Sale of virtual goods continues to increase, despite recession
My avatar when I first joined Second Life
I just read a very interesting article on e-marketer’s blog about the sale of virtual goods in Second Life. It’s been some time since I was a Second Life user, I got into it back in 2006 after I was asked to research it for work. I actually ended up getting pretty into it and so it’s interesting for me to see the sales and engagement figures from e-consultancy,
“Users of virtual world Second Life spent $567 million on user-to-user transactions in 2009. That represents a 65% year-over-year increase in spending on user-generated virtual items for avatars. In addition, the service’s Web marketplace saw virtual goods sales of $6.1 million”
“Second Life’s worldwide user base increased by 15% to 769,000, while the amount of time spent in the virtual world climbed even faster, by more than 21%, indicating increased engagement.”
When I was playing the game I spent a fortune customising my avatar, but I was really embarrassed to tell anyone about it. People would look at sales figures for virtual goods and scoff, saying, “But WHY would people spend real money on something that doesn’t exist?!”
I think it’s something you have to experience to fully understand. For example, a friend of mine started playing Pet Society on Facebook and it was only then that she understood how I could justify spending real money on pixel objects. E-marketer have a quote from Cary Rosenzweig, CEO of IMVU that about sums it up,
“Virtual goods have value to people. People buy virtual goods usually for one of three reasons: to express themselves — so they’re buying virtual goods to make their avatar look terrific — or to build relationships with other people in the form of gifts. And [the] third reason, especially in gaming environments, is that virtual goods enhance your power to effect change, to win, to do what you would like to do in that area.”
The research cited by e-marketer also predicts that virtual worlds such as Second Life will fall behind in the virtual-goods economy while social network players like Facebook become more involved in the space. This sounds about right to me, with the popularity of games such as Farmville and the growing ease of making and accepting micro payments. While Second Life is quite complicated to use and has a high rate of abandonment, it still made $573.1 million in 2009. Just imagine what 350 million active Facebook users could spend.
What do you think? Would you spend real life money on virtual goods?
