AVATAR-BASED MARKETING: THE AVATAR-BASED PANEL (PART ONE OF FIVE)

"The important thing about avatar-based communication is being able to jump on tables or other wacky stuff not possible in real life but illustrative of genuine emotions."

A virtual island owned by Harvard, five panelists from California, the East Coast, Toronto, and London, an audience of advertisers, academics, and developers from points unknown, all gathered together in avatar form to discuss the possibilities of avatar-based marketing, spurred on by the recent "Avatar-Based Marketing" article from Harvard Business Review, with the author himself also in attendance. The panel occured last week on Berkman Island, and throughout this week, I'll be running a lightly-edited transcript. (MIT graduate student Ariel Spoonhammer has a nicely condensed version of the event here.)

Today: introductions to the panelists, and opening words from each.  While we waited for the panel to begin, I idly launched a "dancing on the table" animation, which inadvertantly became a reference point for the discussion.

Panel host Rodica Buzescu aka Ansible Berkman is a recent graduate of Harvard College and manager of Berkman Center's presence in Second Life.  This fall, she will be assisting Professor Charles Nesson at the Harvard Law School in developing an open cyberlaw course, a collaboration between Harvard Law School, Harvard Extension School, Cambridge Community Television and Second Life, all centered around creating a class wikipedia page.

Ansible Berkman:  No jumping on tables, Mr. Au.  [To the audience] This panel has the incredible task of answering a very basic and yet large question: do virtual worlds present a significant marketing potential for real-life companies?  We shall leave the moral debate on this topic for another discussion.  For now, I would like invite you to frame your answer to this important question from a marketing/logistical and even technical standpoint. Let's start with Paul Hemp/Hempman Richard, the author of the Harvard Business Review article. He'll give us a short overview of what he has written and why he wanted to bring together such various minds to chime in on this issue. Paul?

Paul Hemp aka Hempman Richard is a senior editor at Harvard Business Review, and has appeared as a commentator on CNN and CNBC. Previously, Mr. Hemp was the director of publications at Mercer Management Consulting, a reporter and editor at The Boston Globe, and a reporter at The Wall Street Journal.

Hempman Richard: OK, well, I'm most interested in hearing what others on the panel and those in the audiences have to say about my argument.  That is, that virtual worlds and games represent an unexplored opportunity for marketers of real life companies, and two, that avatars are in some way distinct consumers from their creatrors. That is, that we're not just talking about the "where" of a new marketing frontier, but the "who". 

One more thing.  Actually two more. [laughs] Actually, three more.  First, thanks to the Berkman Center for hosting the event, and particularly to Ansible for all of her work in helping to set it up. Two, if you haven't seen the Harvard Business Review article, it's free online only 'til June 27, so get a copy here from the board Ansible has made.  And three, anyone have a tweed jacket i can borrow?

AB: Paul, you need to get your fashion tips outside of this meeting.  Let's go over to Zero Grace, aka Tony Walsh.  Hello there.

Tony Walsh aka Zero Grace comments on games, culture and technology issues at his Clickable Culture and industry blog Game Set Watch , and is a designer and consultant in Toronto's interactive entertainment industry, and this year will teach a post-grad course on Game Culture and Design at Toronto's George Brown College.

Zero Grace: Howdy! Sure, I think it's worth exploring not only this virtual world of Second Life, but also other virtual worlds as well...

HR: Be careful, Zero! 

Suddenly, Zero's avatar is caught in a wave of lag that suspends him in mid-air.

ZG: Crashed.

AB: Hmmm, Zero is swimming in midair. [laughs] All part of the virtual experience, I suppose.

HR: Good stroke!

Hamlet Au: And here we have a demonstration of both the potential and perils of the avatar experience.

ZG [still swimming]: Uh, anyway, I guess I was going to say that it's valuable to compare and contrast the varying landscapes in order to determine viability, etc.  Also I'm wondering where the typist ends and where the avatar begins, in terms of being a consumer that can be targeted. Also, I'm falling, and I can't get up. That is all.

AB: I'm intentionally skipping Hamlet a bit and moving on to Cristiano.  We'll see if he chooses to bring up the Snapzilla issue. Cris?

Cristiano Diaz aka Cristiano Midnight has been a member of Second Life since December of 2002, and created one of SL's first and longest running third-party sites, SLuniverse.com, in 2003, and is the owner of the in-world custom animation business ANOmations.  In early 2005, he developed the Snapzilla web site, with nearly 80,000 member snapshots that have been viewed close to 5.5 million times.  In conjunction with Hiro Pendragon, he recently launched SLDevelopers.com, which is a dedicated site for developers working in SL.

Cristiano Midnight: Well, to expand on what Tony said, I do think that each environment is different and more or less viable for various reasons.  Second Life I think presents the most comprehensive environment to explore this issue in. No other environment I can think of offers the depth of content creation that SL does.  That said, I think any company that comes along and does not understand the environment and just treats it as another marketing venue is doomed to fail.

I think, for example, the way that American Apparel has entered SL has been a very interesting and effective thing-- I knew nothing of their company beforehand, and the clothes are actual clothes I would wear on my avatar.  So at least marketing to me, they were quite effective-- I would be more inclined to explore their real world offerings as well

Finally, I just again want to register my vocal protest to Linden Lab's registration changes, which I think in the context of this discussion threatens the viability of SL as a platform for trusted commerce and business.  That is all.  [grins] Snapzilla issue mentioned.

AB: Thanks Cris, very good intro to your perspective on this.  Hamlet?

HR: Stay off the table please.

After leaving his three year stint as Linden Lab's "embedded journalist" last February, Wagner James Au aka Hamlet Au continues to cover Second Life society journalistically at the new New World Notes, a blog that's now funded by ad revenue, including ads from SL residents, since his blog network, Federated Media, now accepts Linden Dollars.  (In tribute to FM founder John Battelle's dot com days, he hosted a rooftop launch party for Federated Media's virtual office.)  He also works as an SL consultant for both for-profit and non-profit companies, including Rivers Run Red and Creative Commons, respectively.

Hamlet Au: The potential for marketing in online worlds is truly staggering, especially when you take the definition beyond straight up MMOs like World of Warcraft or user-created worlds like Second Life. For example, there's Habbo Hotel in Europe and Cyworlds in South Korea, both much more limited avatar-driven experiences, but online worlds all the same. For that matter, even MySpace and other Web-driven interfaces have MMO aspects as well. But today we're also seeing some clear examples of issues we need to consider.

Online worlds very much involve social contracts in the sense meant by Nozick and Rawls, to cite two great Harvard alums. And creating a world that's ideal for marketers and its subscribers is a matter of finding a balance between Nozick's libertarian society and Rawls' free society with government assistance (i.e., the company in this case.)  So when the social contract fails or becomes too restrictive, the dangers emerge.  As we see in Cristiano's decision to close down his Snapzilla today, very much the Flickr of Second Life, in protest of Linden Lab's recent changes to the billing policy. This is actually a good thing for the vibrancy of the world, just like the tax revolt of three years ago was.  Hopefully Linden Lab and the Residents will strike a compromise between their interests. The larger moral for marketers is to understand in online worlds, especially user-created worlds like this one, the consumer is also the creator, and you have to work with them together on creating a worthwhile experience.

Jeff Paffendorf aka SNOOPYbrown Zamboni is Electric Sheep's Futurist In Residence. Jerry's involvement in Second Life includes hosting the monthly Second Life Future Salon, assisting a New York Law School e-Democracy class with management of their Democracy Island project, and helping plan the Second Life Relay For Life sponsored by the American Cancer Society. He is currently leading Electric Sheep's founding involvement in ASF's Metaverse Roadmap Project and helps curate the Second Life Community Convention, State of Play, and Accelerating Change conferences.

SNOOPYbrown Zamboni:  Good to see everyone.  Frst thoughts: Virtual worlds face what i call "the gravity of reality" (truly a force) on a number of fronts. A couple of big ones: As people spend more time using virtual worlds that are Web-connected, they'll want to sew them into the rest of their lives-- identity, friendship, and work-wise. So it makes sense for outside offerings to come in and mingle with the homegrown fruit. It's natural. Over time that distinction will blur.

AB:  Interesting prediction, Snoopy.

SZ: Also the massively multi-player virtual world industry itself is changing. We're moving from Blizzard's throwing $100 million top-down at fantasy games like World of Warcraft to much smaller amounts of money going into smaller, flexible, networked virtual environments like we see with Second Life and soon Multiverse and others. Environments where anything can be built, not just dragons, and real life money is encouraged to come on in. Real life companies will contribute to that development, creating their own "3d websites", coupling virtual and real versions of their products, testing out designs, styles, and campaigns in virtual worlds, and ultimately taking products from the virtual world and making them real. And now i'll pass the mic.

Justin Bovington aka Fizik Baskerville Justin has been instrumental in developing some of the world's major virtual brand launches over the past three years.  His company, Rivers Run Red, is one of the most sought-after creative marketing agencies in Europe, with clients including Adidas, Disney, vodafone, EMI, BBC and Carat.  The virtual development division of Rivers Run Red was the first agency to create an in-world presence within the virtual world platform Second Life.

Fizik Baskerville:  Good evening, from a SUNNY LONDON. I think we should step back a bit, ask why suddenly the interest. The larger media companies have been searching for an alternative to the "interruption model" or the classic 30/90 second TV commercial. They've been talking and needing a place for a "real" brand immersion experience. Platforms like SL are the perfect place. The issue is, making sure that the brand immersion experience is built and created from the communities'
wants and needs.  Also, whenever something takes "time", in this case the time absorption taken into virtual worlds. Companies will know that the time spent is valuable and a commodity of trade. In short, the virtual world experience is the brand immersion experience; that’s an exciting new era for most of the media companies and brands.

Raz Schionning aka Razor Rinkitink is Director and Web Services Director at American Apparel since 2004.  With a staff of twenty-six designers, developers, content experts, and writers, Raz manages the company's web sites and the online stores.  Prior to joining American Apparel, Raz was Director of Production at Pantheon Software and was Vice President of Production at the global interactive agency AKQA (previously Magnet Interactive).

Razor Rinkitink: American Apparel opened the doors to Lerappa Island and our SL store a week ago, and we're very excited about it. Why did we do it and what do we hope to achieve? On a personal level I see Second Life as a budding example of the evolution of the “Web experience”. The potential is amazing and very compelling. The constant expansion and participation is energizing. Our store in Second Life is an experiment in how we may establish relationships with our customers in this evolving medium. To speak like a marketing person for a moment... I see a strong overlap between SL users and AA consumers. They are sophisticated, educated, have money to spend, and fall into our target age range. So it makes sense to investigate how we can speak to this community... Not unlike the way we approach any potential audience in order to grow our business.

That said, I have few expectations about generating significant revenue right now-- it's not the objective at this point. As with all the marketing we do, we’re being innovative and keeping our ears to the ground; we want to see how people will respond to our presence in SL. That's it. Back to you. 

AB: Thanks Raz, we're all very excited to have you here today. AA made quite a bit of history.

RR: It was an honor.

AB: And now, we already have a few questions lined up... let's see what the audience has to say.

Continued tomorrow...

Comments

[Dolus Naumova]

Pretty cool, Hammy. But I couldn't help but notice that Justin Bovington's bio has a typo in it: It's vodafone, not vodafane. :P

[steve]

file this under cool but unnecessary, a solution in search of a problem. why, for example, would a group opt for avatar-based interface when terrific video-conferencing is available, with all the same tools and bells and whistles -- along with realtime high res video?

worlds, inc., anyone?

[Hamlet Au]

Thanks for the typo catch, Dolus!

[Christophe Hugo a.k.a. CHditCH]

Any quick look at Phenomenology (e.g., Husserl, or better, Heidegger) will make the avatarest reader understand that the notions of "real" and "virtual" do not make sense.
Instead, an avatar is on the continuum of my consciousness; an extension of my self if you wish, just like my hand - or my car.
And so far, nobody has ever tried to market anything directly to my car (or my hand, for the matter).
[Article coming soon on this very same topic - stay tuned - Christophe Hugo.

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