Virtual goods offerings continue to garner more momentum in the marketplace. Why do consumers want to spend their money on items that only exist in a virtual context? Is it even appropriate to make a distinction between what motivates people to invest in virtual goods as opposed to real-world goods? Join us for a conversation about what motivates people to invest their own time and money in digital goods and why virtual goods matter.
Kim: In gaming worlds, functional goods have more power. In a gaming environment, power-up and others that make sense for gaming have more value. In social networks, it's about social meaning that are attached to purely decorative items. Even though there is no "power" with those goods, there is a value of those goods within the social networks themselves. It's not coincidence that we are seeing virtual worlds grab hold of teenage users. It's a time of life issue, where teens are trying to identify themselves. These goods can be viewed as part of that social network and growing up, part of the identification.Sherman: We have had rare goods be sold on eBay - we had a rare halo sell on eBay for $6000, which can be used on Gaia Online. We do create products and goods that are for a limited time only - available for one month only - and smart users learn to invest in those goods and flip for more gold. It's not an obvious or easy way to do it, but we do have that form of economy. The decorative items are very powerful in the virtual world.
James: We do both fucntional and decorative goods - the functional revenue comes from badges, which give you priviledges. The social puzzle does come into the functional goods - you have to have other sailors, even if you have the biggest boat that you bought. You can buy that boat, but you have to have others work with you. There is that balance of finding the right price. Companies in Korea have found that secret to tweaking prices for the right amount to get the best sales.
Kim: Some groups have it where the content is created by staff, while other worlds have content created by its users. We have seen some places where the audience cared more about the goods created by other users, and ignored the "brand" virtual goods. But, there were also community members that wanted the brand name goods (that were never released in the real world).Sherman: There are quality goods versus regular user created content. It's about high-quality, and while there is the long tail, it is about quality.
(I had to leave for a phone call, so I apologize for missing the last 20 minutes.)
Tags: public relations, PR, marketing, advertising, marcom, marketing communications, communications, virtual goods, virtual goods summit, vgsummit2007, Craig Sherman, Gaia Online, Daniel James, 3 Rings, Amy Jo Kim, Shufflebrain, Byron Reeves, Stanford University, Nabeel Hyatt, Conduit Labs