Zynga Ad Business is in Decline

It seems like social gaming giant is struggling to monetize its large fan base. According to AdWeek, Zynga’s ad business saw a revenue shrink of 24% compared to the last quarter. On top of that, Zynga’s online game revenue fell 1%, officially slipping into net loss territory. Ouch.

The news for Zynga doesn’t get better from here. From AdWeek:

At first glance Zynga’s life raft appears to be its user base. During Wednesday’s earnings call, Zynga CEO Mark Pincus touted the company’s 311 million monthly users. But only a fraction of those users play games daily. Zynga may have added 10 percent more daily active users (DAUs) since last year, but it lost 12 million DAUs from the previous quarter, ending up with an average daily user base of 60 million consumers in Q3.

…perhaps even more troubling than Zynga’s shrinking pool of paying users is the declining amount of money the company is able to earn from each individual daily user. That figure dropped 19 percent to an average of just $0.047 per user.

Do you think Zynga is on the decline? Do you think that they’ll bounce back?


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