Virtual Goods: Getting To The Core

At Viximo, we have evaluated dozens of companies selling virtual goods to identify and compare the common threads between successful and unsuccessful implementations. I will be sharing some of these insights through a weekly blog series called “Virtual Goods Keys to Success.” As the first post in this series the lesson is one which you should think about prior to implementing: making virtual goods part of the core experience rather than just an additional feature.

In order for virtual goods to be successful, they need to be a core part of a product’s experience. Virtual goods need to be more than just one of many features, but a thread throughout the overall social experience. Users buy virtual goods for three primary reasons: status, socializing, and winning. In order for virtual goods to accomplish one of those three goals, they need to be tightly tied with the actions a user commonly takes.

A virtual goods business model is not one that can be “duct taped” on the side of a community (i.e advertising). There is a mindset in the technology industry that you should build the least amount you can to test and see if it works. While in many cases this is an effective means of testing new ideas, in the virtual goods case this typically means the legs are cut from beneath before virtual goods even has a chance to rise. As a result, we see many failed virtual goods implementation attempts that involve a link to a storefront buried within a site, stocked with some images from iStockphoto. While a certain amount of “test” traffic will be funneled to that experience, if a user doesn’t see it as a core piece of the overall experience, they aren’t going to enter their credit card.

Virtual goods turns away from old models, such as ads and subscriptions that are interruptive and stifling, and embodies a business model that is a core part of the social experience which adds value. As a result, virtual goods is a massive opportunity, but one that requires a certain level of dedication and consistent iteration. This is part of the reason we created Viximo, to drastically reduce barriers to implementing and managing a virtual economy, while still being flexible to the differences of every community.