Facebook’s decision to explore the 13-and-under market may present more opportunities for social game companies than the potential legalization of online gambling, but it is not generating nearly as much buzz. I think it is inevitable that Facebook finds a way to allow children under 13 to legitimately use the Facebook service. As the Economist pointed out, a recent study found that 5.6 million US children under 13 were already using Facebook (and undoubtedly millions more throughout the world). If Facebook does not address this issue, not only are they missing out on a business opportunity, they are leaving themselves open to litigation.
Given this situation, Facebook will almost certainly create a product or option for children under thirteen to have an account, almost certainly with parental approval. I am confident there is a workable solution after seeing how VZnet in Germany launched SchuelerVZ in 2007, a version of their social network that targets students 10-19 (and does not permit older people to use the network). Given Germany’s strong protection of both privacy and children, a similar solution is likely to work for Facebook. Another Economist article details what steps Facebook could take to open itself to under 13s, such as automatically settings their privacy settings to maximum, making their pictures only visible to friends, creating simple parental controls for monitoring and getting parental approval before making any changes to these settings.
What social game companies should do for users under age 13
I wanted to offer some suggestions on what social game companies need to do once Facebook opens to children under 13. Although it is a great opportunity it is also a huge additional responsibility on all of us.
- Obey the law. First, you need to make sure you are obeying COPPA regulations on collecting and disseminating private information on children. As some of you may remember, Playdom was fined $3 million for violating COPPA guidelines (Hollywood Reporter article on Playdom fine).
- Make games that kids and parents WANT to play together. When I was a post-graduate student in Ireland, I was amazed at how parents, grandparents and children would all socialize together at pubs. In the US, kids usually try to avoid spending any time with their parents as they get older. Social games represent a great way to bridge generations, giving family members a real, fun reason to interact with each other. The important thing is to design your games so they are fun for everyone; if you create an experience that parents are only playing so they can be with their kids, it won’t work long-term. Everyone has to enjoy the game (just as they enjoy a pint).
- Create a safe environment. Most of your current players can take care of themselves; kids can’t. You need to ensure that children are not put in situations where they are at risk. If you have any chat or other player-to-player communication, you must monitor it closely; make sure “the bad guys” have no access to kids. Also, do not expose them to potentially inappropriate content or posts.
- Ensure your pricing and monetization strategy is appropriate. If you read my blog regularly, you already know I believe that you should not use manipulative pricing strategies in any market, but it takes on an increased level of importance when dealing with those under 13. Even if you disagree with my philosophy of using pricing to create a bond with users and not just focus on maximizing transactions, you need to ensure both children and parents know when spending real currency and get parental approval. Not only will you deal with multiple charge backs and potential lawsuits by manipulating children into making charges they do not understand or their parents do not approve of, you will lose these children as customers as they or their parents uninstall your game (and probably tell all their friends to do the same.
- Choose the right monetization strategy. Let’s start with the obvious: Most kids under 13 don’t have credit cards. That fact, by itself, will greatly affect monetization. Strategies that work with adults are probably not optimal for those under 13. For example, if you look at sites that target kids (like Club Penguin), the bulk of their monetization is through the subscriptions purchased by parents (no doubt at the urging of their children). The point is you need to see look at children as a different market segment and determine what is most appropriate for this market.
- Watch your advertising and offers. Not only are there much more stringent regulations on advertising to children but you probably want to go above and beyond the law to create an environment that is comfortable both kids and parents. This not only means product placement, but also ads placed via ad networks as well as offer-based payments. Look at Disney, which recently announced it would strictly limit the children’s food advertisers on its children’s networks and at other Disney operations (well beyond what is required by law).
Children under age 13 are important to your company
After reading my recommendations above, you may feel it is not worth the trouble to make age appropriate versions of your games, but I could not disagree more. First, this is a huge potential market of players who are likely to appreciate social game mechanics. With appropriate adjustments to your game (or creating games for this market), it is a significant revenue opportunity. Second, even if these players do not generate huge revenue immediately, you are creating relationships with players whom you can migrate to future games as they age. These are customers you work with for the next 30 or 40 years. If you are truly looking to build a great and sustainable business (and not just flip it in six months), understanding and appreciating this market is a great move.