The market for virtual goods is exploding as teens continue to shape a new marketplace that delivers both real- and virtual-world experiences. Charles River Ventures recently estimated that consumers are spending more than $1.5 billion a year on virtual goods worldwide. Pair that with powerful teen spending demographics -- eMarketer estimates teen spending will reach $208.7 billion in 2011, up from $189.7 billion in 2006, for instance -- and you've got a trend marketers can't ignore.
The economy may be struggling, but teens don't seem to be feeling the pinch. A recent survey of more than 4,000 teenage users of the WeeWorld social network found that despite the declining economic forecasts, more than half of teens claim to have the same or higher allowance than before, while only 11 percent noted that they are getting less allowance now than in the past. There is no better time to be a teen marketer.
Traditionally teens -- and all of their spending power -- have been tough to reach. Today they are flocking to virtual worlds and social networks to do what teens do best: evolve their identities, socialize, and express themselves creatively. The visual nature of virtual worlds allows for a type of expression never before possible.
When our survey asked the reason teens have an avatar and why they would pay for a virtual item, the No. 1 reason was "fun." To be more specific, more than 75 percent like having an avatar simply "because it is fun." Overall, teens gravitated toward "anything fun" as the things worth their money online, but girls are also much more interested in spending money online to express themselves and their passions (24 percent) than boys (17 percent).
So do marketers fit into these booming virtual economies where the focus is totally on fun? Yes, in fact they fit extremely well for two key reasons. First, brands are key components of the way teens develop identities, express themselves, and collect visual equity they can leverage. Teens are naturally inquisitive, and creative and branded goods are just more raw material for that creativity. In fact, brands are so important to teens that they ask virtual goods providers for them every day. Teens love to choose brands they identify with, and they proudly display them on their avatars, showing them off to their friends, expressing their preferences, and showcasing their style all at once.
Second, teens love virtual goods from marketers because they are free. Keep in mind that teens have to either earn or purchase virtual currencies to buy the virtual goods they desire. Everyone -- even those with big virtual bank accounts -- hungers for free items.
So when a marketer offers a compelling set of free and fun items as part of an advertising campaign, not only do teens respond positively, but studies have shown significant increases in aided and unaided brand recall, brand favorability, and purchase intent. The items are seen as virtual gifts directly from the brands, and the brands benefit from the added mindshare and positive sentiment.
So what are some examples of brands providing fun for teens in virtual worlds? Well, that changes all the time. Today, it might be a branded animated skateboard and the coolest mobile phone, tomorrow it's a coveted gift or a shampoo offering special hairstyles, and maybe the next day it's a TV for a virtual room that runs a movie trailer. Teens are constantly seeking novel ways to entertain themselves.
The good news is that while the definition of fun may change every day, the rules of an effective virtual world marketing campaign do not. Based on continuous daily feedback from WeeWorld users, our recent survey, and experience helping brands get it right, there is a core set of rules to keep in mind when harnessing the power of teen virtual environments for your marketing initiatives:
- Give them things they want in the context of your brand. Don't just slap a logo on something -- remember that for every branded item they adopt, they become a viral brand ambassador. The items they want include things to wear, decorations for their rooms, gifts for their friends, elements of events or games, and limited edition items.
- Bring the fun. Work in partnership with the virtual world to inject playfulness and self-expression into the mix. It's not as hard as it sounds.
- Integrate it into community behavior/activity, like prom season, end-of-school or beach parties, political debates, environmental issues, etc. Leverage interactive elements such as scavenger hunts, quests, and virtual events to increase the engagement with your brand.
The users themselves are in control in new media environments like virtual worlds. That changes the game when it comes to advertising and marketing, but it doesn't mean the job of reaching them is harder. It's actually far easier than you may think if you work with the virtual world to figure out what works best with its audience.
Young teens like those on WeeWorld are in the midst of defining themselves. If brands and marketers do it right, they reap the benefit of having their brand become part of an important formative experience as teens develop their core identity -- and have fun doing so.
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