3DBusiness modelsSecond LifeVirtual Worlds

Musings on the future for virtual worlds

By October 25, 2007 5 Comments

There are two big takeaways for me from the Virtual Worlds Forum conference I have been attending for the last couple of days.

The first is a firming up of a conclusion that I have been coming too for a while – there is huge opportunity at the nexus of virtual worlds, games (probably casual) and social networks.

Habbo Hotel is a good example of this, as are new companies that are here at the conference MoshiMonsters from Mind Candy and Moipal.

Games, social nets and virtual worlds are coming together and that is creating opportunities for new companies that are radically different from their forbears that have focused in one of the three areas. I think the best will be easy to learn, work well with short session times be social, and have an interesting and continually developing content story. The revenue model will be about subscriptions and/or virtual goods and/or advertising.

Which brings me to my second point – there is already huge opportunity (by which I mean dollar opportunity) for brand advertising in virtual worlds.
Until now I had seen the empty brand sponsored spaces in Second Life and the comparatively small numbers of active users and concluded that the brand budgets coming into the world are experimental, and were not at the point where they would really start to scale.

Not so.

The combination of deep engagement and response rates as high as 30% are getting brands to the point where they are parting with budgets they would normally reserve for campaigns with high headline impressions numbers. The key to this is the quality of the campaigns which contribute significant new content to the worlds. Habbo Hotel in particular is blazing a trail here.