Article from Tracy L. Tuten, author of Advertising 2.0

The following article was contributed by Dr. Tracy Tuten, author of Advertising 2.0: Social Media Marketing in a Web 2.0 World. Dr. Tuten is Associate Professor of Marketing at Longwood University. Her research interests include Web-based survey methods, branding and identity, and online advertising. She serves on the editorial review board for Psychology and Marketing.
Lessons Learned from Second Life Virtual worlds give participants an opportunity to be whoever they want, wish or hope to be. With a custom designed "avatar," you can look, behave and speak any way you want. It's your "second life," after all. Brands, however, don't have that luxury. They bring established reputations and perceptions into a realm where everything is new and anything goes. The "Wild West" nature of virtual worlds frightens brand managers schooled in carefully crafted and controlled messages, and Second Life indeed chased many away. But with technology -- and especially social media -- becoming more and more pervasive in consumers' lives, virtual worlds will get a second chance. Here's how to capitalize on it. Second Life and other virtual worlds have enormous branding opportunities. In terms of social media, virtual worlds really are communities in the most literal sense, and it is the level of interaction and engagement that creates such a strong platform for branding. Some brands (like Vodaphone) have found ways to develop interactive spaces in world that intrigue and engage prospective customers. For these brands, virtual world marketing is much like participating in a sponsorship: the presence is valuable if there's a good fit between the space, the target market and the brand -- and if the brand can find a way to add value for those visiting the space. For some brands, though, virtual worlds are not the most friendly of communities. They may find that other forms of social media marketing are better suited -- or at least simpler to manage (particularly if the virtual world in question is Second Life)! Here are a few factors that can help you understand "why" . . . or "why not." Ease of Use Second Life is complex and user-unfriendly. Time magazine called it a case of Fortune 500 companies trying too hard to be hip. A recent report from Forrester suggests that marketing in virtual worlds is still too complex for broad adoption as a business strategy, but that this is likely to change in the next five years. Complexity is an issue, not only from the marketer's perspective, but also from the consumer perspective. It is one of the primary characteristics that can slow the rate of adoption for innovators. Some virtual worlds are easier to learn than others; Second Life is likely the most difficult to learn. Software Requirements Second Life, and some other virtual worlds, requires users to install its software. Software installation could be a deterrent to growth beyond the innovators and early adopters already a part of the virtual world phenomenon. Number of Active Members Second Life, for example, does not have the reach that other online advertising venues garner. Despite the claim of millions of residents (with continual growth), under a million are active and engaged. Opportunities for Negative Response Residents of Second Life are known to dislike and distrust big brand promotion. "Griefing," vandalizing and harassing in world, is a common problem for brands. Linden Labs takes a hands-off approach to managing griefer attacks, relying instead on resident governance. How bad can griefing be? A helicopter crashed into a Nissan building, starting a fire that left a couple of dead bodies, and American Apparel customers were attacked by members of the Second Life Liberation Army armed with virtual guns. Accuracy of Results Reporting Second Life offers publicity and the value of free media impressions as social and other media cover new developments. However, no distinction is made between positive coverage and negative coverage. When the media attention is negative, such as reporting attacks on customers, the publicity does not build brand equity. User Security Aside from the security from griefers, Second Life has struggled to provide security to the real life people behind the avatars. In 2006, hackers obtained credit card information for some residents. User Capacity Second Life's infrastructure limits the capacity at some events. Your brand might do a phenomenal job of planning and executing a relevant brand experience with an outpouring of enthusiasm, only to find the system crashes when more than 70 avatars are present at a time. Number of User Interactions Of course, capacity concerns are only an issue if things go well. Spend some time walking or flying around Second Life. It is filled with exquisitely detailed representations of real and fantasy locations. Yet seeing other avatars is rare unless one is spending time earning free Linden $ (the currency of Second Life) at Money Island. Tie-In to Real World Sales Some brands have sold digital versions of their products. Toyota, Reebok, Adidas, and Dell are all examples. No brand has yet announced success at using the in world branding site as a direct response tool for real world sales. Bob Tedeschi, in his article entitled "Awaiting Real Sales from Virtual Shoppers," explains that brands experience little measurable influence on real world sales that can be tracked to virtual branding efforts. Number of Media Outlets There are still a limited number of Second Life media outlets and advertising opportunities (beyond supporting retail space, experiential facilities, and events). NPR and Reuters are there, along with the AvaStar newspaper, but for brands accustomed to buying ad space in hundreds of television networks, consumer and trade magazines, and national, regional, and local newspapers, this is not a rich media landscape. Ad inventory will develop over time. A "MetaAdverse" network has been established to provide in-world billboard advertising. Scalable Branding Initiatives It is difficult to gain economies of scale in branding initiatives. One cannot lower the average costs of products by making mass amounts of products, and there are no huge media buys to lower the costs of advertising. Design Costs There are expenses to brand building in Second Life. Linden Labs sells land and then requires ongoing maintenance fees. Those are minimal compared to the design expenses brands encounter. Alex Veiga points out that brand building requires artists, designers, writers, and marketers to develop all aspects of the brand's identity in Second Life. Scion City, a Toyota initiative, took about 10 weeks and probably cost in the range of $100,000. Importantly, brands that enter Second Life must be committed to operating there. It does no good (and in fact could harm a brand) to have a presence there that is not manned, managed, and leveraged towards accomplishing the brand's objectives. In open worlds, economies are free markets. Brands are welcome to compete and the spoils go to the brands with the best strategy, the best targeting and the best engagement propositions for their target audiences (mindful, of course, to ensure the strategy is suitable for the virtual culture in question). The brands with the wherewithal to strategically plan a social media marketing campaign will also know to commit to the campaign and to provide ample time for the strategy to work prior to making judgments of success or failure and redirecting resources to other marketing executions. In other words, they'll understand and capitalize on why . . . or why not. (c)2008 Dr. Tracy L. Tuten