Arvetica: Second Life for Businesses - Introduction

Slide 1: Second Life for Businesses what is your company’s strategy for the virtual world? January 2007

Slide 2: Second Life level of expertise? Second Life I can do it novice expert

Slide 3: agenda 1 4 2 understand execute explore design 3

Slide 4: UNDERSTAND what SL is?

Slide 5: Second Life (abbreviated to SL) is an Internet- based virtual or synthetic (3D) world in which everything is built by its residents.

Slide 6: SL is inhabited by residents, which is how the users of SL are called. They “live” in this virtual world in the form of an avatar.

Slide 7: AVATAR = USER

Slide 8: analogy: think marionette

Slide 9: "avatar" stands for a user's “virtual” representation (e.g. three-dimensional model). It is derived from the Sanskrit word Avatāra:incarnation.

Slide 10: your virtual marionette : your avatar socialize exchange trade

Slide 11: exploring identity

Slide 12: economics politics sociology culture property symbols conversation entertainment no comment Second Life has most ingredients of a society

Slide 13: user numbers accounts (curiosity): 4.1+ mio. logged last 60 days: 1.5+ mio. online simultaneously: 16k – 32k premium accounts ($): growing user hours: growing

Slide 14: Second Life actors create represent govern collaborate sell land engage coding hold events authority trade test « live » companies create/build socialize trade users

Slide 15: architecture & building activities entertainment selling fun selling relaxation

Slide 16: does SL have an economy?

Slide 17: basics of a market economy A market economy is an economic system in which the production and distribution of goods and services takes place through the mechanism of free markets guided by a free price system [...]. In a market economy businesses and consumers decide what they will produce and purchase. Wikipedia 2007 economics is usually defined as the study of choice under scarcity. [Scarcity] forces us to choose where to allocate our resources as to obtain the best mix of desires that we can. Castronova 2005

Slide 18: creating objects & property rights 1. you retain copyright and intellectual property rights of all content you create in Second Life 2. Linden Lab retains ownership of the account and related data, regardless of intellectual property rights [..]

Slide 19: owning land & building islands price: US$1,675 (65’536 m2) monthly land fee: US$295

Slide 20: trade in SL

Slide 21: Linden Dollar : L$ Second Life "currency" is a limited license right available for purchase or free distribution at Linden Lab's discretion, and is not redeemable for monetary value from Linden Lab.

Slide 22: currency exchange SL operates a currency exchange, the LindeX. Use and regulation of the exchange is at Linden Lab's sole discretion. Daily Volume: 200’000+ USD

Slide 23: banking in SL Ginko Financial Statistics, Feb 1, 2007 Total deposits L$117’745’637 Total account 13’944 Avg. Transactions/hour 47.9 7 day Statistics Total Volume L$60’599’122 New Accounts 239 source:

Slide 24: Greenspan vs. Rosedale Size of economy $1 trillion per month $7.7 million per month supervised God-like power Controlled currency rate by manipulating Controls currency rate by manipulating money money supply supply Libertarian tell Youthful acolyte of objectivist Ayn Rand Second Life doesn’t really have regulations Technique to Ensures that the L$ doesn’t appreciate against Ensured low interest rates by making it encourage maximum the US$ by making it impractical and impractical and unattractive to keep US$ spending unattractive to keep Linden Dollars in savings in savings accounts. accounts. Powerful backer Four US presidents Jeff Bezos, CEO of Amazon.com Means of maintaining Reducing the supply of money by Aggressively adding money to the currency price stability aggressively raising interest rates when supply as the overall size of the economy inflation begins to rise. increases. source:

Slide 25: EXPLORE the SL business space

Slide 26: RL company presence in SL engage/ business utility (future revenue) prototype build relations and test collaborate trade events represent/ advertise user/avatar (client) interaction

Slide 27: 1. buy land or island 2. build presence 3. announce (press) 4. wait for SL residence represent

Slide 28: 1. create billboards 2. buy ad space 3. advertise to SL residents advertise

Slide 29: 1. enter SL with your employees 2. find/build meeting space 3. invite 4. collaborate collaborate in-world

Slide 30: 1. buy land or island 2. build object or prototype to test 3. announce (e.g. press/SL) 4. wait for SL residence 5. gather feedback and improve prototype & test

Slide 31: 1. buy land or island 2. create playful experience 3. announce (e.g.press/SL) 4. (advertise to SL residents) 5. wait for SL residents 6. engage visitors engage

Slide 32: 1. buy land or island 2. build object to trade 3. announce (e.g.press/SL) 4. (advertise to SL residents) 5. wait for SL residents 6. trade trade

Slide 33: 1. buy land or island 2. organize event 3. announce (e.g.press/SL) 4. (advertise to SL residents) 5. wait for SL residents 6. hold event events

Slide 34: 1. plan cross-channel relationship 2. buy land or island 3. announce (e.g.press/SL) 4. cross-channel marketing 5. build & maintain relationships build relations

Slide 35: innovative projects 1. brainstorm for innovative projects 2. design & implement 3. succeed

Slide 36: what about the future?

Slide 37: which scenario is more likely? b) 2009: Second Life was nothing than a fad - nobody talks about it anymore e) 2009: Second Life is "business as usual" – the majority of big brands is present in SL

Slide 38: LIFT’07 workshop virtual worlds will play an important role for Fortune Global 500 companies YES or NO

Slide 39: SL – condemned to fail (NO) 7 of 15 people believe that virtual worlds will NOT play a major role in Dec 2009 (5 of these persons believe that virtual worlds will eventually play an important role within an extended timeframe) s vote NO 7

Slide 40: SL – the party goes on? (YES) 8 of 15 people believe that virtual world will play an important role in Dec 2009 (of these 8 nobody believed SL would be this virtual world) s vote ES 8Y

Slide 41: DESIGN & IMPLEMENT a SL presence

Slide 42: do’s / don’ts do’s • know your « customers » • provide fun, sticky interaction don’ts • don’t slow down things • don’t do a one-shot Second Life lessons

Slide 43: learn from BMW lack of interactivity / they got the SL concept wrong

Slide 44: develop a SL presence 1 4 2 understand execute explore design 3

Slide 45: statistics http://nwn.blogs.com/nwn/2006/10/why_mixed_reali.html#more

Slide 46: design studios

Slide 47: THE END http://www.slideshare.net/Alex.Osterwalder/arvetica-second-life-for-businesses-introduction

Slide 48: 2 day Second Life immersion workshop 19-20 April 2007 Arvetica, Geneva

Slide 49: next arveticasts • Improving the Strategy Process – what strategists can learn from architects – Thu, April 12, 2007 • Strategy Grand Tour – Thu, April 26, 2007

Slide 50: Arvetica. who we are.

Slide 51: We believe that superior economic performance comes from sharing knowledge and not from keeping it.

Slide 52: We do not try usual formulas. We deliver unique solutions through multidisciplinary approaches, ad-hoc teams, visual thinking, and rigorous project management. We have high impact.

Slide 53: Arvetica is a management consulting company. We design strategies, develop business models and manage projects for private equity investors, start-ups and large organizations.

Slide 54: arvetica.com