Virtual Goods Contribute to Dogster Revenue

Dogster, Inc., has defied expectations by maintaining strong revenue streams despite the ongoing economic downturn. The company maintains Dogster and Catster, a pair of social networks for pets and their owners. Part of the secret to the Dogster, Inc., success story is its in-house ad stream, detailed by VentureBeat, which allows the two sites to establish higher CPMs with advertisers than services like Google Adsense support while also targeting companies specifically interested in selling to pet owners. Another component of Dogster's business model that is less widely-discussed is its virtual goods sales, which according to chief executive Ted Rheingold, comprise about 10 to 20% of the company's revenue in an average month.

Dogster and Catster offer four tiers of virtual goods that users can purchase using zealies, the service's currency. Bones are free and may be given by any user, but last only two weeks. Furever Stars purchased for a pet's profile become permanent additions, and can also take the form of diamonds and rainbow stars. Rosettes stay as part of a pet's profile page for one month. Special gifts are much larger and significantly more expensive images, often seasonal, that last for one month. These gifts all cost from 5 to 20 zealies.

Dogster and Catster users who opt to pay for an enhanced Dogster Plus account, which costs $19.95 per year, accrue 30 free zealies per month and can purchase special gifts at a discounted rate. Users can also earn "free" zealies by playing the Dog Breed and Cat Breed games on-site, and by participating in site activities like a weekly photo caption contest. Otherwise, zealies can only be acquired as a gift from another member, or purchased online at a rate of 20 zealies for $5.00. Purchasing in amounts of 100, 200, or 400 zealies at once nets extra bonus zealies for a user.

Dogster, Inc. is occasionally able to integrate its in-house advertising promotions with its virtual gift system. Companies who wish to advertise on Dogster and Catster sometimes do so by placing a branded gift in the gift store that users may give to others freely. These gifts last until the promotional period expires. Recent examples include a Febreeze branded collar that was part of a larger Febreeze promotion that offered a free sample of the product to Dogster and Catster users.