Does Second Life Mark the Beginning of a New Era of Online Shopping?: Exploring the Avatar-Based Shopping Experience in Virtual Worlds

Does Second Life Mark the Beginning of a New Era of Online Shopping?: Exploring the Avatar-Based Shopping Experience in Virtual Worlds

Jang Ho Moon (University of Texas at Austin, USA), Yongjun Sung (University of Texas at Austin, USA) and S. Marina Choi (University of Texas at Austin, USA)
DOI: 10.4018/978-1-60566-792-8.ch012

Abstract

In this chapter, the authors explore the unique social dimension of shopping in virtual worlds, namely Second Life, by examining the role of avatar-based interactions in determining consumer shopping experience. To this end, an overview of Second Life, and other similar virtual worlds, is provided. This chapter then introduces the concept of social presence and offers a conceptual discussion of how avatar-based shopping in virtual environments is distinctive from shopping in other Web environments. Next, the authors present the preliminary findings of the ongoing research study investigating how consumers’ interactions with salespersons and peer consumers via avatars influence their shopping experience in Second Life. This chapter concludes with a future prospect of virtual worlds and directions for future research.
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Introduction

One of the most recent internet trends are virtual worlds. Just like the hugely successful web-based social networking sites, such as MySpace and Facebook, virtual worlds have emerged as “the next big thing” (Olga, 2007). Following the vast popularity of Second Life, a number of other virtual worlds have been created, and currently attract a wide range of people from around the world. According to a market research study by Kzero (2008), over 70 virtual worlds, including beta-test versions, are currently accessible. Many multinational corporations including Google, IBM, McDonalds, and Disney have leaped on the virtual world bandwagon and created virtual worlds of their own. Gartner, a technology analytical firm, predicts that 80 percent of the active internet users and Fortune 500 companies will participate in some type of virtual world by the end of 2011 (Gartner, 2007).

The mounting popularity of virtual worlds opens up new doors for marketers, and numerous real life companies, such as Coca-Cola, Dell, Nike, and NBC, have established their presence to appeal to their current and potential customers in the various virtual worlds. Moving beyond their initial attempt to create a mere presence through billboards and kiosks, marketers have begun more proactive efforts to explore the full potential of virtual worlds as a venue for marketing communications and interactions with consumers. Another promising business application of virtual worlds reflects the fast-growing number of consumers engaging in e-commerce in these virtual environments. For example, e-commerce transactions taking place in Second Life currently numbers in the thousands and generates significant real world revenue. Transactions involve numerous virtual items tailored for avatars, ranging from clothing to real estate.

From a consumer’s standpoint, virtual worlds provide a unique online shopping experience. In virtual stores, consumers are able to obtain detailed product information, as well as try the 3D products. Real-time interactions with salespersons and other shoppers enhance the realism and social sense of the shopping experience. Most distinctive of shopping in a virtual world is that the avatar is the consumer. Avatars serve as a surrogate for consumers in virtual worlds. For this reason, it is expected that consumer behavior in virtual worlds is different from that in the brick-and-mortar real world or the traditional online shopping environments. Nevertheless, little is known about the unique characteristics of consumer behavior in virtual settings and the potential of the virtual worlds as an effective e-commerce venue.

The purpose of this chapter is, therefore, to explore the unique dimension of marketing and e-commerce in the virtual world, namely Second Life (SL), with an emphasis on the role of avatar-based social interactions in determining the consumer shopping experience. First, we present an overview of virtual worlds as an emerging marketing and shopping venue. In doing so, we discuss two notable marketing cases to illustrate the potential of virtual worlds in engaging consumers to shop and consume. Second, we introduce the concept of social presence and provide a conceptual discussion of how avatar-based shopping in multi-user virtual environments is distinctive from shopping in other Web environments, or the offline world. Next, we report our preliminary findings of ongoing research that investigates how consumer interactions with salespersons and peer consumers via avatars influence their shopping experience in SL. This chapter concludes with a future prospect of shopping in virtual worlds and directions for future research.

Key Terms in this Chapter

Virtual Salesperson: Virtual salesperson is an employee avatar of the virtual store that helps virtual shoppers by providing product information and recommending products. These virtual salespersons are controlled by a real human being.

Second Life: Second Life is one of the most widely known non-game virtual worlds, where over 14 million internet users (as of September 2008) from around the world are registered.

Virtual Shopping: Virtual shopping is an online consumer shopping activity in a virtual world, where a shoppers’ avatar can see and interact with other avatar shoppers and salespersons while they are shopping in the digital replica of a real world brick-and-mortar store.

Avatar: 2D or 3D animated digital representation of the user in the virtual world. They are typically customized by their user.

Virtual Co-Shopping: Virtual co-shopping is a “shopping together” experience in the virtual world where multiple avatars shop together in the same virtual store in real-time.

Social Presence: Social presence is the users’ visual and emotional sense of being in the same space with other users, which is evoked by an experience of real-time communication activities or social interactions with other users in virtual worlds.

Virtual World: A virtual world is a computer-mediated online environment combining either 2D or 3D graphics with the text-based or voice message-based communication system. This environment allows multiple avatars to interact with each other at the same time.

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