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Fallon strategic planners Aki Spicer (Aki Octagon) and Avin Narasimhan (Desi Stoneage) have come back from the future to offer their POV about Virtuality and it’s implications for brands. One of the hottest debates in marketing circles today is the viability of virtual worlds like Second Life. What are they? What do people do there Why? What’s in it for me—if anything? We’ve seen companies flooding these worlds, and some are finding it difficult to translate their virtual world presence into real world gains. The truth is, we traverse virtual dimensions every day without even thinking about it. From financial transactions, to games, to our daily Facebook interactions with friends, Virtuality is a new normal and it impacts many facets of our lives. It is through this lens that we explore what Virtuality means now and in the future, and what our agency needs to know to extract the most from it. *Brainfood is an monthly digest of Fallon Planner’s strategic intelligence and bridges the gap between trends, business issues, and actionable opportunities for the agency and clients.
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::Brainfood::
VirtualityOctober 23, 2007
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Introduction
In today’s session of Brainfood, Fallon strategic plannersAki Spicer and Avin Narasimhan break down the vast andcomplex trends of Virtuality and their implicationsfor brands.
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“80% of active internet userswill have a “second life” in a virtual world
by the end of 2011.
Gartner Symposium/ITExpo 2007
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Welcome to the first session of Brainfood.What can you expect today?
A brief introduction to Virtuality and how we got here.
Virtual Worlds: the most visible form of Virtuality.
Implications and trends in society.
What it could mean for business.
Key takeaways for you and your clients.
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Virtuality: Our lives are increasingly “virtual,”but we often don’t recognize it as such.
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We can trace the roots of our virtual pursuitback to 1955 when Sensorama recreated thefull experience of riding a motorcycle.
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Flash forward to the 80s and 90s: works offiction laid the groundwork for the conceptof today’s visual Web.
MetaverseThe Matrix
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And beyond fiction, the work of French socialtheorist Jean Baudrillard helped to explain thebasis of Virtuality as seen in culture.
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Virtuality reframes our economy, worldview,and culture.
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As early as the first iteration of Windows, webegan a mass adoption of 3-D virtual surrogateson PC desktops.
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We trade millions of dollars everyday based onthe virtual values.
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We express who we are and how we feel throughdigital representations and alter-egos.
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And many of us, particularly young people, areturning to games instead of movies and TV,driving mass awareness and further blurring lines.
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We’re moving away from 2-D MS-DOS style flatapps towards rich 3D environments that bringthe same data to life.
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Digital prototyping enables the real parts to workflawlessly before they’re ever made real.
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Virtuality commands real love and attentions.
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We’ve reached the age where what was oncefantasy and “futuristic” is now increasinglybecoming a way of life.
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“Welcome to the desert of the real.”
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Virtuality is no longer nerdyfantasy. It’s real and it’shappening all around us.
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“ Personally, I feel the vague lineaments ofsomething beyond Web 2.0, and they involve
some fairly radical steps. Imagine a Webwithout browsers. Imagine breaking
completely away from the documentmetaphor, or a true blurring of application
and information. That's what Web 3.0 will be,but I bet we will call it something else.
Stowe BoydSocial Media/Web 2.0 Theorist
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We’ve become beings of a digital worldwherein almost any conceivable life eventcan—and largely does—take place virtually.
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Virtuality is reality, and it’s the next evolutionof our increasingly digital social lives.
Web 2.0 Web 3.0
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Virtuality is changing human behavior.
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“One of the things our grandchildren will findquaintest about us is that we distinguish the
digital from the real, the virtual from the real.In the future, that will become literally
impossible. The distinction betweencyberspace and that which isn't cyberspace is
going to be unimaginable.”
William Gibsonauthor, futurist
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Understanding Virtuality can be a vague andsomewhat abstract concept. Today we’ll look atwhat is the clearest manifestation of Virtuality.
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Digital Life
Virtual worlds have been buzz words in popularmedia as of late, and myriad forms exist.
Kids Play
Pure Gaming/Fantasy
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It’s not happening on the fringes of society, butrather has engaged us globally.
1% of the world’s population registered World of Warcraft residents.
Time spent in Second Life increased six-fold in 2006.
If NeoPets were a country, its population would be the 5th largestin the world.
Club Penguin has 4M+ unique monthly visitors and generates a50% profit margin, projecting $30 million in 2007 profits.
Swivel Data Research August 2007WikipediaSocial Media Club May 2007
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Second Life populations are sky rocketing asthey become more integrated in our daily lives,translating into real world commerce.
Blizzard Entertainment March 2007Blogpulse trend search July 2007
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Yet, Second Life may be experiencingslowing growth.
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It’s important to remember that we’re still in theearly stages, and so far these worlds arereminiscent of our first forays onto the Internet.
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Exploring Virtuality through the lens of worldsthat let users fully define the experiencereveals the most interesting insights.
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People are people…and even in the metaverse,we still behave like people.
Linden Labs 2007 Technographics Survey
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We’re creating living, breathing societies withunique social mores and culture, which embodythe ideals of autonomy and self-efficacy.
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It’s an evolution of the very idea of “face-to-face”interaction and personal connections.
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They provide a new venue for the exchange ofdialogue and even political movements with noconsideration of physical boundaries or barriers.
GLOBAL IBM CONFERENCE
EXPERT PANEL AT CRAYONVILLE
ADVENTUREECOLOGY ACTIVISTS
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More and more we see life imitate art asVirtuality redefines traditional experiences.
James Cameron’s new movie—Avatar.
Draft FCB mockumentary of Second Life.
CSI:NY will take murder mystery intothe virtual world.
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“There's real money to be made in themarketplace. People actually earn part or
all of their real-life income from suchbusinesses as party and wedding
planning, tattooing, auto manufacturing,fashion and jewelry designing, real estate
development, architectural design,bodyguarding, publishing, and private
investigation.”
—Patricia Duebel, PhDThe Journal
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What could it all mean for business…and brands?
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As with most emerging technologies, thepotential for business application is often hardto see at first glance.
HOW MIGHT OUR BRAND FIT IN HERE?
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Kid-centric fantasy may be perhaps the easiestin-roads for brands…
Answers.com via Wikipedia
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…as youth today are rapidly embracing Virtuality.
2007: 24% of U.S. child and teen Internet users visit virtual worlds.
2008: 34%
2011: 53%.
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Even for today’s youth, branded virtual worldsare providing a level of engagement that staticsites can’t compete with.
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Companies eager to jump on the virtualbandwagon have learned cost of entry ismore than just “showing up.”
Wells Fargo—Departed. American Apparel—Barren
Business Week Online May 2007
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The right to participate needs to be earned.
The NBA understood this imperative and truly offers a uniqueexperience and commitment to residents.
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With or without brands, resident entrepreneursare reaping lucrative rewards through their owncreations.
BW Online April 2007
Alan GraiefLand Baron
+$1M revenue
Anshe ChungLand Baron
+$1M revenue
Philip RosedaleCreator: SL$19M in VC
Reuben SteigerConsultant
+$6M in fees
Sibley VerbeckConsultant
$15K per project
Kevin AldermanAdult Entertainment
$50K and up
Alyssa LaRocheClothier
$30-$100K fees
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Many of these content creators are extremelyprotective and skeptical of those who wouldintrude without respect.
The influx of real world brands is sometimes met with discontentand other times overt hostility.
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Brands that add the most value to the userexperience are the future—not just of virtualworlds, but of the social web and how we liveour lives.
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As an example, the desire for connections andcompanionship in these worlds have spawnednew industries.
In-world engagements like sldogs.com allow us to buy andaccessorize a pup to accompany us in digital life.
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And worlds like Neopets attempt to redefine theidea of pets for the digital space.
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As interest in Virtuality grows, some innovativecompanies are cutting out the middleman andbuilding their own worlds.
JC Penneys (Forterra) Novartis (Prontomedia)
BusinessWeek Online May 2007s
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Virtuality soon demands reappraisal of oursocio-political assumptions.
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Life’s eternal questions still linger…and take oneven greater significance in Virtuality.
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And these questions spark the collective curiosityof burgeoning societies and new communities.
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The complications of digital life has spawnedethical debates of copyright, decency, freedomand access—since the 90s when the Internetwas in its infancy.
…and they continue still, without clear resolve.
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DISPOSABLE FAD?
IMPRACTICAL?
DEHUMANISING?
UNNECESSARY?
A HAVEN FOR PORN?
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As with any emerging tech, there are bumps inthe road—and even predictions of impendingdoom.
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“For virtual worlds and metaverses to achievegreater potential in the marketplace and
grow beyond early adopters, the experiencemust be untethered to meet the needs of the
Anywhere Consumer.”
Yankee GroupAnalysis of Second Life, 2007
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While virtual worlds may not be the finalchapter, Virtuality is the OS of tomorrow.
Boot up.
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We’ve covered a lot today. Some key takeaways…
Virtuality:
Life Remixed: Extension of our real lives.
Worlds Unbound: Expanding global culture.
Spawned Industries: Entirely new economies.
Engage Me: Fueling participation, not just consumption.
Control and Protect: Creative self-expression/control of ideas.
First Life Beta: A new level of try before you buy.
Visual Web: A richer 3D experience.
Half Life: Blurring lines between real and virtual.
…leading us toward a broader ubiquity of Virtuality.
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Continue the conversation on our blog:http://fallontrendpoint.blogspot.com
Life Remixed Virtual Worlds
Virtual Life
Postcards from Second Life
Emoticon
Slurl
Avatar
Instant Message
Worlds Unbound
Spawned Industries
Visual Web
Life Beta
Engage MeControl and Protect
Google EarthWebkinz
User Defined Experience
Fantasy
Self-Efficacy
Autonomy
Digital LifeGaming
3D
Kidz Play
Brand Evangelists
Tech Savvy
Early AdopterMetaverse
Connections
Virtual Culture
Co-Created
Borderless Age
Digital Self
Sacred Creations
Business 3.0
Participate
Humanized
Test Drive
In-World
Residents
Parallel Life
EscapismYouth
World of Warcraft
Entropia
Habbo Hotel
There.com
The Sims
Neopetz
Zwinky Playdo
Playstation Home
Futurist
Customization
Virtuality
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And look out for the invite to next month’sBrainfood session.
Brainfood is an executive digest of Fallon Planner’s strategicintelligence and bridges the gap between trends, business issues,and actionable opportunities for its readers.
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