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Bold New Opportunities in Virtual Worlds

Joyce Schwarz
Bold New Opportunities in Virtual Worlds Joyce Schwarz

Now boarding: ad flights to the new, new thing. Interactive leaders like Coke, Motorola, Wells Fargo & Co, Disney, and Hollywood film studios are daring to go where few brands have gone before. These innovators are experimenting with the next dimension of online-- virtual worlds. Their missions vary-- to seek new life for wavering brands, to expand civilizations (audiences) or even make "first contact."

Wikipedia.com defines a virtual world as a "computer-simulated environment intended for its users to inhabit and interact with via avatars." Most of the virtual worlds today allow for multiple users and feature chat, texting and even audio messaging and ecommerce apps, enabling marketers to "sell" virtual or real world objects and apparel.

March 26 to 28, 2006 in Lake Las Vegas, NV
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The greatest opportunity for brand expression may just be in the 'solo-branded' Virtual Worlds like Coke Studios, Wells Fargo's "Stagecoach Island," Disney's Virtual Magic Kingdom and Motorola's Mokiworld. But other options like co-branding or develop promotions or sponsorships within other brands' virtual worlds -- like Wal-Mart did in Coke Studios -- are feasible.

In the past few years, brands have began to tip toe into this world's arena by co-marketing with one or more of a triad of the bigger online virtual worlds like Sulake Corp.'s Habbo Hotel, Linden Labs' Second Life and Makena Technologies' There Inc. Agencies and creatives often turn to this triad of firms or others like Electric Sheep, Active Worlds or Peace City to develop their environs or use their platforms to build the basic structures of branded worlds. Examples include Habbo Hotel's relationship with Disney's Virtual Magic Kingdom and Coke Studio, There Inc.'s contracts with the U.S. Army and Peace City's 3D Plaza for the cult film "What's the Bleep?"

My world's not just a game

Sometimes called "adverworlds" by tech pundits, these worlds seldom use advertising in the traditional sense of pushing banners or commercials at the users. Instead, these self-contained environments often resemble MMORG (massive multiplayer online games), usually featuring custom-tailored experiences to promote the brand's products and services in what the creators hope is a more organic manner. Most worlds welcome player or user involvement in designing their own personalized virtual "rooms," customizing their avatars (digital identities) and even "buying" virtual objects and apparel to upgrade the experiences.

What's the big payoff for the brands? One innovator Erik Hauser, founder of San Francisco-based Swivel Media, provides a powerful answer-- engagement. A proponent of experiential marketing, Hauser's firm contracted with client Wells Fargo & Co. to develop the Stagecoach Island role-playing game. "In today's, hyper cluttered space, marketers are lucky to get a second or minute of a consumer's attention. We were able to 'engage' our audiences for hours not minutes or seconds," says Hauser. Engage is a key word here according to Hauser, because he says it means, "To get and hold somebody's attention." He adds, "We were able to provide a meaningful, entertaining, and brand-relevant experience that keeps our audiences entertained and learning for hours."

The price tag for creating what Hauser calls 'these new mediums' isn't cheap. How big are the brand and agency investments? Swivel Media recommends its clients allocate six to seven figures to create one of these experiences. Beyond an estimated one-half to one million dollars in development costs, expert interactive marketers will advise you to add rollout fees such as viral marketing, email promotions, print and electronic buys and offline tie-ins. The true bottom line investment in virtual branded worlds is tough to gauge. According to the Yankee Group, advertising in games is expected to rise to $800 million in 2009 and about one-third of that revenue will come from what those analysts are saying will be from 'advergaming.' A Yankee Group source defines advergaming as "when advertisers create a game around a product rather than place their brands within a title." None of the reports surveyed online posted specific figures for spending by advertisers or brands in virtual worlds per se.
Why not an island or kingdom?

For the right brand, the cache of owning and operating your own virtual world, island or town may be priceless. Want to give your customers the royal treatment? There's nothing like rolling out the red carpet to your own kingdom.

Beyond engagement, what metrics determine the ROI of these efforts? Certainly monthly user visits can be toted up. Across the web, destinations like Stagecoach Island, Virtual Magic Kingdom, Mokitown, Coke Studios and other branded worlds are attracting millions of visitors. Disney's Virtual Magic Kingdom launched only seven months ago and is already celebrating the one millionth character joining what its press promo calls "a free multiplayer gaming community" inspired by its theme parks. Other measurement systems are evolving just as they did in the real world event-sponsorship arena. At this point, whether the world is effective or faulty in enhancing the brand is in the eyes of the beholder.

What's the appeal for the user? Minutes after registration, you can shed, or if you wish, simulate your real life (RL) identity by personalizing an avatar (digital image you create to represent yourself), custom-design your own hang-out, haven or "crib," import your buddy list and IM new pals. For many visitors, the worlds fulfill the yearning for a much-needed outlet beyond home, work and school-- not unlike what Starbuck's founder Howard Schultz touts as the coveted third space in RL. Because of the brand's underwriting, the price is right with entry free in most cases courtesy of the advertiser.

Advertising as content

In a quest to leapfrog beyond 20th Century interruptive ad models, agencies, creative firms and developers are transcending what many media leaders and even audiences thought was an impenetrable final frontier where advertising is perceived as content. Tips to accomplish this amazing feat include: hiring the right developers to create your world, making sure your game creators are savvy with what's trendy and scaleable, and encouraging user involvement and input. Some branded virtual world creators swear that you can even entice the commercial weary TiVo adopter with the right creative online. You'll want to learn from your beta users and continue to upgrade and refresh content along the way. Blogger Ilyan Vedrashko says he "Thinks it would be smart of a company to provide tools and incentives to have the brands incorporated by the players directly."

Next: examples of virtual worlds, and what's next

Every media vehicle's effectiveness can be measured against real goals

"I couldn't measure my display down to the sale in the store, so I cancelled it and put the money back in TV." Palm to forehead. While very little media is accurately measurable down to the sale, there are leading indicators for nearly every brand and product that can be monitored to determine how effective each media channel is at driving consumers through the purchase funnel/process toward a sale. Whether it's online surveys, man-on-the-street surveys, or tracking meaningful website activities other than a sale, there are some metrics you can use other than "sales or nothing." Again, this is hard stuff. It takes planning, controls, strategy, and effort. If it was easy, your competitors would already be doing it.

Different channels have different standards?

Just today I had a CEO tell me the company has been frustrated by its inability to attribute sales (many of which are offline) to various digital media. I said, "Digital is measurable, not magical." Being measurable isn't black or white, but that's what so many CEOs think. If it's not measurable, it must be good for branding. If it is measurable, it must drive a sale. Unfortunately, and again, it's not easy thinking in shades of gray, but that's what great marketers do. They understand the degree to which a channel is measurable and make the most of it.

The medium, the message, and...the data?

Marshall McLuhan said, "The medium is the message." Whereas there used to be two considerations when planning advertising, there are now three. Choosing the right media channel and doing great creative now only gets a marketer a "C." Knowing how to harness your own data, upload it, download it, statistically analyze it, and apply it to your campaigns gets you an "A."


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