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Summary:

Last week, the Hamburg-based research firm Komjuniti published the first extensive survey of Resident attitudes toward real world marketing in Second Life. It’s been a long time in coming: a British branding agency established a forward operating base in SL back in early 2004 (and for […]

Last week, the Hamburg-based research firm Komjuniti published the first extensive survey of Resident attitudes toward real world marketing in Second Life. It’s been a long time in coming: a British branding agency established a forward operating base in SL back in early 2004 (and for their efforts, were greeted by throngs of sign-waving protesters threatening to boycott their island.)Coke in SL

In succeeding years, a miniature dot com boom has attracted a slew of big name companies and established brands, from MTV and Coke, to Dell, American Apparel, Coldwell Banker, among many more. Up until now, few have asked hard questions about what these companies were gaining for all that effort and cash (other than any publicity hit from the announcement.)

The early results from Komjuniti, as it turns out, are not encouraging: 72% of their 200 respondents [PDF file] said they were disappointed with real world company activities in Second Life; just over 40% considered these efforts a one-off not likely to last.

As bleak as these numbers may seem, it’s worth noting that they aren’t actually too far off from reactions to traditional Internet advertising. For example, four years after Net-based advertising had reached full fury, Yankelovich Parterns conducted a 2004 study and found that 60% of consumers had a significantly more negative opinion of marketing and advertising on the Web now than a few years previous, while 65% described themselves as feeling constantly bombarded by ads online. So in a relatively similar space of time, advertisers and brand promoters in Second Life have managed to annoy their potential customers only slightly more then their established brethren.

More worrying, however, are another pair of numbers: while 41% of respondents in the Yankelovich study said that Internet advertising had at least some relevance to them, a mere 7% of respondents in the Komjuniti study say that the SL-based promotion would have a positive impact on their future buying behavior.

Why has the failure been so thorough? Not necessarily for a lack of desire, because the Komjuniti participants also report “they would like to be able to interact more with the brands represented” in SL; metaverse versions of established hotels and retail brands garner the most positive reaction. These two points offer a sliver of hope to the metaverse marketer. As to the underwhelming results thus far, I can suggest three factors not covered in Komjuniti’s analysis.

Teleporting is to SL Advertising What the Channel Clicker is to TV Ads

The standard means of travel in SL is point-to-point teleportation, near-instantaneous transit from one x,y,z location to another. (Though it gets more press, Superman-esque flying is mostly used in short, localized bursts to get around obstacles.) P2P teleporting renders billboards and most other location-based advertising useless, and in any case, most SL marketers buy and develop on private virtual islands, where they can fully control the branding experience.

Due to server architecture, however, these islands are only accessible by teleportation, making it the ultimate opt-in experience. Giving marketers the unique challenge of getting Residents to voluntary dive into their ad, and stay long enough for any kind of meaningful brand immersion. So it’s not all that surprising marketers are largely floundering in Second Life: it’s like trying to create ads in a 3D Tivo.

Death by Green Dots (or lack thereof)

Residents navigate the world through a dynamic map; in it, every avatar in-world is represented by a green dot, and this feature has become a quick way for getting a visual read on where other Residents are in the world, and what they’re doing. In various locales and islands, green dots congregate in large numbers, and users’ immediate inference is, if lots of people are going to these places, something interesting must be going on there.

Any noticeable clump of green dots attracts more dots, and as those grow, more follow– a feedback loop colloquially known as “the green dot effect”. Second Life’s most successful entrepreneurs (who’ve proven far more agile and inventive then most of their real world counterparts) sustain this flurry of dots by holding constant events, giveaways, and games, and even go so far to pay Residents to visit. Amazingly, corporate marketers have been slow to replicate these homegrown strategies. (Surely several interns can host regular activities at their company’s SL site? Has to beat photocopying and bagel runs.)

A Failure of Imagination

To play in Second Life, corporations must first come to a humbling realization: in the context of the fantastic, their brands as they exist in the real world are boring, banal, and unimaginative. Car companies are trying to compete with college kids who turn a virtualHomegrown car dealership automotive showroom into a 24/7 hiphop dance party, and create lovingly designed muscle cars that fly, and auction off for $2000 in real dollars at charity auctions.

Fashion companies have it even harder. A thriving homegrown industry of avatar clothing design (free of production costs and overseas mass production) already exists, largely ruled by housewives with astounding talent and copious amounts of time, and since the designers are popular personalities in Second Life (whose avatars become their brand), they enjoy– and frankly deserve– the home team advantage. Homegrown SL fashion

Faced with such talented competition, smart marketers should concede defeat, and hire these college kids and housewives to create concept designs and prototypes that re-imagine their brands merged to existing SL-based brands which have already proved themselves in a world of infinite possibility. Or as the Komjuniti study suggests, they can keep building sterile shopping malls, and continue wondering why Residents prefer nude dance parties, giant frogs singing alt-folk rock, and samurai deathmatches– and often, all three at the same time.

  1. It’s a classic case of marketer meets gamer. The two races just don’t get along.

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  2. “extensive” – Are you kidding me? 200 people is extensive?

    SL marketing has a loooong way to go, but I could get 70% of respondees to admit to being a small teapot by asking the right questions.

    Slow news day?

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  3. I take your point and agree that many brands have failed, but Starwood Hotels did a good marketing run in SL.

    Starwood’s story in BW: http://tinyurl.com/ybxkdr

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  4. I for one certainly hope the real-world marketers don’t replicate home-grown methods for the ‘green dot effect’.

    Camping chairs are the scourge of Second Life.

    As long as these companies ‘engage’ the visitors with information, products or just sheer fun, then there should be no problem.

    The most important thing is they ‘understand’ SLers and their needs. Most larger SL agencies employed by the big companies have hired some great talent to define and deploy their brand in world.

    The builds tend to be good quality, but not always the ‘engagement’.

    Many of these islands which are owned by big brands will certainly end up being ‘Virtual Theme Parks’ imho – where the theme IS the brand. So, it’s up to them to avoid that happening. It takes a lot of effort.

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  5. Nice overview for the SE newbie-marketeer, thanks. There definitely seems a lot of space left for out-of-the-box thinking and using user-generated marketing.

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  6. There’s several reasons why real world marketing needs a massive paradigm shift to work in Second Life, some of which are well covered in the article. My take on the major problems is:

    1) The most popular areas by visitor are almost exclusively ‘xxx’ locations where advertising would be almost totally ignored and, amusing though it sounds, I can’t really see a “This Orgy Room is brought to you by Coca-Cola” getting past the company lawyers, but Playboy might not have such a problem!

    2) There is a limit to the benficial effect of the ‘Flash Crowd’ aka the ‘green dot effect’ which is exactly that described by Larry Niven in his 1973 story of the same name – the sim gets laggy at fairly low levels and eventually the tp system stops working. Even if a company gets the Beatles to reform with Jimi Hendrix on guitar to publicise an event in sl, a vanishingly small amount of users would actually be able to attend. Companies need to got back to long, slow campaigns rather than a massive spend on shock and awe tactics. AOL Pointe in sl seems to have grasped that idea, for example.

    3) There is no way to hold onto the idea of copyright and uniqueness between RL and sl. If users want something tangible such as a guitar, a car or an aeroplane to take radical examples, how can the advertisers persude us we want an ‘official’ Fender, Ferrari or LearJet when the means are available to make your own, indistiguishible from the original, or to find someone who can do it for you for small(er) cost.

    Competing against this would either involve the comapnies driving their sl prices close to zero to generate sales or to use the L$ cost of an item against the RL cost, so buying a sl Fender for L$500 gets you a 10% discount against the RL model. Hmm, maybe I should copyright that idea right now…

    4) The companies who could engage best with sl residents i.e the tech and design companies are not exactly thick on the ground. I agree that the existing designers should be allowed to design some sl catwalk shows or expos. And how about running some type of ‘Be a Versace / Gucci model’ like the reality TV versions? Involve the movers and shakers of the sl design world as judges and podcast / blipvert episodic chunks out to YouTube / blog channels…

    Hey, that’s two ideas, maybe I should be a marketeer?

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  7. WJA,

    You know and I know that most of the integrations are being completed by what amounts to a glorified software development shop who have no idea what to do once their builds are completed. On top of that the brands are seduced by the eye candy that these firms produce and don’t bother to dig deep into the issues that matter such as sustainability and ROI (Heck Reub even said last week that we shouldn’t pay attention to ROI in SL. Huh?) and more importantly how to create a positive brand experience that is engaging and will create loyalty amongst the general population.

    I’ve said this time and time again, it’s not the brands that the community dislikes, but rather the experience. On top of that is the worse case scenario that the community has no idea your even there, which boils down to the basic principles of promotion.

    Look at RatePoint. They are a legit corporation albeit a young and hungry start-up. They purchased a significant amount of banner space on your blog, New World Notes, among others, have worked with us to hire an in-world promotion team and built a simple cafe complete with 4-5 live music shows/week just to give the community something cool to do AND have hired residents to manage the cafe and book the artists. In three short weeks they are generating far more traffic than GM, Nissan, Scion, Reebok, Dell, H&R Block, Sony-BMG and every other big corporate giant. To kick a little more dirt in the eyes of the MegaCorps RatePoint is already asking “What can we do to improve this and make it better?” I can tell you, since we built it, their entire SL strategy and execution was completed at a fraction of the cost of what the MegaCorps invested. I don’t know what kind of Kool-Aid they’re being fed, but to them SL might as well be called Jonestown.

    I leave you with this. What’s the point of building the most extravagant and expensive widget in the universe (or in this case metaverse) if nobody knows about it?

    Marc

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  8. Thanks for this great coverage, and critical view of traditional marketing efforts in Second Life! The faster the ‘Trough of Disillusionment’ comes for SL, after the media induced ‘Plateau of Inflated Expectations’, to say it with Gartner, the better it will be. General Virtual Worlds, like Second Life, deserve to be recognized as a maturing platform for social, technological and marketing experimentation, where the interaction has to be very carefully designed or evolved to be sustainable, meaningful, and valuable.

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  9. [...] de marketeers van de bedrijven die recent in Second Life gestapt zijn niet begrijpen hoe je daar iets opbouwt dat de moeite waard is om tijd aan te [...]

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  10. [...] marketeers from established companies do not understand how to build something that is worth spending any time on.“Any noticeable clump of green dots [...]

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