In June 2008 we were approached by what was to come a very large Social Gaming company with a view to buying us out. The numbers were big and there was huge temptation to take the money and run… it gave us a lot to think about.

At the time we didn’t class ourselves as a ’startup’ but this last week has raised a lot of questions in my head again. With Zynga taking over Serious Business and rumours circulating about Microsoft lining up a $200m acquisition of CrowdStar the question is raised as to what’s a good strategy for Facebook development companies.

In the beginning it was simple – make a fairly simple HTML game that was interesting and let people interact with their friends. Watch it grow, sell some virtual goods and make some money. The most difficult part for developers was making sure that the game would scale (ie. That when you got 100,000 people into your game they were actual able to play without the whole thing crashing). Now the playing field has changed.

With EA getting involved by purchasing Playfish for what could end up being $400m, Zynga raising another $180m, RockYou taking $5om and Playdom another $40m there are some massive numbers flying around, and with that it’s getting harder and harder for smaller developers to make a real impact.

This isn’t anything new – just look back to the early days of browser based games and a similar thing happened… it’s just more prominent now as everyone has a Facebook account and so has easy access to games. Whether your 14, 40 or 80 you can play… and if it’s a good social game then you should be able to easily work out how. Login, click click click, visit friend, buy some virtual stuff, logout. Rinse and repeat.

So, how do you take on the bigger boys?

We’re fortunate in that we have a huge userbase to call on but for developers just starting out they’ll need to either get lucky or have some serious cash behind them. Facebook are making it harder and harder to ‘go viral’, so there’s a higher chance that the only option will be to buy users. This makes it even more important to make sure that your virtual economy is setup properly – after all, if you’re paying 10 cents for a user you need to know that, on average, they’ll give you at least that back in the long run.

I predict that over the next 12 months we’ll see a few major trends. Firstly there’ll be a decline of independent developers who haven’t raised any funding getting involved with creating Facebook Games. There will, however, be a steady stream of VC-funded startups creating engaging, fun applications which will take off and be ’stolen’ by the larger companies. From there we’ll see a fight for top spot, lead by Zynga but with the likes of EA, Microsoft and others hot on their heels.

The key will be to diversify. Make a game and don’t just launch on Facebook in English, launch on Facebook in English, French, German and Chinese. Port it over to Bebo, Orkut, Yahoo!, Mixi and wherever else you can. It might need some tweaks and changes but it’ll be infinitely faster than making a whole new game. Also, get involved with other smaller developers. Between three or four smaller teams there’s potential to have access to 10 or 20 million users which really could be the key to driving up numbers.

Oh, and if you’re one of those smaller developers, get in touch- we’d love to work with you.

It seems that Facebook are now choosing which 250 friends people are most interested in and only posting those people to the News Feed. This limit has been imposed recently and needs to be manually reset for people to be able to see all of their friends again. Strange I know, but there’s an easy fix:

1. Go to your Facebook home page
2. Scroll down to the bottom of the News Feed and you’ll see the ‘Edit Options’ link on the right hand side. Click it.
3. A popup will appear with a ‘Number of friends’ text box. Update that to 9999 and click ‘Save’.

Whether this limit remains in place permanently is hard to say, but what’s even more worrying is that it seems to include pages that you’re a Fan of… which means that resetting your limit is even more important.

March 1st 2010 is what we, as developers, have been referring to as N-Day. The date that Facebook are to remove what is probably the most viral part of the whole platform.

Notifications.

The little messages that appeared in the bottom right hand side of your screen (now the top left) telling you that ‘Anna from Bognor want to get to know you better’ or that ‘Mike has just petted your puppy’ will no longer be there. Whenever I’ve mentioned this to a friend the simple question was ‘Why?’, to which I answer (and this is a white lie) ‘No idea’.

The truth is that notifications are now just spam. In the past we saw 10% click-through rates, which have now dropped to less than 1% because of the sheer number being sent by every app under the sun. They are, however, still a great way of letting a person (whether they be friends with the user or not) know that someone has interacted with them on one of our apps. The new Dashboards will go some way to doing this, but I can’t see it being anywhere near as effective, which is where emails come in.

Facebook now allow you to request email addresses from users. The message automatically appears at the top of the screen and as long as they click the ‘Ok’ button you get either their personal, or facebook proxied, address. Now, the only issue is how you get in touch with them.

“Send an email, dummy”.

Yep, that’s right. But how do you send over 2 million emails? Moreover, how do you send those emails and make sure they get through to your intended recipient without getting added to their ‘Junk Email’ folder, and how do you do it while keeping within the law? All questions that are slightly more complicated and have created a rather large headache for developers.

You need to make sure that you have a mail server configured and that you’re using clever things like SPF, DomainKeys, RDNS, etc. I won’t go into the technical details here but all of this is hugely important if you want to make sure you’re getting to the inbox of any given user. You then need to do an API query to get each email address from Facebook and store it in your database. This will take time. We’ve just finished querying about 3 million Facebook IDs and that’s taken 5 days or so. Granted we didn’t use the most optimised way of doing things – with some effort we probably could’ve halved the time it took – but still, it’s no small task.

Now, once you have that you need to work out a way of sending the emails. I’d advise not writing your own script if you have a large amount of addresses (100k+) – instead, use an off-the-shelf product or email delivery service (smtp.com might be worth looking at). Oh, if you don’t want to do that, we can most likely help so drop me an email with details and I’ll give you a quote. /shameless plug. Lastly, and most importantly, make sure you’re within CAN-SPAM regulations.

Finally it’s a case of actually sending out your content. It’s important to note the difference between proxied email addresses and personal addresses as the content you send will most likely need to be quite different. When sending through the Facebook proxy there’s a limit on the HTML content – I found that it’s easier to send plain text with a link, although click-throughs are likely to be lower using this method. There isn’t really an easy answer to what works though so it’s just a case of split-testing layout and content to see what works and what doesn’t. Similar to banner ads I guess!

Whether emails are as effective as notifications, only time will tell. What’s for certain is that Facebook email marketing has the potential to be very powerful if done correctly.

As everyone should know by now, Facebook recently launched an update to the homepage layout. How this will affect the virality of Applications remains to be seen but so far everything seems to be fairly consistent – we’ve noticed a 2-3% drop, but that’s nothing compared to what usually happens when Facebook post a major update.

The most interesting thing to come from all this has been user reaction. Because the roll-out has been staged over at least a week the new layout has reached different people at different times which has made for some interesting Facebook statuses. As always the general consensus seems to be contempt, dislike and horror. Personally I don’t see what all the fuss is about.

The new layout is just what it should be – clean, straightforward and easy to use. Moving bookmarks to the left hand side of the main page was an obvious thing to do, although no longer having easy access from the bottom left of the page is certainly going to take some getting used to. Added to that is the lack of ability to rearrange (which we’re told is to be fixed) and only 3 visible applications without clicking the ‘More’ button. Slightly annoying, but nothing major.

The ‘Dashboards’ are also a great addition and when fully rolled out have the potential to give users a single page from which to find games and applications, along with seeing updates from developers and friends alike. We’ve been testing the Dashboard API for a few weeks now and it’s relatively straightforward, although it should be noted that getting it to work does seem a little inconsistent at the moment.

So, why do users react badly to changes? The answer is simple: people don’t want to have to think about things. Facebook reaches such a large demographic and is used so much that even the slightest alteration is enough to kick start that “What the heck is this” feeling in a person. Give a few days and everyone’ll get used to things again. Until the next time.