Viral marketing and customer acqusition strategies

This is a post about customer acquisition strategies for KT&T (kids, tween and teen) virtual worlds.

How do newly launched virtual worlds attract sign-ups (users, members, residents, customers, etc etc) during open beta and early launch stage? Or to be more precise, what are the marketing strategies developed for these worlds?

As someone with agency and client-side experience in marketing and advertising, this is a topic close to my heart and also a topic paramount to the success of virtual worlds.

The vast majority of virtual worlds seem to be relying on viral activity as the primary (or in some cases only) method of attracting new sign-ups and for some worlds this is a one way street to failure,particularlyfor worlds classified as pure-play – developed and created specifically for the virtual space with no real world brand awareness or presence.

It’s a flawed strategy because:

• They have no real-world customers to leverage into their world
• Their brand means nothing – it has no value or equity

So, for pure-plays the road to acquisition starts at zero (or maybe K Zero ;)) and it’s a long road to walk with competitors around every corner. Yet they still base the crux of their marketing strategy on viral. This problem becomes increasingly compounded with a lack ofdifferentiationbetween offerings. Worlds in the KT&T space are casual gaming or socialing plays, or a mixture of both and there’s little to tell them apart, except that they probably start with the letter Z, Y or X.

So unless these pure-play worlds can either create a new compelling sub-category or create atrulyunique proposition, they’re going to find it extremely hard to acquire new customers using viral alone – they need to develop a marketing strategy. After all, taking a step back from this a little, should the latest form of social engagement and online immersion be left to using the worlds oldest form of marketing for it’s success? I think not.

Virtual worlds based on real world brands have a much easier path. They have existing customers, measurable levels of brand awareness and importantly, established communication channels to exploit with their new messages. And, let’s not forget they already have teams of marketers who understand these three elements because that’s their job, day in day out.

Pure-plays have a much harder challenge to acquire new sign-ups but this doesn’t mean it’s impossible.

What is means is that sooner or later (sooner if they want to succeed and later if they want to just become noise) these pure-play virtual worlds need to ‘take it to the streets’ and start advertising their platforms. This also means they need to build higher marketing costs into their business plans (and funding plans if they’re in dev mode).

What methods of advertising or promotion are currently being used by worlds that don’t just rely on viral marketing?

Most virtual worlds appoint PR agencies. Seems like a pretty good idea – create a comms plan, build a candidate list and get the messages out. This is a good strategy for worlds that allow brands into their worlds as part of the audience will be marketers with budgets. But it confuses me slightly when virtual worlds less reliant on third-party marketing dollars rely heavily on PR agencies. Do kids read press releases, newspapers, websites or blogs? Does PR effort influence KT&T’s into joining new virtual worlds? Not really.

Virtual worlds presence at conferences is also common. Again, this makes sense if the worlds in question are looking to attract brands in – as long as these brands are present. But this doesn’t work when the primary revenue driver for these worlds is from resident income (via premium subs, virtual goods etc). The kids don’t go to conferences. This might sound obvious but you’d be surprised how many of these worlds allocate marketing budget to stands/sponsorships at expos.

So what about TV, radio and print channels?

Here’s an interesting one. Although not strictly classified as a virtual world, World of Warcraft is a 10m+ (registered account) platform. In other words, WoW is a big-boy. Surely then WoW IS a world that can rely on viral marketing as they have millions of members out there available to spread the word. Think again, and watch the videos below.

Notice the subtle target audience tailoring in these ads? They cater to different age demographics based on the actor selected and the genre of the shows they’re famous for. WoW is going after a wide mix of ages. But they’re not stopping there. Regional targeting is also part of the media mix.

And TV doesn’t have to be expensive. Smart media plans opt for regional targeting (like WoW) to stimulate interest in specific territories and utilise the already wide array of channels catered towards KT&T’s.

How important is radio or print? Less important in terms of reaching out directly to the target audience but bear in mind that the Moms and Dads are the secondary target here.

Let’s move onto online advertising.

Does PPC work? Some worlds are already using this channel. Here’s some results for kids/teen virtual world phrases.

I have two issues (which may or not actually be issues). Firstly, I’m unconvinced that kids and teens actually use search engines. So response from this type of advertising could be low – but at least the cost of this initiative can be controlled. Secondly, this type of advertising only works if the searcher (the potential member) is actively searching for a virtual world. It totally bypasses someone looking for online games, for example.

What about banners and richer online media? On a CTR basis, I would assert that these perform better than PPC – and IMVU uses this channel well already.

Partnerships with complementary media/marketing partners is another viable option. Virtual worlds are THE hot property at the moment and partnering up with say a kids or teen magazine has benefits to both parties. The titles in question are presented with a very low risk avenue into the metaverse (i.e. not needing to develop their own world) and obviously have web-properties and existing readers. The world obvious has the benefit of piggy-backing on this. Throw in other companies such as FMCG in the mix here as well.

Partnering with TV channels is another potential option, but take MTV off your list obviously.

To summarise, virtual worlds building brands and platforms from scratch without real world awareness can not relysolelyon viral marketing to grow their businesses.

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