Offerpal reports itself to be the leading platform for the monetization of social networks. Their key service is the ability to give points to people who are willing to participate in research or advertising. The participants then use these points to buy software, games or other bit-based goods. The developers and artists who created those goods can then turn points into money retrieved from Offerpal who has been paid by the companies wanting the research or advertising done. I think this brilliant use of a point system as an unregulated "currency" - not only provides the community with value, but creates a scalable mechanism which will allow some of the over $600 billion in advertising and promotion which we spend in this country, to flow into the social media space. Where does that money come from? Well, the collective promotional budgets of companies operating in the United States is estimated to be over $300 Billion, and advertising is at the same magnitude which means just these two investments in demand creation are more than three times the GDP of Romania (which has 22 million inhabitants). The vast majority of that money is spent in traditional ways, including the free standing insert of coupons you get in your Sunday paper.
Over the years, I have heard of many ideas on how to refocus that money in new ways. Do you remember the company Free PC, that was ready to give you a free personal computer if you watched enough ads? Most of these ideas ended up in the intellectual trash bin. But points are that maddening currency that millions of people crave. People are downright irrational about their point balance. Many of us have myriad "point" accounts - some for our credit cards, other for airlines, others for stores. There are trillions of points given out every year.
The cool thing about what Offerpal is doing is that is allows for promotional dollars to flow to attention in the social network economy. Furthermore, it enables folks to "give" points or gifts based on points, and that can be very powerful. The notion of a gift culture in the context of a social network can get real legs. Recently, there was a report of a person driving through Starbucks drive-through, and paid for the person behind them. This daisy chain of gifting lasted the entire day and through the next morning. Such spontaneous gift giving seems to spring out occasionally in different parts of the country. Likewise, gifting with points, and other "earned" tokens can be a powerful way to connect on line. Heck, the "virtual gift" market of digital gift boxes and good will tokens is already over a $50 million business of Facebook.
We can expect more points to erupt because strong social groups often birth their own currency for status and exchange, and money in the social world can be so cumbersome that points may be the grease, and convenient translation to turn attention into $$$. Google should buy them as a way to turn the attention in the social media realm into yet another advertising based revenue stream