For Sale - Second Life

In many of our recent articles, we have reported on one business after another shifting resources toward the Internet. Obviously the web is a market for the business minded, but the methods these new businesses are using are not the same as those aimed at the web 1.0 counterpart. The previous rendition could be described as "going fishing", as companies proliferated the web with banner ads, spam, pop up and banner advertisements, and hosts of "traditional" sales tactics. Given the number of people inhabiting the virtual space in the early years, these techniques were expected.

In the 90's the web just represented another place to find people. To business concerns, a group of people has always been a place to reach numbers with products, and business is always about making money. As the web is quickly overtaking print and other media advertising revenues, or making inroads into them, we should pause to think about what is happening.

One indicator of business intent is to examine where their effort (money) is going. Since 2001 Internet advertising revenues have more than doubled, as indicated by The Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC).

Advertising revenues indicate the need for companies to address people on the web, but are there other indicators that might provide information to qualify web 2.0's status? According to the Annenberg Digital Future Project being conducted at USC, the number of people who make purchases on-line has more than tripled since 2001. The same source indicates that of those people that buy on-line, 3/4 admit that their purchases have negatively affected their buying in local stores. So, obviously business in other sectors is feeling the web.

The project also indicates that one in every two Internet users actually make purchases on-line now. In 2001-2003 Internet users had major concerns with giving out credit card information over the web, but the latest numbers indicate that this number is only about 4 percent today. A recent article in eMarketer predicted that total US B2C E-Commerce sales will exceed $200 billion dollars this year! Social networks alone could account for $1 Billion, and the article projects 2008 ad spending to leap past $23 billion dollars in the US alone!

Astonishing! Figuring out where all this effort and money is going and leading to is almost as daunting as the web itself. The most concise prediction of where things "seem" to be headed lies in the simplicity of symbolism. Take for example the simple fact that on-line sales will exceed catalogue sales this year. The catalogue is a symbol of the desire and willingness of people to buy products remotely. It is also a symbol "historically" of the Sears and Roebuck Co. All Americans older than 20 are familiar with the giant catalogues their parents used as doorstops. Sears started this business over a century ago, and quickly became the premier mail order company in the world.

What has that got to do with the Internet? In a press release from Reuters, Sears and IBM will unveil the "Sears Virtual Home" in a showroom at Second Life! No big deal right? Well Second Life is not just any old web site, but rather a 3D virtual world where 300,000 regular users create characters and interact in virtual reality. It is not exactly the Matrix, but it is beyond any place we would have thought we would see Sears and Circuit City!

There is no way for me to explain this virtual playground adequately here. I can only say that it took me 20 minutes to cloth my unique character, and another 20 to get over how many people were running around. I expect I will have to visit the Sears showroom later this month, and maybe buy something with the site's own currency. That's right, they have their own money!

If you have been reading the news for the past few months, I cannot see how your head is not spinning. Products, companies, web sites, investments, mergers, gadgets, and on and on it goes. Mind boggling for a city boy from South Carolina, simply mind bending stuff. The biggest question I have about all this is, "Who is leading whom, where?" I will attempt to explore that question at length in another post, but for now let's think on web 2.0 and if we are there or nearer 2.5.

Or, you can create a guy avatar.

Screen courtesy: Second Life archive

Table acknowledgement: IAB Web-site