viral application can essentially lead to overnight success if done well.

    3. 3 Erik Karey November 12, 2007

      Thanks for stopping by to comment Matt. I figured you might have some input based on your experience developing your own application. Have you decided to monetize your own application yet? Do you know of any applications that are making a decent amount of money?

    4. 4 Kenneth Cleveland September 2, 2009

      Matt/Erik,

      Is it possible to build an App that has widgets within it that can be purchased. For example, in a “food fight” application could you build the app for a person to have to purchase for $1 an item of food that would be thrown? If so, how would you set that up? I have noticed on sending gifts, etc… that it can cost $1 to send it. Does FB make this money or is it an application that others make money on? Please advise – thanks!

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    6. 6 Andy June 17, 2010

      To answer that question, YES, you absolutely can make money with Facebook. Facebook is a growing community, one with millions of new registered users every month, there are tons of money-making opportunities there. Build a massive list of targeted buyers and you can be making easy cash in no time. Invest your time learning how to make money with Facebook and it will be a time well spent. I should know. I’m earning from it.

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