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Advertisers Can Find Second Life in Metaverses

  |  August 15, 2006   |  Comments

Alternative worlds offer advertisers alternative options.

As I wrote last month, it's time to delve deeper into the advertising opportunities that the virtual gaming world represents for confident consumer brands. Earlier this summer, Steve Rubel, who runs the blog Micropersuasion, posted a story titled "Retailer Opens Outpost in Second Life." It details how American Apparel opened its first virtual store in Second Life. Participants can buy "virtual clothes" for their avatars for what is essentially real money.

Others quickly jumped into the virtual world including Duran Duran, who will play in-world concerts; Starwood, which is beta testing its new "Aloft" hotel brand (similar to W Hotels); and Major League Baseball, which held a nearly live feed of the home run derby in a new Second Life baseball stadium.

What is Second Life? It's a virtual world and role-playing game completely owned and created by the participants. Linden Lab (located in San Francisco) created the game. In this alternate world, personalized avatars, representing each player, interact to find and create entertainment, experiences, and opportunity.

When I asked Chad Stoller, our executive director of emerging media, about the trend, he said, "Second Life and "metaverses" are moving up the list of places digital marketers want to be. Not only do these worlds give all brands the chance to connect with their constituents within a social construct, they also represent platforms where brands can enable players of the games with services, products, and experiences."

He's right. The opportunity is real and the audience is growing both, in Second Life and the World of Warcraft, the two largest metaverses. Om Malik, of GigaOm, presented growth figures on his blog for these mediums: "Former Second Life staffer Rueben Steiger crunches the numbers on Second Life's growth, and figures if the current rate of 22 percent monthly growth continues, there will be 3.6 million Second Lifers by July 2007. Slower growth, say 10 percent every month, stills bring the total number to Second Life to about 936,000 residents. GigaOM contributing writer Wagner James Au goes further and estimates by 2008, Second Life could eclipse World of Warcraft in terms of users."

According to a recent article, the Second Life audience is mostly comprised of stay-at-home mom's and young professionals, not young teens as you might think.

That explains why there are about $5.3 million in user transactions over the course of a month in Second Life. Players can purchase virtual products such as homes, real estate, clothing, accessories, game services (ie: enhancements to communication system, etc) and pay for them with real dollars via a currency system. Second Life uses "linden dollars," which players buy with real dollars to conduct business with vendors within the game. Once the vendor decides to "cash out," their linden dollars are converted back to U.S. currency (after Linden takes their fee).

But people aren't just buying goods -- they're also building viable virtual businesses that provide them with real income. In fact, according to Forbes, there are people making six and seven-figure incomes within the Second Life economy.

If Second Life was on the periphery of your marketing initiatives, as blogs or social networks might have been a year ago, it's now time to take a closer look at the opportunities and risks associated with this experiential medium.

Metaverses offer brands opportunities to:

  • Express brand image and values through an experiential medium
  • Demonstrate new products and services in a truly interactive fashion
  • Put brand assets and images in the hands of interested consumers
  • Build word-of-mouth through an early adopter community
  • Realize new revenue opportunities
  • Receive fast feedback on new ideas and services
  • Provide value back to customers through branded entertainment

Sign up for Second Life and take a look.

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Mark Kingdon Mark Kingdon joined Organic as CEO in 2001 and has led the company to its current position as a leading digital marketing agency. Prior to Organic, Mark worked for Idealab and provided strategic guidance to emerging companies. Earlier, he was a partner at PricewaterhouseCoopers, where he led the America's retail and distribution industry practice and managed the PWC and Lybrand merger and was a leader in the e-business practice globally. Mark is a member of the International Academy of Digital Arts and Sciences and serves as a Webby judge. He's also a regular contributor to Three Minds, Organic's blog. Mark received his MBA from the Wharton School of Business and a BA in Economics from UCLA.

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