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Do you know anyone who earns only through SL?


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Kwakkelde Kwak wrote:

...

So if the store you mention is the one mentioned in the interview (which it can't be anyway because of the non $4 dresses), they'd have to have sold 9 dresses an hour, since the very first day ofSL.

That's a fun calculation and quite interesting too. It actually illustrates one important point: time. I think there are two ways to make real money as a content creator in Second Life.

One is to spot the next big fad soon enough and jump on it at the right moment. Don't be the first - pioneering entrepreneurs usually fail in SL as in RL - but get in before the competition gets too stiff. If you manage that, you can make really good money for a while. It's not going to last though. Sooner or later the market becomes saturated, or people loose interest or you'll have to compete against too many other copycats. Don't be surprised if there are hundreds of 100 L$ mesh bodies for sale by the end of this year.

The other way is to come up with something that sells steadily over time. Spend a day building and listing something nice that sells steadily for a dollar a week for the next five years, yes that makes a lot of sense. But time is running out.

Here's a fairly typical example of what a typical new, not yet established creator/merchant has to face ... umm yes, that would be me. ;)

Let's say I build a house, a nice moderately big, moderately complex building for somebody to live in. That's hardly fashionable but if it's done well enough, it should be a steady seller.

So I spend two weeks building this house and then I list it for sale for 500 Lindens. Now, to be honest I'm not really a newcomer anymore. I can hardly call me an established merchant but at least I'm beginning to gain a reputation, a small but growing customer base and some experience in how SL marketing works. With that advantage and a little bit of luck the house may well sell two a month (with a lot of luck, it may even be three or four). So, four shiny US dollars a month - how long does it take to generate two weeks' worth of RL income?

Add to that the uncertainty. When you run a Second Life business, you're figting for a share of an oversaturated and declining market and you're at the mercy of some notoriously buggy and user-unfriendly software maintained by a notoriously irresponsible company who is currently desperately trying to find ways to improve their own profit margins.

So, is it possible to make a real life living from SL? Yes, people do. But the real questions are who can do it and how:

If you are in the market, manage to spot the next fad and jump on it right after it has started to take off, you can make really good money while it lasts.

If you established your business back when times were better, you should still be able to maintain a decent income if you work hard and have a big enough backcatalog of steady sellers.

If you want to enter or re-enter the market with "slow and steady sales" items: No, it's too late. For the most part the future of SL is anybody's guess right now but the one thing we can be certain of is that the market isn't going to get any better.

If you are new to the market or been away for a while and want to find the next big fad: Yes, it is possible. But considering the investment in time and money and the high risk factor, a lottery ticket is a much better investment.

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If you read The Tipping Point you will see an in depth analysis of how things become super popular. That is not the topic of this thread, but what I found interesting is that even in this era of massive constant instant communication and marketing, word of mouth is still king. Ultimately, that is how a successful business is built -- people telling other people. The trick of course is making a product that people want to talk about.

Another illuminating topic is The Long Tail, which for me was about finding a niche. I was not actually looking for a niche, I just started making a style of houses and furniture that I could not find anywhere as a customer. Apparently there were others besides me looking for this style. (I like when people who know my work well tell me they can spot something made by me because my work has a distinctive look.) Now, of course, there are lots of others making things in this style.

So, know who you are building for. For example, I build for people who like traditional and classic style, who have mid to high level computers, and are not looking primarily for the cheapest thing they can find, or something everyone else has, but something that makes their hearts sing. 

 

 

 

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Kwakkelde Kwak wrote:

 

The store you mention doesn't sell $4 dresses.

 

https://marketplace.secondlife.com/p/Indyra-Vicereine/3968524

 

You can pick the older stuff for about 1/3 to 1/4 of that but when they first came out, those too sold for L$900 to 1200 range.

 

"So if the store you mention is the one mentioned in the interview (which it can't be anyway because of the non $4 dresses), they'd have to have sold 9 dresses an hour, since the very first day of SL"

Or 100 dresses a day for much less time.

I don't see why 9 dresses an hour is so hard to accept?  I would be willing to bet dollars to doughnuts that when a new outfit is released she tops 90 dresses an hour for several days straight.

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It is hard to believe because I calculated from the moment the grid went live.

It isn't hard to believe that a store with a loyal customer base sells 90 dresses an hour when they hit the grid or marketplace, for a short amount of time. It is hard to believe that one person sells over 200 dresses a day, every day, for over a decade.

I didn't pick the priced down ones, I took an average price. It doesn't matter one single bit that they were more expensive in the past, unless you think that the majority of customers buys at full price.

How are 100 dresses a day more than 9 an hour? (???) A day in SL in not an 8 hour working day....

I would like to say put your doughnuts where your mouth is, but only for the pun :)

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Only if you want to use alchemy. According to LL there are 900,000 account logins per month and US$60 million payed out per year.  Notice that the two are not the same, as in time periods.

 First part, what is an active user and who are they. Are they a company, an education ie a university, religuose groups, under 15, peaople that log on once a month etc.

Second part, what are the pay outs and to whom and what for, stipends, rents, commercial, private sellers, tips etc.

So the first cleverly time period analogy tells you absolutly nothing, sounds good, but that is all.

Then there is this added to the figures, LL claim to have an annual income of US$500 milion and 20 employees. Sounds like SL is doing great, problem with that is, LL did not mention that SL is only 8% of LL bisiness and refuse to say how much of that 8% is of the US$500 million. Which is hardlly suprising as companies never publish where the loss and gains are.

So what is the results of all LL finacial figures about SL? Nothing, just meaningless garbage.

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Magdalena Siemens wrote:

Guys

here another fun calculation: According to the Grid Survey website (data from LL) there is 1.4 Million USD changing hands on a daily basis in Second Life. There are about 900.000 monthly active users. That means every active user spends about 46 $ per month. Not a bad market place.


Ummmmmmm did you look at the date of those statistics? Latest available data is from 29th June 2011.

 

Edit: and that's of course my point when I say it's too late now. We have no exact updated figures since LL for some inexplicable reason stopped publicizing them almost five years ago.

But in an interview Ebbe Linden let it slip that LL paid out 65 million dollars to users in 2014. There has been some discussion here what that figure actually included and the conclusion was that it must have been total merchants' income for the Marketplace. We don't really know how much is sold through in-world stores of course but it has to be much less than MP, does 15 millions sound about right?

80 millions dollars a year, that's less than one sixth of the 2011 amount. There are far more merchants competing for the sales today than back then and there's this weird thing called inflation that means a million today is less than a million in 2011 - not much but enough that it matters.

Is this where I should stand up, find my most dramatically serious voice and say "I rest my case" ?

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If you have the number of dresses sold and want to find dresses sold per hour there is no need to convert to dollars and back again.

But OK ...

1,200,000 US dollars.

1200000 / 3652 = 328. 5871 dollars per day

328.5871 / 24 = 13.6911 dollars per hour.

13.6911 / 4 = 3.4288 dresses sold per hour.

 

This is 1/3 or your hourly rate and 3 years less time.

 

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ChinRey wrote:


.

But in an interview Ebbe Linden let it slip that LL paid out 65 million dollars to users in 2014. There has been some discussion here what that figure actually included and
the conclusion was that it must have been total merchants' income for the Marketplace
. We don't really know how much is sold through in-world stores of course but it has to be much less than MP, does 15 millions sound about right?


Where did this "conclusion" come from? The logical definition of the amount Linden Lab pays out in dollars would be the amount cashed out through the Lindex.

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Theresa Tennyson wrote:

Where did this "conclusion" come from? The logical definition of the amount Linden Lab pays out in
dollars
would be the amount cashed out through the Lindex.


Yes. I can't remember the details, sorry. It may simply be that nobody, not even the most pessimistic participants, could believe things were quite that bad. Besides, Lindex transactions are suppsoed to be between residents for the most it wouldn't have been LL who paid all those millions and that's what Ebbe said.

But since we are doing fuzzy maths here anyway, let's assume 65 millions was indeed the total amount paid out to residents in 2014. And let's say the number for 2014 was 511 millions (1,400,000*365). That's a fifty percent reduction per year. Another year has passed since then.

No, forget it. It can't possibly be that bad.

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Kwakkelde Kwak wrote:

You are right,
if
the dresses are $4 each, which, as I made perfectly clear, is
very
unlikely looking at the dresses in the store you mention, or any other store I can find for that matter.

Kwakkelde Kwak wrote:

You are right,
if
the dresses are $4 each, which, as I made perfectly clear, is
very
unlikely looking at the dresses in the store you mention, or any other store I can find for that matter.

I take it you don't shop for formal wear often.

Places like Utopia or Wild Orchid normally sell gowns for L$1000 more or less.

 

Anyway, I did not make the initial claim.  Ebbe did. Since he has access to sales data I will never see and his claims do not seem unreasonable (even if it is far from typical) to me I have no reason to doubt him.

 

Your mileage may vary.

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I still find it all very unlikely, but that's not at all the point I've been trying to make. I have no trouble believing people sold 100s of 1000s of items. I must have sold 10s of 1000s myself over the years, in a niche market, plus my latest addition probably dates back to 2008.

I kept posting because someone said something along the line of "it's pretty easy to sell that much".

My point was, in relation to the title of the thread, that, according to Ebbe's statement, apparently it's only possible for the elite of the elite of SL merchants to make an income in SL for an extended period, that's considered no more than "pretty good" in RL.

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Theresa Tennyson wrote:

Where did this "conclusion" come from? The logical definition of the amount Linden Lab pays out in
dollars
would be the amount cashed out through the Lindex.

If that's the case, then many (almost certainly most) of those dollars will have been paid straight back to LL as tier, either directly or via landlords.

The more significant figure for this discussion would be the amount payed out as "process credit."    I don't sell anywhere near as many L$ as I used to when I owned several regions, but the amount that ends up in my bank, via process credit and PayPal, has increased, because I'm not subsidizing half-empty regions. 

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