It’s All Virtual Turns Two

December 12, 2010

“Time flies when you’re having fun.”

It all started two years ago today.  The first blog post was made on December 12, 2008.  Since that time, I’ve covered virtual trade shows, hybrid events, virtual worlds, Second Life, social media and many other topics.  It’s been a fun ride to date, but I’m even more excited about what the next 2 or 5 years will bring.  For now, let’s take a look back at five selected posts from the past two years.

What Started It All


My first post, from December 2008, looked ahead to 2009.  It was titled “2009: The Year We Go Virtual“.  I was mostly on target with this post, except for that innocent comment where I noted that face-to-face event producers would struggle to survive.  I should have known that physical events would never go away – and, I hadn’t considered what would follow in 2009/2010, the hybrid event.  Whoops.

Lenovo’s 3D World, Powered by web.alive


This posting, from January 2009, remains today the top grossing piece on this blog.  Lenovo launched a 3D world to promote their Thinkpad notebooks.  It used the web.alive 3D platform from Nortel (and is now part of Avaya, via Avaya’s acquisition of Nortel).  While touring the environment, I met Nic Sauriol, the Venture Lead for the project and he took  me on a personal tour.  Read more: “Review: Lenovo’s eLounge Virtual World“.

Musings on Physical Events & Virtual Events

(Photo courtesy of “ExhibitPeople” on flickr)

Physical events have been around for a long time.  So I decided to write about what we like at physical events and consider how those “features” could work in a virtual event.  I didn’t expect it at the time, but this turned out to be one of the most popular postings this year.  For more: “Bringing The Physical Event Experience To Virtual Events“.

Whose Platform Do I Use?

Once you’ve decided to do a virtual event, one of the key steps is finding the right virtual event platform.  In my Virtual Events 101 series, the most popular posting was this one: “Virtual Events 101: Tips For Selecting A Virtual Event Platform“.  For me, it comes down to the 6 P”s – People, Platform, Production, Price, Process and Partners.

Branching Out A Bit

Branching out from virtual events, I shared some thoughts on the topics of social gaming, location-based services, “gamification” and loyalty programs.  In the coming 1-3 years, gamification, location services and virtual events will come together (via API’s and integration).  On the gamification front, it’s noteworthy that San Francisco will be home to the Gamification Summit in January 2011.  For the full post: “The Name Of The Game Is Engagement“.

Conclusion

It’s been a great two years.  It’s hard to imagine what the (virtual) “world” will look like in another two years.  There’s one thing for sure: I’ll be blogging about it.  Come along for the journey and subscribe to regularly receive my posts.  Until next time!

2 Comments | Virtual Events | Tagged: , , , , , , , , , , , , , , , , , , , , , , , | Permalink
Posted by Dennis Shiao

The Name Of The “Game” Is Engagement

August 9, 2010

Future brand loyalist or virtual goods buyer?

Introduction

Social gaming start-ups are a hot commodity these days.  In the past 12 months, Playfish was acquired by Electronic Arts and Playdom (more recently) was acquired by Disney.  Zynga, which remains independent, has a valuation that’s reported to be as high as $5B.  I expect that CrowdStar, another independent gaming start-up, will be acquired before 2010 closes.

These gaming companies provide “free to play” games on the web and on smartphones.  They then sell virtual goods (within the games) so users can achieve an elevation in status (e.g. a sharper sword, more crop for the farm, designer sunglasses to replace your generic pair, etc.).

Sustainable Growth Can Be Challenging

These gaming start-ups have attractive attributes:

  1. Ability to generate hundreds of millions in revenue (in some cases, more)
  2. High growth rates in users, revenue
  3. High profit margins, since the “cost of goods” (for virtual goods) is virtually zero

While it’s hard to argue with the results that these start-ups are turning in, I wonder if we might be in a mini-gaming-bubble, in terms of current valuations and the potential of sustainable, long term growth.

Social games can be similar to the recording and film industries.  Success depends on the blockbuster hit.  Over time, it becomes more and more challenging to consistently produce the blockbusters, especially in the face of growing competition.  Today, Facebook serves as a great “record label” for the gaming companies.  It provides a marketing vehicle that you can’t find anywhere else – “distribution” to its 500+ MM “listeners” (users).

The gaming companies know, however, that they can’t put all their eggs in the Facebook basket – hence, the plans from Zynga to launch their own Zynga Live platform (as one example).  The gaming companies need their blockbuster hits to turn into self-standing brands (e.g. FarmVille), which then relies on a variety of distribution vehicles.

We know that consumers can be fickle, however.  Recall the progression of “hot social network”, from Friendster to MySpace to Twitter/Facebook.  Games will have a related challenge.  FarmVille is not going to be the #1 game forever, which means that Zynga is already figuring out the “next FarmVille”.

I believe there will be a short list of winners in a market that will be increasingly fierce.  In addition, I wonder if over the long term, the rate of virtual goods purchasing is sustainable – or whether it will continue to grow over the long term.

A New Game in Town?

One of the challenges of the virtual goods model is the funding source. Revenue growth is dependent on fickle consumers, who could love your game one day and move on to another game the next day.  And yes, I realize that part of good game design is to build in the hooks to create user loyalty.

That being said, what about services whose funding source comes from brands that want to reach consumers?  The bills in their “wallet” are of higher denominations than the $1’s and $5’s that consumers use to purchase virtual goods.  In addition, “brands are already brands”, which mean that they have a pre-existing following from consumers.

Foursquare

Consider Foursquare.  Some consider it a “location based service”.  I view Foursquare as an engagement platform that’s built on top of a location based system.  In fact, Foursquare has a loyalty program that generated successful outcomes for Starbucks, Ben & Jerry’s, Whole Foods and many others.

The Foursquare business model is both powerful and scalable: powerful in its use of technology (e.g. location based check-ins) and scalable in leveraging existing brands (e.g. Starbucks) for the consumer following and activity.

Location based technology is great, but the long term success of Foursquare is more about the engagement and loyalty programs it facilitates for brands, based on the applicable and available technology of the day.

Nitro Participation Engine from Bunchball

Keep your eye on the Nitro Participation Engine from Bunchball – a Silicon Valley start-up who counts NBC, Warner Brothers and Victoria’s Secret as clients.  The Nitro engine “drives participation using Gamification”, which means that any brand can easily add gaming elements to their web site(s) – and then leverage the Nitro engine to track user actions, points, status and leaderboard. In addition, brands can use Nitro to deploy and sell virtual goods.

What This Could Mean

I think we could be witnessing a transformation of the advertising industry.  If the 90’s and the 00’s were about banner ads and paid search, this coming decade could be about engagement and loyalty platforms.

Foursquare, Bunchball and others have much to gain – if they can tap into a small percentage of the $100+B spent on advertising annually, they’ll make their investors very happy.

These engagement platforms can move from brand impressions (90’s) to brand engagements – where the engagements are longer lasting and more valuable than a click on a paid search ad.  They’re more participatory and can result in immediate purchases (e.g. the latte that someone just purchased at Starbucks).  In addition and perhaps more importantly, they enhance loyalty between consumers and brands, which is great for the long term.

Of course, sustainable growth is a challenge with any technology. Engagement platforms will face their own challenges as they see adoption grow.  Consumers will only be able to participate in so many engagement or loyalty programs.  That being said, consumers are taking batting practice right now – the first inning has yet to start.  Enjoy the ballgame!

I’ve now managed to speak enough.  Leave a comment below to share your thoughts on this topic.

Related Links

  1. ClickZ article (by Christopher Heine) on brand engagement featuring Booyah, Loopt, Brightkite, Gowalla and Stickybits
  2. “Foursquare’s Future Slowly Takes Shape“, by Om Malik of GigaOM
  3. “Social-media games: Badges or badgering?“, by Caroline McCarthy of CNET

4 Comments | Social Gaming | Tagged: , , , , , , , , , , , , , , , , , , , | Permalink
Posted by Dennis Shiao

How Virtual Events Can Adopt Location Based Services

January 28, 2010

These days, it seems the social web is like real estate – it’s all about location, location, location.  Foursquare, Gowalla and Loopt are gaining popularity as location based, mobile social services.  Yelp has rolled out Yelp Check-ins, which mirror a popular activity on the aforementioned services.  Twitter added location awareness to its API in 2009.  Facebook, some speculate, may enter the fray with their own location based services.

So how would it be possible to enable Location Based Services in a virtual event?  Well, consider that location tracking is inherent to the virtual event platform – in other words, it has a built-in GPS for all users!  I wrote previously about gaming in virtual events – that gaming can generate  retention, engagement, enjoyment and loyalty.  Location Based Services, in the form of competition and gaming, can achieve all of these benefits.  Let’s take a look at how.

Source: flickr (User: dvxfilmerdoug)

It Starts With The Buddy List

Users first need to build their social graph.  This can be accomplished with a virtual event platform’s “buddy list” feature – all users in your buddy list would receive status notifications from the location system.  The notifications would be sent to users within the virtual event (if you’re logged in).  Once you log out, you can opt to receive status notifications via email.  This way, even if you’re no longer in the event, you can receive updates (via email) on what your buddies are up to.

Build A Reward System

Next, a reward system serves as an incentive for users to participate.  The concept is similar to the becoming “mayor” of a location on Foursquare.  In a virtual event, perhaps you allow privileged users (who have achieved a certain status) to obtain a badge – whereby the badge can superimposed on their avatar image – or, listed on their profile page.  In addition to the badge system, a master leaderboard (and perhaps segmented leaderboards) should be utilized, allowing users to track their performance relative to other users.

The Virtual Trade Show

First, the notion of a social graph in a virtual trade show may be an upfront challenge.  At most trade shows, you may know a handful of colleagues or associates who are also attending – but for the most part, everyone else is a stranger (to start).  Thus, a system may need to be in place first to encourage users to add other users to their buddy list.

Assuming you can achieve decent-sized buddy lists, then the “check-in” becomes quite relevant in a virtual trade show.  Each visit that I make to an event area can be tracked (by the platform) as a check-in – allowing my buddies to know what areas I visited – and, where I am right now.  Secondly, I might leave a review or comment about a particular area – perhaps I enjoyed the content in an exhibitor’s booth – or, I didn’t find a Webcast to be all that useful.  When my buddies enter those same areas, they can then view the comments I left them from my prior check-ins.  Thus, when a buddy enters the same exhibitor booth, she knows that I visited earlier and enjoyed the content there.

Exhibitors could then sponsor areas of the event (besides their own booth) – the Lounge, Auditorium, Resource Center, etc.  Then, attendees can vie to become the “mayor” of a given area.  At the end of the live event, perhaps the mayor of the Lounge receives a prize that’s awarded by the Lounge’s sponsor – and to receive the prize, agrees to have a short conversation with that sponsor.  Already, you can begin to see how this location “app” can generate additional activity and engagement.

Source: flickr (User: Live Solutions)

The Virtual Sales Conference

In a virtual sales conference (and related corporate events), attendees naturally have a large list of potential buddies – the trick is to incent the attendees to populate that list within the virtual event.  Alternatively, management may choose to pre-select the buddy lists by organizing the sales force into teams – whereby your buddy list is pre-seeded with your fellow team members.  The location app is all about checking in (with each other) and sharing information towards gaining points for your team.  In this manner, the location app helps encourage learning and collaboration, making the virtual sales conference more effective.

Social Networks

For certain types of events (e.g. virtual trade shows), integrating the location system with users’ social networks can be powerful.  For instance, a check-in to the keynote presentation can auto-generate a tweet out to the attendee’s Twitter followers – providing a registration link to the event.  Similarly, a check-in at an exhibitor’s booth may prompt the user whether she wants to post an update to her Facebook wall.  In summary, the location service should facilitate sharing not just within the virtual event, but to external social networks as well.

Prevent Gaming (of the System)

The virtual events platform will need to carefully build the measurement and scoring methodologies to ensure that the “game is not gamed”.  In the real world, there is overhead involved in becoming the mayor of a watering hole – in the virtual world, clicking 50 times to enter an exhibitor’s booth is quite easy.  The scoring system ought to consider rate limits, as well as threshold values around selected activities.  Additionally, becoming “mayor” should factor in actions that are not as “game-able” as mouse clicks or visits.

Conclusion

There’s  probably a lot of work to enable the underlying platform to accomplish this – however, such a system can go a long way to achieving retention, engagement, enjoyment and loyalty.

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1 Comment | Virtual Tradeshows (VTS) | Tagged: , , , , , , , , , , , , , , , | Permalink
Posted by Dennis Shiao

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