May 26, 2012

Apocalypse Marketplace

Are in-world stores being killed off by Marketplace? #SecondLife






I’ve been hearing this debate for quite awhile now, and to be honest, you’re all full of it. Caught up in some sort of self-delusion about what the virtual world owes you and how newer technology or methods for accessing the content you sell is damaging your in-world business.


Here’s a bit of truth:


You are the reason your in-world store is failing.


There is nobody else, nor new technology to blame, however convenient it is to look for a scapegoat for your own naivety in this situation.


Before Marketplace, you enjoyed a virtual monopoly for access to shopping, and before Marketplace you took for granted that there was no other option for your customers to turn to. Because of this access monopoly, you took it upon yourself to do things that, in the real world of business, would spell certain death to your business in the face of honest competition and innovation -


You’re not running your in-world location like a real business because up until recently, you weren’t forced to. Maybe you do on the back-end but on the forward facing part (you know, that pesky in-world location) you almost entirely ignore your customer experience. When I walk into a real world store, there are people actually working there who can help me. When I go to a real store, it’s the environment and experience of shopping that I’m there for as a first priority with actually buying things as my secondary reason.


If your store is devoid of customer service representatives or in-store associates, and nothing more than an automated self-serve automat, then you offer absolutely no compelling reason for anyone to come to your location versus simply avoiding the hassle and using Marketplace to browse and shop. When you disengage from your customers, your customers will disengage from you.


This is the same exact argument as retailers complaining that the Internet will put them out of business, and quite honestly the Internet has put a lot of businesses out of business but it’s not because they were necessarily bad – it was because they offered no compelling reason to shop there versus the online retailer. The phrase “If you build it, they will come” has never been true in retail, so stop acting like it is.


The question I ask you is -


Side by side, what can a consumer get from shopping at your retail location that they cannot get from the self-service catalog on Marketplace?


When I visit your in-world location, is there anyone working there to say “Hi, welcome to [Store]! If there’s anything you need help with today, just let me or one of the associates know and we’ll be glad to help.”


Nine times out of ten, the answer is unequivocally no.




Store Associate


Just in case you forgot the reason you go to stores in the first place



How is it that the common nightclub in Second Life hires more staff than you do for nightly parties where people stand around and pretend to dance, but when it comes to a full scale retail location in-world the thought never occurred to you that you should actually have associates and staff on hand for point-of-sale?


Then there is the expectation of location owners for staff to work on tips alone as if they’re playing an instrument on the street corner. You call yourself a business owner, and yet you’re literally too cheap to pay staff adequately for working for you, if you bother to hire anyone at all. The biggest problem with in-world locations is that we’ve been spoiled far too long on the expectation of slave labor.


What about marketing?


Do you even bother with this? When I say marketing, I don’t mean throwing astronomical amounts of L$ at the classifieds or banner advertising. But the latter might help a little (I consider banner advertising the bottom of the barrel and the absolute least you can do). What I’m talking about when I ask you about marketing are things that actual companies do – Customer Engagement.


Does your company engage with social media?


If so, do you actually engage with your customers and audience using this social aspect or are you acting like a total jackass and spamming your twitter account with an RSS feed for promotions at your store? Most of you fail miserably at social media interaction and marketing – I know this because I’ve had the (dis)pleasure of having you follow my own account on Twitter – and if you’re one of those businesses in Second Life who follow me and wonder why I’m not following back – it’s because you’re a Spamming McNinja.





Spam is not a viable marketing strategy. Get a grip.



How about cross-promotions in-world or sponsoring events that are tied to your brand in some manner? I hear that’s a big thing in the real world (where you apparently checked out of long ago).


What are you doing to promote brand awareness?


Do you sell clothing? Has it ever occurred to you to hold a cross promotion event in conjunction with a nightclub? They’re always having “Best In –“ events, and I beg to ask you if it ever occurred to you that the words “Best In –“ should ever end with the words “Your Particular Brand Name”?


How about sponsoring other events like concerts in-world where the company (yours) is raffling off prizes from your store at the event (sort of like a 50/50). The 50/50 tickets are free and everyone who attends the event is automatically entered – and then you put an entry fee for the event at the border to cover the costs and make a little money in the process. That’s how real venues work out with sponsorships. Simply make the prizes outweigh the barrier to entry and you’re good to go.


There is literally an abundance of creative marketing avenues that a majority of you blatantly ignore in favor of organizing yet another hunt (you unoriginal bas#$%ds), and yet you’re crying a river about how your in-world stores are going under. Either that or I keep hearing about moving over to places like InWorldz or another grid because it’s “better” – when really you mean “Because I get to have my monopoly back and be a lazy retailer again. Plus it’s so much cheaper over there!”


The bottom line is this: It takes money to make money.


If you are reinvesting the bare minimum back into your in-world retail location, you should expect nothing less than the bare minimum in customer response. If you are outright neglecting a majority of points that most real-world retailers address with a passion, then you are likely to go under as an in-world retail location. Countless times I’ve heard would-be entrepreneurs in-world telling me they can’t afford honest marketing or business strategy, and act like they’re owed services for next to nothing or for free. Hell, I’ve been told my own consulting fee is a “rip-off” when they really have no concept of what service they are getting and how much it’s actually worth.


Let’s say my base fee is usually $10,000L for two weeks, plus expenses related to enacting the marketing and business strategy. Is that a rip-off? Well, that equals about $50.00 US for two weeks as a retainer which comes out to well below minimum wage for a contract that normally equals $50.00 US per hour. Evidently, you should now understand that $10,000L for two weeks on retainer is adjusted adequately for Second Life, and if anything it’s a generous gift of my time. And yet, I also set that retainer price at $10,000L for two weeks specifically because I know first hand that a majority of in-world businesses aren’t serious enough to be willing to invest that much into their own benefit – so it works like an effective manner to weed out people wasting my time.


Retail Methodology


There’s a reason that retailers have quarterly inventory and products. It’s because it’s much easier to manage a smaller high volume inventory than a behemoth retail inventory with mixed results. The latter becomes a massive time sink (and you retailers in-world already know this) unless you start hiring a team to work with you in order to split the inventory work among multiple people, which most do not for a myriad of excuses. This, of course, leads to one or two people running a business in-world virtually swamped with the day to day operations of their business.


Home Depot, for instance, isn’t five people. They actually hire people and fire them. They train associates to work on the floor and help customers. They train those associates in the fine art of “The Total Sale”.





Thank you for shopping here, sir! I’ll be glad to take your money from you.


Buying a new pair of shoes? Those would go really well with our new fashion line for the Fall season. Have you had a chance to see our new line this season?


Of course you’re the reason that your retail experience sucks. It’s not Marketplace.


There is literally nobody on your retail floor to qualify customers and up-sell the total package when available. Your store is the equivalent of a self-serve experience, which happens to be served better through Marketplace. If you fail to plan, you’re planning to fail.


I go into someplace like Hoorenbeek in-world and I make a bee-line to the shoe section, completely ignoring the rest of the store. I have no compelling reason to look around, and nobody works there to make that recommendation to me or help me out on-location. The reason I stick with Hoorenbeek for shoes is because the quality of their shoes is really good – but more importantly, it was a customer service experience with them that made me into a long-term customer. I have their sneakers, and noticed it had no option to turn off Full Bright, making them essentially glow at night. I messaged them asking if I could get a pair with Full Bright turned off, and made a suggestion to them about building a menu option into future releases allowing people to toggle that option.


Within a few days I received a message back, and shortly after I was given a pair of sneakers with full bright turned off. I know we can’t be everywhere at once or handle every little detail… but we can assemble a team of associates to scale this experience for the benefit of the business and the brand – but more importantly, for our customers.


Knowledgeable associates on location would be absolutely whiz – just ask Bax Coen Boots.


Why would I recommend Bax Coen over higher end retail locations?  Actually having customer service and on-site associates to help customers. That is a compelling reason to shop there instead of Stiletto Moody. Better prices, and while they have a limited selection compared to other places, the feeling that Bax Coen actually gives a damn about her customers trumps $5,000L brand name Stiletto Moody’s any day.


As a matter of fact, for a store that charges obscene prices for their products, and a brand name at that, it is a complete and total insult to their customers that they do not reinvest that money adequately back into the business in order to make the shopping experience better. It is a sign of complete contempt for the customer when a brand rests entirely on its laurels and does little to nothing in order to reinvest in the shopping experience.


Does that mean this conversation is a matter of In-World locations versus Marketplace?


Not at all.


It means that Marketplace should be effectively utilized as your retail back channel. You keep only the quarterly inventory (new releases in inventory for the quarter) at the retail location, and move the last quarter inventory into Marketplace as a back sales channel. Every 4 quarters you effectively retire last year’s inventory from Marketplace, with a yearly holiday end of year sale (50% off) and move on.


The quarterly new releases are the only items available at the retail location, and not available on Marketplace until they are moved out of the store to make room for the next quarter new releases.


That effectively gives you a smaller (and fresh) retail inventory every 3 months, while retaining the last quarter inventory until the end of the year at a 25% discount, and for the holidays you clear that past year inventory out by doing a 50% sale.


Now we have a compelling reason to start shopping at the in-world retail location.


However, just because you get your retail in line, doesn’t mean you get to keep your customers on this alone. Now, you need to take it a step further and start treating your in-world location like the retail experience it should be. I’m just providing a bit of free advice from an actual professional here, but by no means should you take it as a complete strategy.


I can go into far more details from the point of view of an actual marketing executive, but this is a limited blog and your time is valuable (as is mine). I used to deal with this situation on a daily basis when I worked at Pulse Point Media as their VP of Operations – wherein it was my job to assess client situations and make recommendations, and even advise whether or not the company should even bother taking a client at all. I had a similar role when I was younger and working for Janez Digital Media years ago. Needless to say, most of the in-world clients that came to us were outright ignorant of what they really needed to do in order to grow a brand and business, and in some situations outright hostile and “know-it-alls” who completely disregarded everything a consultant would recommend, even going so far (in some occasions) as to do the complete opposite.


Is it any wonder your in-world locations are collapsing faster than a house of cards?


Simply put, most just want it all handed to them on a silver platter for next to nothing (and free if they can get it). I hate to be the bearer of bad news, but it’s time to start acting like you’re actually serious about your business for once and treating marketplace not as your enemy, but as a viable tool to strengthen your business and brand, both in-world and through the web.


Before you get any bright ideas, let me make myself perfectly clear:


If you’re thinking about contacting me in-world for this as a consultant, the fee is non-negotiable (don’t waste my time trying). I reserve every right to cancel the consultation during the process if you act like a complete ass and willfully sabotage or blatantly ignore a majority of the recommendations. There is no refund – so don’t waste my time and I won’t waste your money.


That being said, I’m pretty sure I’ve eliminated a majority of you reading this from bothering me. There is no magic bullet or easy way out when it comes to retail and marketing. There is, however, a lot to learn and a lot to apply not just during the two weeks but going forward after my time expires. It is an ongoing process, not a one night stand. If you aren’t in a position to address this in a serious manner, nor have a budget to work with – you’re on your own.


If you’re still feeling brave – go ahead and contact me in-world: Aeonix Aeon.


  1. Bravo! what i have been saying for years!

    1. Thank you :) I would think it's just common sense, yet there are so many people still crying foul over Marketplace.