A zebra and its stripes

Marty the Zebra: "I'm ten years old. My life is half over and I don't even know if I'm black with white stripes or white with black stripes!"

I've followed Clever Zebra with interest since they launched, but after some four months, I believe they have the same problem as Marty. Their value proposition is "SL entry made simple" and they promise to achieve it with a pack of business oriented builds and utilities - from an amphitheater to a slide show presenter. Their offering is RL company friendly - a stated up-front price of $4,950 and $395 per month enables companies simple cost calculation and moves them from perilous and possibly expensive project territory into the safe product zone. They will definitely get some customers and expand their presence. However, after some 6 months, I think they will have to reconsider the nature of their stripes.

Clever Zebra's basic fallacy is in their value proposition. Is the price and complexity of creating a Second Life presence really the major hurdle the real world companies must overcome? I believe not. The major problems are the unwillingness to invest human resources in SL; the complexity and immaturity of Second Life as a business platform; and the biggest one of all, the difficulty of forging lasting and valuable relationships with Second Life community.

How does Clever Zebra help companies overcome these difficulties? Their corporate product page is quite devoid of information; it's hard to discern exactly what services the list price includes. If it's consulting, there can't be much of it - let's say 30 hours at $100. Is 30 hours enough to get company personnel to grasp the UI complexity and get to know Second Life so well that they can begin to use it productively? I sincerely doubt it.

The kind of company that goes for "as low as $$" deals is not the kind of company that is willing to heavily invest resources in getting to know Second Life and extracting value from it (and is also most probably not a company that could use Second Life to "save thousands of dollars on travel"). Only a few real companies are - Cisco Systems, IBM, and Dell, to name a few. All of them understand that they are in virtual worlds for the long haul; there is simply no ROI to be made in short term. Does Clever Zebra tell that to their potential customers? I hope they do.

So what does the future hold for Clever Zebra? They will definitely sell a few packs in the upcoming months. But, to keep customers from leaving Second Life in disgust after 6-12 months, exclaiming "Second Life is totally unsuitable for business", they will have to start accurately representing both the challenges and the maturity of Second Life. They will have to admit that they are not providing a "solution" for real companies wishing to enter Second Life - they are only making the first step of many much simpler.

It's time to decide: black with white stripes or white with black stripes?

Second Life for fun and profit: the cycle of added value

Introduction * a newbie's response * the value of.. well, value * the formula for success * give before you take * a hearty guffaw

Virtual worlds are tricky. That holds true for users and companies alike. The old behavioral patterns no longer apply - there are no quests to embark on, character level is not measured with simple stats, repeatedly hacking at things doesn't guarantee a level-up, and pouring money into shiny builds does not guarantee an increase of sales.

Ah, the simplicity

What is a person or a company confronted with a brave, yet incomprehensible new world, to do? Well, most simply leave. That is evidenced in low user retention rates and the exodus of companies to greener (or so they think) pastures - to other virtual worlds or back to the warm embrace of traditional advertising. Yet, some persevere and a few of them even prosper. What do they know that the rest don't?

"There there, we'll do it much better this time"

It's simple: the prosperous ones understand value.

The key ingredient of a successful and eventually profitable Second Life presence is added value for the Second Life community. Only by adding value can companies build their Second Life community, and only a Second Life community enables the companies to reap added value from Second Life.

The cycle of value

A process for real companies entering Second Life should therefore be something like this:

1. Company starts creating value for Second Life users. That can be practically anything: free content, free music, regular events, education, ..
2. A community forms around this and grows
   
3. After a community has been established, the company can reap the added value benefits - brand promotion, attracting new customers, business partners or employees, sales of virtual and real goods, content creation, market research, experimentation with business models, ..

But why does it work like that? It's nothing but the old "Give before you take" rule applied to business.

Looks familiar..

The "GBYT" rule is one of the cornerstones of human interaction - in a way, our default behavior. Big corporations were only able to circumvent it by hammering advertising messages into us and controlling the supply. In Second Life - and all open virtual worlds - this kind of a heavy-handed approach doesn't work - everybody's free to teleport away and the playing field for content and service providers is extremely level.

I believe the virtual worlds are here to stay. Not necessarily Second Life, to be sure, but there will be virtual worlds and they will shape our life - both personal and professional. Like with the internet, the sooner you "get it", the bettter - and that goes doubly for companies. Which means that in order to prosper in virtual worlds, they will have to learn what it's like to be human again.

Hah!