Anyone who has played Zynga games in the past, would be aware of decorations as a theme in the games. Up until now, decorations have been included purely as a means of earning XP, and as visual aesthetics for your farm / pet / town, or whatever you were managing in the game.
Basically, decorations cost you a whole bunch of money, without giving you any real benefit, other than completing tasks and earning you bragging rights. In CityVille, the purchase of decorations has a much more tangible reward. Quite simply, the buildings you buy decorations for, end up with enhanced functionality.
The enhanced features of buildings makes them more efficient. This goes for public buildings as well as businesses. When you decorate your businesses, they earn more money per unit than before. This is very important, since the increased profit is purely passive. There are no extra ongoing costs and more importantly, you do not need to use up as much ground space to earn coins.
Decorating your businesses to increase profits makes sense, since it slows the rate at which you use up real estate in your city. If you cover your city too quickly with individual businesses that earn the standard income, you will end up paying more than you should over time, to increase the size of your city. Make as much money as you can with the ground space available, before being forced to upgrade your city to a larger one.
An example of this increased productivity in action, is demonstrated by adding decorations to your Pool Hall. A standard Pool Hall generates 420 coins. With decorative upgrades, it generates 1391 coins every time you collect from it.
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