Archive for the ‘virtual worlds’ Category

Marketers And Virtual Worlds: Still More Questions Than Answers

April 2, 2008

Media Post Publications

 by Tameka Kee, Friday, Mar 14, 2008 7:00 AM ET

FOR SOME BRANDS, HARNESSING THE power of virtual worlds–or even just the idea of crafting a marketing campaign focused on one–is an immobilizing prospect.


“Enterprises are still getting used to working with social networks where they can’t control what users say or do with the brand,” said Ed Moran, Deloitte Services’ director of product innovation for technology, media and communications. “So when you introduce the idea of a game or virtual world, it’s difficult for them to accept.”

Still, the promise and popularity of virtual worlds is undeniable. This year, about a third of the more than 34 million child and teen Internet users in the U.S. will visit virtual worlds at least once a month, according to eMarketer–and though mainstream frenzy over properties like Club Penguin, Second Life and others has died down, marketers are still hungry for answers about how to effectively use them to reach kids and adults.

So at McGraw Hill’s Media Summit New York on Thursday, Moran and other executives pieced together a three-step roadmap for marketers in search of virtual world success.

First, don’t get bogged down in the planning stage–and don’t bring too many talking heads to the table. “Getting a huge committee together is a guarantee for a mediocre product,” said Matt Bostwick, senior vice president of franchise development, MTV Music Group. “You should start out with a small group of passionate, dedicated people that have support at the C-level, but can just get out there and create a vision.”

Bostwick said that when his team planned to launch the Virtual Hills and Virtual Pimp My Ride properties in conjunction with Gaia Online, they knew that the higher-level executives would have deemed the platform too juvenile. “So we just did it, came back and showed them the sponsorships and user numbers, and they said: ‘We can’t argue with what the audience wants,'” Bostwick said.

Don’t go it alone–it’s better to partner with a firm that has already invested the millions of dollars on R&D and support. For example, Sony’s upcoming massively multiplayer online (MMO) game “Free Realms” has racked up about $25 million in costs, including marketing and development, according to John Needham, CFO and senior vice president, Sony Online Entertainment.

According to Craig Sherman, CEO of Gaia Online, it’s hard to start from scratch. “We spent $35 million to get started and an average of $25 million on an annual basis to maintain Gaia,” Sherman said. “But if someone wants to do something with us, they only have to spend a fraction of that.” Sherman said that partnerships and campaigns on Gaia typically ran in the $100,000-$500,000 range.

And lastly, be prepared to fail. “You don’t just create a branded world or launch a sponsorship and let it sit there,” Bostwick said. “You don’t know until you try what the actual response is going to be.”

Sherman agreed. “It’s about how you react to the data,” he said. “You build it, test it and find out what happens. A lot of the people who did stuff in Second Life learned things even if it wasn’t ‘successful’ by traditional standards.”




Crayon Claims To Be First SecondLife Company

October 23, 2006

Virtual reality service SecondLife must be loving all of the positive press it’s receiving lately. After raising another $11 million in funding earlier this year (bringing their total to $19 million), they celebrated their third birthday and recently announced their 1,000,000th user registration. Putting the recent database hack aside, SecondLife is clearly hitting its stride.

A robust virtual economy has blossomed on SecondLife as well. At least three thousand users make at least $20,000 per year on SecondLife, selling everything from clothes to body parts to real estate. The economy of SecondLife has been estimated to be $64 million per year. Real world businesses are sniffing around the service as well. Wells Fargo, for example, has created its own branded island in Second Life.

SecondLife puts current statistics right up on the home page (stats as on 1:30 pm on Sunday October 22 are to left). Nearly half a million users have logged on in the last 60 days, and $441,948 has been spent in the last 24 hours.

With all of this real money floating around the SecondLife economy, look for more businesses to set up shop. And look for other companies to be selling advice to these new businesses. Crayon is launching later this week, claiming to be the first company to be launched in SecondLife. They will be a virtual consulting firm, facilitating “conversation and transformation above communication. Our value proposition is designed to activate passions, enthusiasm, organic dialogue and no-strings-attached referrals and recommendations.” If Crayon can turn that marketing-speak into understandable advice and guidance to companies looking to leverage SecondLife as a marketing or sales channel, they may find being one of the first to set up shop is a big advantage.

More on this as details emerge. Crayon says they’ll launch this Thursday, October 26.

Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.

Crayon Claims To Be First SecondLife Company

Second Life Hist One Million Online Residents

October 19, 2006


Second Life, the online 3-D virtual world where you can develop your own real estate and design your own clothing, hit one million registered residents today.  About 40 percent have actually logged on in the last two months, more than 10,000 are on at any given time, and the equivalent of $455,000 changed hands in just the past 24 hours.

This thing just keeps getting bigger, especially as people get more the more powerful computers needed to even log on.  In fact, I think that’s the main thing holding it back.  Windows Vista will be good for Second Life.

BIG Media companies gets Second Life

October 18, 2006

On Oct. 17, a new edifice will rise up in the midst of the sprawling online virtual world Second Life. On a 1-acre lot, you’ll find the digitized headquarters of Wired magazine. Garish neon-pink sliding doors lead to a conference room shaped like a Shuttle PC where as many as 50 people can sit on chairs that resemble circuit breakers and watch a screen that looks like a graphics card.

Still can’t find it? Just look near the offices of CNET Networks (CNET), which on Sept. 26 unveiled its own five-story, glass-and-brick office structure in Second Life. The building is an exact replica of the company’s headquarters in San Francisco, and it’s set amid vast lawns overlooking Second Life’s blue ocean. Look closely at that ocean and you’ll see the island purchased by British news giant Reuters (RTRSY), which made its Second Life debut on Oct. 16.

Big media’s land grab is well under way in Second Life, the online realm where real people, under the guise of avatars, mill and mingle and, in some cases, make a living. The game’s audience, swiftly approaching 1 million, is growing at about 38% month over month, according to its creator, Linden Lab. The outfit expects to add 200,000 to 250,000 new players—many of them the coveted younger early adopters—in October alone. “Second Life is almost a phenomenon like YouTube, it’s reached critical mass,” says Chris Baker, senior associate editor at Wired magazine.


And like so many other companies already setting up shop in Second Life, news organizations and other media outlets don’t want to be left behind. As the virtual world grows up in the coming 12 months, it’s only going to get more attractive to companies that want to send a multimedia message. “Everyone’s been searching for the killer broadband offering, and this is it,” says Justin Bovington, CEO of Rivers Run Red, which helps companies like BBC Radio One create events and design buildings inside Second Life.

Simply put, companies as varied as Adidas, Sun Microsystems (SUNW), and Toyota (TM) want to promote their products and ensure their brands are getting exposure amid the consumers, many of them young, who are spending increasingly long stretches not just on the Internet, but immersed in virtual worlds. In-game advertising revenue in the U.S. is expected to rise from $186 million in 2005 to $875 million in 2009, according to
Yankee Group.

Media companies even face competition from virtual upstarts inside Second Life, including New World Notes and SL Herald. Reuters commissioned its longtime tech reporter, Adam Pasick, to cover Second Life full-time and act as Reuters’ Second Life bureau chief. Pasick’s avatar sports a green shirt, a grim business-like expression, and a press badge. One of his first stories reported on a U.S. congressional committee’s investigation of online virtual economies like Second Life and Vivendi Universal’s World of Warcraft and how virtual assets and income received in the games should be taxed.


Another Reuters story is an interview with the virtual president of Second Life’s most popular bank, Ginko Financial.

The Reuters site also offers a variety of market information, such as the exchange rate between the Linden dollar, a currency used in Second Life, and the U.S. dollar. Another table tracks the number of U.S. dollars ($404,063, at recent count) spent by players on Second Life in the past 24 hours. “Second Life is a really hot economy,” says Pasick, who, in the game, goes under the name of Adam Reuters. “It was a natural for Reuters.”

CNET views Second Life as another way to promote its regular online features. Last week, it hosted server maker Sun Microsystems in its virtual conference room, housing 60 people; the event was standing room only. On Oct. 16, CNET held a similar Q&A session, giving Second Life attendees an opportunity to ask questions of the CEO of Linden Labs.

In coming months, the news outfit also plans to make its writers available for online sessions to talk about breaking news stories and reviews, says Daniel Terdiman, a CNET senior writer who is working on the Second Life project. Presentations expected to be posted to Second Life once a week may also include videos and podcasts.


Wired, meanwhile, unveiled its building in Second Life to kick off a package of stories on the game published Oct. 17. The company expects to use its new virtual building to let writers chat with one another and to host three or four virtual Q&A events a
month with real-world as well as Second Life notables, says Baker. “It’s kind of a toe in the water for us,” he says, adding that Wired is also actively looking to set up in other virtual worlds as well. “We are still not sure how to make use of this space; this is the test
case,” he says.

There could be plenty of other opportunities for testing. Bovington predicts that the likes of Microsoft (MSFT) and Google (GOOG) will jump into the game with similar visual Web offerings. Then there are existing virtual worlds besides Second Life, including
and World of Warcraft.

Unlike the latter, Second Life offers more features and options for businesses, says Bovington. “We are this canvas that allows companies
to do what they want to do in Second Life,” says David Fleck, Linden’s
vice-president of marketing. “It mimics real life much more

Click here to see how companies are using Second Life to promote their products and brands.