Farmville treeconomics: is this going too far?

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The farmville date tree. Fill a square with 16 of them and you have a great investment.
The farmville date tree. Fill a square with 16 of them and you have a great investment.

Fred Wilson blogged recently about Zynga, the #1 social gaming company, looking for talent  in Wall Street. He should know, he’s a Managing Partner at Union Square Ventures, one of the VC firms backing the company. I am sure that to many this might seem strange but it shouldn’t. You can put an MBA to good use just to play Farmville.

Adam Nash did just that. He took Farmville economics a step further in his last two posts and Lisa Chan at Zynga took good note of it. The next task in his list is figuring out the economics of trees. I thought I would give it a try.

Like in any financial model we’ll start with a couple of assumptions:

  • Investment period and residual value: like Adam said, people will not be playing Farmville in 2020. Given that the “investment cycle” is daily I thought it was fair to assume that the tree is sold for its residual value after 90 days.
  • Discount rate: I’m a huge supporter of using the NPV investment rule. The problem with this is, like I said, that we have to now find an adequate discount rate. To simplify and given that Adam’s initial analysis was not done on a bang per buck basis, I’ll just do a comparison of investments.
  • Available investments: I still need to level up! Also other trees are available as gifts but cannot be purchased. I’ll base the analysis on the trees I have available to purchase.

First we’ll compare the trees among themselves to see which one has the highest daily revenue:

Cost Revenue/Harvest Days to Harvest Daily Revenue Daily Rev/ Invested $ Days to Payback
Date $800.0 $69.0 3 $23.00 2.88% 35
Lime $750.0 $75.0 5 $15.00 2.00% 50
Lemon $475.0 $41.0 3 $13.67 2.88% 35
Peach $500.0 $47.0 4 $11.75 2.35% 43
Fig $350.0 $33.0 3 $11.00 3.14% 32
Plum $350.0 $30.0 3 $10.00 2.86% 35
Orange $425.0 $40.0 4 $10.00 2.35% 43
Apple $325.0 $28.0 3 $9.33 2.87% 35
Cherry $225.0 $18.0 2 $9.00 4.00% 25

The date tree is the winner, but if we were to rank it on a daily revenue per dolar spent basis (bang per buck) it would look quite different:

Cost Revenue/Harvest Days to Harvest Daily Revenue Daily Rev/ Invested $ Days to Payback
Cherry $225.0 $18.0 2 $9.00 4.00% 25
Fig $350.0 $33.0 3 $11.00 3.14% 32
Lemon $475.0 $41.0 3 $13.67 2.88% 35
Date $800.0 $69.0 3 $23.00 2.88% 35
Apple $325.0 $28.0 3 $9.33 2.87% 35
Plum $350.0 $30.0 3 $10.00 2.86% 35
Orange $425.0 $40.0 4 $10.00 2.35% 43
Peach $500.0 $47.0 4 $11.75 2.35% 43
Lime $750.0 $75.0 5 $15.00 2.00% 50

As a side note, also the crops would look different on a bang per buck basis:

Daily Investment Daily Profit Daily Rev/ Invested $
Super Berries 300.0 900 300.0%
Watermelon 36.3 51 140.0%
Artichokes 21.3 30 140.0%
Wheat 16.7 22 130.0%
Cotton 30.0 39 130.0%
Pineapples 55.0 66 120.0%
Yellow Bell 45.0 54 120.0%
Squash 27.5 33 120.0%
Eggplant 20.0 24 120.0%
Soybean 30.0 33 110.0%
Pepper 85.0 77 90.6%
Rice 120.0 72 60.0%
Pumpkin 135.0 69 51.1%
Blueberries 390.0 156 40.0%
Strawberries 150.0 60 40.0%
Raspberry 420.0 132 31.4%

Back to our analysis. Let’s compare a 90 day investment in a square full of date trees with some crops. Believe it or not, 16 date trees can be squeezed in a square.

Daily Profit Total Profit Initial investment Residual Value Profit
Super Berries $900.0 $81,000.0 $81,000.0
Date tree square $368.0 $33,120.0 $12,800 $640.0 $20,960.0
Tomatoes $174.0 $15,660.0 $15,660.0
Raspberries $132.0 $11,880.0 $11,880.0

Does a date tree square make sense? Sure. The catch? A square full of date trees costs 12,800 coins, you need 35 days just to pay the investment back. If you are looking to optimize your farm on a per square basis it’s perfect. Given that space and not coins is the key constrain in Farmville, it does make sense. Also, the longer the investment period, the better it will look.

Is this over-analyzing and going too far? Maybe, but in a blog about digital media, gaming, VC and randomness, this post fits great. If you need financial modeling to Excel at these games (pun intended), you do need to look in Wall Street to manage them.

Update: you can now see the analysis for Farmville animals here.

Super Berries 300.0 900 300.0%
Watermelon 36.3 51 140.0%
Artichokes 21.3 30 140.0%
Wheat 16.7 22 130.0%
Cotton 30.0 39 130.0%
Pinneaples 55.0 66 120.0%
Yellow Bell 45.0 54 120.0%
Squash 27.5 33 120.0%
Eggplant 20.0 24 120.0%
Soybean 30.0 33 110.0%
Pepper 85.0 77 90.6%
Rice 120.0 72 60.0%
Pumpkin 135.0 69 51.1%
Blueberries 390.0 156 40.0%
Strawberries 150.0 60 40.0%
Raspberry 420.0 132 31.4%

52 comments

  1. Adam Nash

    Wow. This is great. I’m going to point to it on my blog – excellent analysis.

    I think if you start factoring in Experience, trees don’t look quite as good. But seeing the date tree square is very interesting.

    I think looking at the yield of each crop is an interesting way to look at the data as well.

    Great job.
    Adam

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  4. Chris W.

    I lost interest after I realized this had nothing to do with how to succeed at online dating.

  5. Scott Gerhardt

    It’s nice to see some other people running the numbers and looking at this game in both a short and long term financial sense. Now of course, there are a few other factors you have to look at. This article generally assumes having a near unlimited cashflow to begin with. Should your cashflow be limited early, them obviously you need to find a way to maximize your short term flow while consistently using most or all of your liquid resources to do it (making your money work for you).

    In the mid-to-late game when you’re stockpiling money and can plant/grow/pet just about anything you want, you have a few other factors to look at. One of course is the level you’re at. Should you be sitting on level 35 with nothing else out there to get, then running the “Date Farm” is undoubtedly the right play, being careful not to overplant since you can expect the game will be expanding and 35 won’t always be the “cap”. Less than 35 and you start to factor in the XP as well. Where are you, how often can you plant, and what are your goals. If it’s to hit the level “cap” as fast as possible, then you ignore the dates and focus on the high XP yield crops, like Blueberries and Sunflowers. If you have the time and are looking for a hybrid yield, Tomatoes are best. You have to watch them closely, though, because while their hourly yield is the best prior to level 30 (I’m only at 28 so I don’t really know the top crops yet), their “realisitc yield”, or factoring in two hours on the end of maturization time to accomidate for real world things that prevent you from playing the game non-stop, is considerably less then Sunflowers and their XP yield is already only half of Blueberries.

    On the whole, though, a very nice blog over the simple number crunching that gives a lot of people headaches in this game. Well done.

    • ppaniagua

      Great points Scott, thank you very much. XP would definitely be the next element to bring into the analysis.

  6. chrisweed

    I do remember playing a similar game in economics class which simulated running a company that sold “echo-pens”, a then pie-in-the-sky technology that could record what you write. These actually exist now, but that is beside the point. A dork like myself enjoyed adjusting my companies production, r&d, marketing, and pricing to try to out compete my fellow class-mates. I invariably won by picking the most extreme business model of high-quality or high-quantity. (ie the tiffany’s vs. walmart model)

    I thought this was pretty cool, until they had a stock-picking competition in which I picked a winner (Intuit announced they were getting bought by Microsoft) The buy-out never happened, but I won the stock picking competition. From that point I was hooked.

    • ppaniagua

      I wonder if those simulations still make sense or professors will just start using games on Facebook to make their points :D

  7. Joram

    Would you believe, the sad this is I made a spreadsheet with all these figures about 3 weeks ago… nope not to share and be interesting, but just to beat my wife at farmville…

  8. Nora

    You’re missing a lot of trees including banana, pomegranate, passion fruit and grapefruit.

    • ppaniagua

      Thank you Nora. Unfortunately those trees can´t be bought, only sent as gifts, so we can´t do an investment analysis for them. But a gift is always good!

  9. Chris Marinio

    Nice. Late to this thread (and pretty new to FarmVille), but the obvious next step is for their to be a yield based on XP, crop rotation, market prices for the harvest. From there, a futures market to hedge. Biofuel crop substution, etc. A veritable argabiz.

  10. Jack Farmer

    Two extra points in this fantastic, but highly addictive strategy game:
    !!! The game is a changing environment. Just like in real life. !!!
    Today, date trees are out of the game. (I hope they will be back, because my current strategy is based on them, but it is.
    !!! Time issues are crucial and more and more crucial in higher levels. !!!
    Harvesting 18x18x16 date trees takes some time: 5 hours at least.

    • ppaniagua

      I miss the dates too :)

      Time management becomes important. Although I like harvesting each tree only every 3 days it is a shame there is no tractor/harvester/seeder for them.

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  12. Eruvis

    here are some of my thoughts on the whole trees being good for long term thing: of course these numbers may be wrong so if you find mistakes dont overly kill me for it.

    tomatoes are 7.25 profit per hour

    let us consider lime trees and date trees.

    lime
    5 days, 75$

    15$ per day, 0.625 per hour.
    to equal tomato plant, you will need:
    7.25/0.625 = 11.6 trees per square

    i just tried moving my trees onto a plot and it was a disaster!
    seriously you cannot pick more than a few trees comfortably, you will lose too much time trying to harvest, there is no way in hell that you will pick 11 trees.

    date
    3 days, 69$
    23$ per day, 0.96 per hour
    7.25/0.96 = 7.6

    now, maybe, MAYBE you can pick 8 dates per square.

    my conclusion is this: if you think you can fill your farm with trees, you will need: 20*20*750 for lime, = 2,400,000, which is 35*20*20*173 (35 harvests on a 20×20 farm of tomatoes)

    assuming you actually do this, and buy all the trees, that calculation is for 8 trees per square (8*400 = 3200 trees)

    this is
    15$ per day per tree, 0.625 per hour per tree, x8 = 5$ per patch of 8 trees, 2000 per hour per 400 squares on a farm, 48000 per day, but 240,000 at the end of a 5 day picking cycle IF you can pick 3200 trees.

    now to make 48000 per day, we can also do this:

    make 48000/400 squares = 120$ profit per square. per day which is 5$ per hour crops. any 5$ per hour crop therefore will beat 3200 lime trees. this means you can make 58$ profit off tomatoes and pick them every 11 hours and still make 5.2/hr

    adding in that you get no exp for trees, i dont really see trees being of any use for cash or exp, EVEN IF you get 3200 date trees gifted,

    3200 date trees = 73600$ per day
    73600 / 400 = 184$ per square

    184 / 24 = 7.67$/hr.

    now, IF you can do this, dates will beat tomatoes (tomatoes are 7.25/hr)

    downsides: no exp, and you’ll have to wait 3 days for 220,800 instead of getting 23,200 per 8 hours with tomatoes (which is 208,800 if you pick 9 sets of tomatoes in 72 hours) a loss of 12,000 per 3 days or 166.67 per hour.

    this is not that well organised but i hope it is useful to at least some people.

    also to add to my (any 5$ per hour crop) thing:
    besides 2x tomatoes at 11 hours each you can plant:

    carrots, coffee, sunflowers, 12/16/24 hours if you have the right levels but right now i am not high enough to use anything besides tomatoes and carrots

    • ppaniagua

      Thanks for the comment Eruvis. Your math is good, I liked the idea of calculating how many trees you need to match Tomatoes, the best performing crop. Indeed, if instead of putting 16 trees per square you put 8, it won’t work great.

      Harvesting many trees into a square is difficult. I would only move identical trees together. They create a pattern that makes it easier to harvest. But you will need to be totally zoomed in.

    • SgtNessola

      You forgot to take into account that the fruit on trees never rot. Should you have any issues that prevent you from harvesting you don’t lose your entire investment in both plowing and seed stock.

      I did like the point about picking 3200 trees. However, if you staggered the planting over a period of time, you’d be able to pick say, a third of the total per day, or something similar.

  13. Sarah

    Harvesting trees as long as they are arranged by variety is not difficult but just time-consuming – which is what is making me get bored of these games unfortunately…

  14. Linda

    I am not sure who to ask. Why don’t the designers in Farmville make more items to be able to rotate directions? Like wheelbarrow, ponds, gazebos etc. They need to invent bricks or stone pathwys, ability to plant flowers around borders and earn money etc. Create more animals like a donkey, birds, geese, rooster, weather vein etc.

  15. gsel

    Could I ask question, what happen to my farmville I encountered problems like this” out of sync” what I must to do. I’am a fanatic in farmville help me…send my reply on sel722@gmail.com

  16. Parimala Alva

    I recently started using the Farmville application on Facebook and was just beginning to figure things out. unfortunately I didnt harvest my crops for two days and by the time i logged in all my crops had dried up :( .I am getting addicted to the game now and would gobble up any information on it. Thanks for this blog. Very good analysis.

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  18. Marta A.

    I did my own analysis of profit per hour for crops (I’m a former CPA-now on disability). It was a simple process and has made a big difference in how I plant my crops and arrange planting/harvesting around my other daily plans. I love that I play this game with my 13 year old daughter (I just turned 50), her friends, my friends . . . and now my husband wants me to help him set up his farm. How amazing is it to find a game that appeals to such a wide range of users and a computer application that is actually bringing a family TOGETHER! Many thanks to the developers of FarmVille. Just keep more choices coming . . . I wish there was a greater variety of animals to purchase & I hope the program keeps growing with the farmers. How about pets??

  19. Lorraine parker

    I wish you could give more FV points when you get to the higher levels. It takes so long in between the levels , after 20. I don`t want to bring out the credit card out for a game. Thanks’

  20. Kim Guinn

    I thought I was over the top with my farming, but you have me beat! Cool blog… Do you happen to know how to get fertilizer? There’s a new ribbon for fertilizing your neighbor’s farm, but I don’t know where to get fertilizer???

  21. Hannes Reyneke

    I recently found out a great way to get XP fast with a lot of effort but not a lot of coins. If you delete a few plots, about 30, it will be sufficient for you to do this. Buy hay bales for 100 coins each and place them in the space that you have reserved for it. With this new function of Farmville where you can buy hay bales without going to the market every time works wonders. Each hay bale you will purchase is worth 5XP and if you will sell it again after you run out of space, you will receive 5coins for it. This means if you want 1000XP, it will cost you (1000 devide by 5 = 200 hay bales, which will cost you 100coins each and you will sell them for 5 coins, which gives you 95 coins in total. So 95coins X 200 hay bales) 19000 coins. This will get you through the levels in no time with a bit of effort.

  22. Maureen

    Recently purchased a solar powered plower, but am wondering why I did this. You can plow 4 at a time anyway. This concerns me a little as I wonder if FarmVille will soon be charging for gas too!

  23. emelyn gernale

    why is it that not everyone can have those flower shed. I love to have it. My niece has it but not me. huhuhu Please let everyone have those flower shed. thanks:)

  24. Glenn Fuller

    Congrats to FARMVILLE!!! I hope the record number of users is not representative of the unemployment rate.

  25. Sarah

    Why can we only have one chicken coop but unlimited dairy barns? Collecting eggs one by one is a pain. We should be able to buy more than one

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  27. melis

    where do we find the answers to these questions..would love to learn how to get to the next level faster and get farmville coins and most of all..stop the issues like coming back and finding myself back a level..instead of up..I got to 25 with hard work..came back and now I am back to 24..grrrr how do we stop that and still earn money?? help

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  30. Dale Smith

    Human creativity and aggregate economic behavior is illustrated by Farmville players. I play because my wife asked me to be her neighbor. Later she questioned my reasoning on running my virtual farm the I did. I told her I “churn the dirt” to earn XPs and coins. Others I know like to “decorate” their farms with villas and park benches, which to my mind only produces costs, not revenues. Even in a game the un-seen hand can be observed.

  31. Karius

    Although i like the analisis of games as well, it strikes me as odd to utilize the NPV method.

    To me i would rather be more promising to go for factors time and space. Many Bloggers did that. The next step i’d take would be the individuals preferences.

    Like risk seeking and risk averse behaviour in finance it seems logical to assume mainly time preferences, not considering any esthetic preferences. (The only preference my girlfriend would have ;) )

    So my tables would come down to:
    Bucks per timeunit (normal) and
    Bucks per klick

    Now considering that trees only give XP one time you have to consider as well the xp factor. Tables will be needed for this as well. Without an asessment you won’t be able to determine a good strategy.

    (General strategy can be leveling or amassing money that further complicates a easy suggestion on tactics.)

    Now considering the huge initial investment that trees have and therefore there relativly long amortization period, they absolutly kill your XP per timeunit ratio.

    So now that i have to decide to go with at least some crops my daytime preferences kick in. Unbelievable as it is i am sleeping a good deal of my lifetime. So over night it will be a healthy 8 hours plus crop. Most people work, so there will be at least another 8 hours plus crop and only the rest of the time you can spend on going to more promising crop types so they exist.

    I miss duration grouped bucks per timeunit tables as they should be interesting. But that problem is not so severe as i can go through otherwise sorted lists.

    Now having said that. The reason to go for trees only can be a bucks per click ratio and the freedom of trees not withering.

    And thats exactly the reason i am planting trees.
    - I want to have an long term investment that brings me bankable cash.
    - I want to lower my clicking need
    - I want to raise the freefuel per cropspace ratio

    But i would never go for trees only as the game for me inherits leveling as well.

    Hopefully thats not to much text, but i should’ve covered some aspects that might me important when it comes down to evaluation of benefits.

    (Now being at the end, i have to add, not only is the clicking a constraint, but also time needed for action as you would have to consider loading times and execution times. Bucks per onlinetime could be a great measure if you go into details. :P )

    Last but not least, english is not my motherlanguage so forgive me i used some of the word i a way they are usally not utilized.