Harvard Business Review

AVATAR BASED MARKETING

By Paul Hemp

The author first talks about how in the online world, people can create avatars or online world
representations of themselves. With the advent of these avatars, people are able to participate
in virtual businesses, interest based social groups, and scheduled events that range from dance
parties to celebrity book signings to boxing matches to yard sales. There seems to be a lot of
engaged minds involved in these online activities and it provides a good opportunity for
marketing but the question arises as to to whom will the marketers direct the marketing effort.

Even though the real world consumer controls the avatar, the avatar actually represents
only a shadow of the real customer. But this shadow can be capable of influencing the
customer’s decisions to buy real world products and also offer the marketers some insights into
the customer’s hidden tastes.

The author elaborates on the different places where avatars are extensively used by
people. One such area is an massively multiplayer online role playing gaming where people’s
avatars can build skills and abilities and also engage in combat etc.

The biggest advantage of marketing to avatars is the consumer engagement with the
brand. This occurs through interactions with the avatars. An example of marketing through this
virtual world is Dominus Motors promoting a car through Second Life. This proves to be
effective because Second Life has currently around 65000 paying subscribers and another
100,000 nonpaying members with fewer in world privileges.

There is already a large amount of marketing taking place in the virtual world which
suggests the real world marketing potential of the online world. According to Linden Lab more
than 3000 people earn real world money from their Second Life businesses averaging 20000
dollars a year. The combination of robust virtual world commerce and the growing overlap of
virtual worlds and real worlds suggests oppurtunities for creative real world marketers.
 The real danger in this form of online marketing is that products in the virtual world will
feel like spam. To be effective, marketing in these worlds needs to be consistent with the virtual
experience and enhance the participant’s experience. The advertisements try to target the
powerful consumer alter ego : that attractive, incredibly popular person just waiting to emerge
from the all-too normal self.

The real challenges and real risks involved could be many. The first question is that will
consumers actually buy a product spending real dollars just because they bought it in the virtual
world spending imaginary dollars? In addition there are technology constraints. Strong
resistance to real world commercial encroachment still exists in many virtual worlds, where
users primarily seek an escape from real life. Also due to the various cultures followed in
different parts of the world, a single approach won’t work.

Clearly this is a virtually unexplored marketing territory. But conceiving of avatars and
other online personae as a new set of customers, one that can be analysed and segmented,
provides for new oppurtunities for marketing.