Second Life: Where Marketing Strategy Goes to Die?
July 26, 2007
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Like a lot of folks, I’ve been intrigued by the marketing possibilities present in Second Life. I’ve been fascinated by all the people making over $5,000 a month in real money (132 at last count) and by the companies holding press conferences within it. Like 4,000,000 other people, I downloaded the software, created my avatar and spent hours figuring out how to walk around, talk to others, teleport, etc. And it is kinda, sorta fun.
On the flip side, there was the time I went to a heavily advertised in-world club. And danced. Alone. It was creepy, bizarre and virtually lonely.
That hasn’t stopped Coke, the NBA, Wired, CNET, Adidas, Coldwell Banker, Sears and others to open up shop, often investing as much as $500,000 per year to do so. Wired now has an excellent article outlining how much of that money may be wasted.
Some amazing facts from that article that explain why I was so lonely in that dance club:
- While SecondLife talks about 8 million users, the actual number of Americans actually using the site on a given week is only about 100,000.
- 85 percent of the avatars created have been abandoned.
- On a random day in June, “Sexy Beach” had 133,000 visitors. IBM’s huge innovation island, on the other hand, got 281 visitors. Coke’s highly praised Thirst Pavilion got 27 visitors.
It turns out that Linden Labs servers can only handle about 70 visitors to a given place at a time. 70. Which explains why the don’t do some obvious things they could otherwise do to encourage density.
Don’t get me wrong, I’m not against experimenting in social media. It’s what this company is all about, and too few companies are doing that right now, not too many. And $500,000 out of Coke’s ad budget isn’t going to cripple anyone.
But other social media advocates, including Joseph Jaffe (who I don’t know but who I respect), are pushing Second Life in the article with quotes like, “So when people ask, ‘Why Second Life?’ I ask, ‘Why not?’”
Why not? Because social media for business and brand building is not about setting up shop on some poorly traveled virtual world with a ridiculously high CPM. It’s about conversations. It’s about having conversations with your target audience. It’s about participating in your target’s conversations. It’s about listening in a way that helps you understand your audiences better.
The big ad agencies still don’t get it. Banner ads on Facebook are still just banner ads. They’re not social media, any more than a 30-second spot during a break on Survivor is reality TV.
Why not spend $500,000 on a Second Life presence, to answer Jaffe’s question? Because no company can do it all, and for most companies, 1/10th of that investment in a sound social media marketing plan, followed with the development of a sound multi-pronged social media strategy will pay far bigger dividends and have far better ROI. That planning may lead you to a Second Life experiment, but it may also lead you to some more interesting, more productive places.
Because when we get too excited about technology and start investing millions without considering the return, well, it makes me think of 2001. I’m sure smart people work on all of those brands I mentioned, just like smart people invested millions in the dot com bubble.
Smart marketers experiment, sure. But smart marketers set a strategy first, and put their toes in the water (or dive in) in ways most likely to generate returns. They also analyze returns. Reading those SecondLife stats this month makes me wonder, “Has Second Life Peaked?” Cost per acre is down from the prior month. The number of people making over $5,000 a month is down for the last two months… Smart marketers are watching those numbers, too.
When we saw how most ad agencies, PR firms and SEO firms were thinking about and reacting to social media… Well, that led us to form Ignite in the first place. Social media, new media, virtual worlds. If you’re in the marketing business, it’s still about business–at least, it is in this life…
~Jim Tobin
Ignite Social Media
(Notice how there are fewer than 70 people listening to this artist play live? How much did Coke pay to reach those people? Too much, I’m sure, even if you count the 1,200 others who have watched this video…)
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3 Responses to “Second Life: Where Marketing Strategy Goes to Die?”
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Those statistics are surprising.
Something that social networks need to consider is how to build brand loyalty among their own social media consumers. Facebook has adopted this - SecondLife seems to need more of this. For a site to successful to marketers, the site itself needs to be able to attract AND retain its users.
You just hit the nail on the head: SL needs to be part of a “multi-pronged” approach. A press launch and a big empty sim won’t cut it…)
[…] you may want to subscribe to my RSS feed. Thanks for visiting!In a post in July, I talked about how Second Life marketing and strategic marketing were not yet aligning. I originally thought that the early adopters hadn’t gotten it right […]