Rixty and Coinstar are going to run a month-long promotion aimed at getting a broader audience to use Facebook’s new virtual currency.
Rixty lets you get virtual currency when you go to the grocery store and pour your coins into the Coinstar machines, which normally dispense cash or store credit. You can take that virtual currency and spend it on virtual goods in an online game. It’s a great way to enable people who don’t have credit cards to spend money in online games. Rixty helps expand the reach of social games to the “unbanked” or people who prefer not to use credit cards.
Under the promotion, San Francisco-based Rixty and Coinstar will give 10 free Facebook Credits in exchange for trading their coins for a cash voucher at one of 10,000 Coinstar locations, which are usually in grocery stores. That’s about $1 in value. On the back of the voucher ticket, you get a web address that you can enter on your computer. Then you claim your Facebook Credits and can proceed to use them in games and other apps on Facebook. The promotion will run from Aug. 9 to Sept. 7.
Facebook Credits is an extremely important part of Facebook’s plan to make money. The company gets a 30 percent cut of every transaction that takes place using the currency. And it hopes the formal introduction of Credits this summer will be akin to the introduction of the euro currency in Europe, which removed the friction from the system, allowing people to cross borders and buy things without being taxed for the privilege. It resulted in an overall economic boost. Facebook hopes that Facebook Credits will have the same effect, prompting users to fill their virtual wallets. The users can then spend those credits across all Facebook apps. They can also earn Facebook Credits through various promotions, such as the Rixty-Coinstar deal.
In addition to the free Facebook Credits, users can buy Credits by taking their coins to a Coinstar machine and getting a Rixty voucher. They can then use the voucher to buy Facebook Credits and receive a bonus, based on the amount purchased, of up to 105 credits, or $10.50 worth, said Ted Sorom, chief executive of Rixty, in an interview. All sorts of merchants are expected to participate in Facebook’s marketing programs. The merchants can reward users with Facebook Credits for buying certain products.
“We hope to introduce a whole new audience to Facebook Credits,” he said. “As the social games space continues to grow, the need for a seamless prepaid option for Facebook credits will only continue to grow.”
The whole promotion is not unlike other novel marketing programs that combine brick-and-mortar retailers — which have lots of foot traffic — and the virtual economy. Zynga has a cross-promotion deal with 7-Eleven convenience stores where its FarmVille game is promoted on various 7-Eleven products.
Rixty says that roughly 20 percent of U.S. households lack credit cards, but Americans do have about $10 billion in unused coins sitting around the house. The company says about 75 percent of its users use their accounts within 24 hours of creating them. About 70 percent of Rixty users do not have a credit card, and 70 percent are over 18. Rixty was founded in 2007 and raised $1.24 million in January from First Round Capital and Javelin Venture Partners. Rixty’s rivals include Kwedit, Zeus Research and other vendors of prepaid cards. Rixty has 10 employees.