Can You Make Money with Facebook?

Over 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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