Study Suggests Real Life Luxury Item Sales *Improved* By Knockoffs & Noobs -- Also True With Second Life Content?
It's one of Second Life's greatest mysteries: though the sale of virtual items that are cheap knock offs of popular (and more expensive) Second Life brands remains a persistent and painful social problem, the total amount of Linden Dollars spent between users continues increasing. This led me to suspect SL content theft is actually a marginal part of the overall SL economy. However, I may be wrong, because the recent findings of an MIT professor suggest another, and I think better explanation. Put simply:
Maybe Second Life knockoffs actually increase the sales of the original brand.
This at least seems to be the case with real world luxury items, business professor Renee Richardson Gosline learned. After interviewing hundreds of consumers who knowingly bought knockoff luxury goods (fake Guccis, etc.) Professor Gosline found that 46 percent of them ultimately bought the legitimate version within two years. In other words, the act of buying knockoffs doesn't diminish a desire for the real thing, and may even increase it.
Another Gosline study will be instantly recognizable by Second Life's many fashionistas: she discovered that when consumers judge if a luxury product is a knockoff, they generally don't scrutinize the product's quality. No, they do something else:
To identify knockoffs, consumers scrutinize the overall quality of the person using the product!
When looking at real and knockoff luxury bags displayed on store shelves, Gosline found, consumers were not confident they could to discern the legit model, and were less likely to pay more for the product.
But when Gosline showed the same consumers pictures of the bags in use, their confidence level [jumped], and they were willing to pay an average of $783 for the bags. Why? Based on their comments, the people in the survey group were deciding if the person in the photo matched their preconceived notion of who is likely to own such products... In a sense, consumers are not so much rendering a verdict on the bags as deciding if the people measure up.
Whole Second Life blogs, of course, are devoted to savaging poor Second Life fashion choices. And taking these two Gosline conclusions together, I think we have a very plausible explanation for why in-world spending keeps increasing: it's growing not in spite of content theft, but because of it. New users tend to buy cheap, knockoff SL products, but if they remain in-world long enough, they eventually find and purchase the real brand. And this process is greatly helped by the social ridicule around cheap and shoddy knockoff products that noobs generally wear. In both cases, it seems the very existence of knockoffs increases the market for originals.
Assuming of course, this real world economic phenomena applies to Second Life. My strong sense is it does, and Professor Gosline gives us a strong insight in how the virtual economy works too. But I put the question to SL content creators: do you think her findings are applicable to your own consumers? How many former owners of knockoffs came to you looking to purchase the legit version?
Pictured: Facebook page cited by Prof. Gosline as an example of phenomenon she studied. Hat tip: Cory Doctorow at BoingBoing.