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Market Business Model: Feedback Please


Farthington Whetmore
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Greetings.

I am trying out a new market business model on my RP GCS demonic horror themed sim and need to market it accordingly.

Now I know consumer traffic is way down directly affecting the economics of Second Life and as such, it can be hard for content creators to afford and maintain their rental tiers. So I am thinking about offering free retail space for qualified content creators whose products align with the theme of the sim.  

The objective here is to create a one stop shopping destination for demonic and horror fans and hopefully entice a steady flow of qualified consumer traffic. The strategy behind the free retail space is essentially a means of "Papering the House" if you will, or populating the Horror Market aspect of the sim and ensuring tenancy longevity.

I am already paying for the sim so critical primary revenue infrastructure is not required in order to support the sim. However, secondary and tertiary revenue streams are identified as increased traffic flow into my store located on the sim, Ad Boards, and non-obligatory tenant donations if tenants are experiencing satisfactory sales and would like to express their appreciation for the free store. And of course there are visitor donations.

So does this sound like a viable business model? Has anyone tried this before, if yes, how were the results? 

What and where would be the best way to market this?

Your feedback would be appreciated and if you are interested in learning more and would like to see the sim setup, please visit  http://maps.secondlife.com/secondlife/Wild Shores/128/106/25

Thanks for time :)

 

 

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@Farthington Whetmore

Here are some of my random thoughts on the subject.

A satellite store is not really going to generate much in the way of new traffic. Those types of locations are better suited for generating impulse type purchases and for brand exposure on the part of the creator. If I as a consumer stumble onto a satellite location and am interested in their products then generally I am going to grab a LM and go to their mainstore. That isn't going to do much to drive future traffic back to your sim. Under your plan that isn't going to really benefit you in any way and IMO it is wasting a commodity that you have.

From your perspective it would make more sense if that vendor had their mainstore located on your sim. If that vendor has a mainstore then all their marketing efforts are invested into driving traffic to that location. Sure they could advertise satellite stores (as some do) but most of the time they don't have the full assortment of products there (hence the reason it is a satellite store). So what is the incentive on the part of the buyer?  If a recognized brand were to have their mainstore on the sim then I'd expect traffic to go up.

In your post you said that this plan would be to help ensure tenancy longevity. Well I think that would be easy to do if your plan is to charge nothing. I'd however caution you on doing that.

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It's an interesting concept, Farthington.  I'm looking forward to seeing what others think.

In the meantime here are some thoughts off the top of my head.

IMHO running a successful RP area is all about nuturing the community.  That will ultimately drive the right traffic to your area & benefit both your RP & retail endeavours.  I tend to agree with Chase01 that satelite stores (especially free ones) are not what you're looking for UNLESS those owners are also contributing to your RP community in other ways.  Have you thought of making the retail spaces a part of the RP itself?  Perhaps merchants get the spot for free but are there to RP at certain times.  Interaction with players/customers both through regular & special events is a good way to increase traffic & keep community interest high.

As far as donations go, it's been my experience that you will receive a bit from visitors (not much to write home about) but it's the community that will be the backbone of your support.

Good luck with your venture!

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Thank you for your feedback Chase01. 

I understand what you are saying as I have a tendency to shop in a similar fashion but for expensive items, I will check their main store first for an actual visual of the item and then make a purchase on MP so I can leave a comment if merited.

As stated, I am interest in the one stop shop horror destination with a variety of brands representing the Horror Market theme. It's not just the individual satellite stores but rather the collective concept of the Horror Village which includes the Horror Market nested within a horror/demonic RP environment that would be the traffic generator. 

I have had tremendous success with satellite sales over the years on seasonally themed Pop-Up sims, especially at Halloween and this is what has inspired my concept. The difference being is my  market  won't just be for a couple of months and the stores would be free. My main store The Whetemore Group will anchor the market.

Also traffic at my sim explodes in August, September, and October as people get ready for Halloween so I think creators would benefit from satellite sales :)

Edited by Farthington Whetmore
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49 minutes ago, TatianaDokuchic Varriale said:

It's an interesting concept, Farthington. 

Thank you :)

IMHO running a successful RP area is all about nurturing the community. 

Yes you are right but it starts with an interesting destination and I believe I have created that.

I tend to agree with Chase01 that satellite stores (especially free ones) are not what you're looking for UNLESS those owners are also contributing to your RP community in other ways. Have you thought of making the retail spaces a part of the RP itself?

I reiterate the free stores are part of the "decor" and are not revenue generators for me.   Their contribution to the RP community would simple be their presence in the market: One shopping in a Horror market on a Horror Sim would not expect to find a store full of cute breedables or baby clothes... so is that not also being part, albeit in very passive way, of the RP itself?

Interaction with players/customers both through regular & special events is a good way to increase traffic & keep community interest high.

Yes and this will be developed and implemented as the sim evolves. 

As far as donations go, it's been my experience that you will receive a bit from visitors (not much to write home about) but it's the community that will be the backbone of your support.

Again I don't need the revenue so all tertiary forms of revenue such as a trickle of visitor donations would simply go back into the community in one form or another.

 

 

 

Edited by Farthington Whetmore
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2 hours ago, Farthington Whetmore said:

Their contribution to the RP community would simple be their presence in the market: 

A golden rule of SL: if you're satisfied with your ROI that's all that counts.

I've been the co-owner of a Historical (RP) Estate for nine years; this activity includes being a landlord (retail & residential), running my own business, and tons of community involvement.  Having an interesting destination and no money worries makes for a great start.  The challenge (for me anyway) is time because the community is going to take all that you can give and still want more.

Being a landlord is my least favourite activity.  Not only does it consume prims (you can always use more LI) but more importantly it takes time.  Good tenants are worth their weight in gold.  Bad tenants (don't follow your covenant, always exceed their prim limits, pick fights with other tenants, etc. etc.) are to be avoided at all costs because they're time consuming. So how do you attract good tenants? 

It seems to me that rewarding people in the community with free space is a good means of vetting tenants.  Advertising free space to the public at large, not so much.  You would have to be really careful with your vetting process to find "qualified content creators" and your marketing approach to avoid the perception of being desperate .  It certainly is an interesting challenge.

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@Farthington Whetmore

I definitely understood what you were trying to convey in your original post about securing tenants that fit the "theme" of your sim. I still however believe (and I think @TatianaDokuchic Varriale agreed) that satellite stores are not going to generate much in the way of new traffic (your goal) and for all the reasons I suggested above. That concept generally works for the sim owner because the rent from those shops helps to offset their cost of operations. The traffic generated from those satellite stores is in those cases just a bonus. Is it a good deal for the creator? Absolutely! Is it a fun and neat idea? Yes! But is it effective for long term traffic generation? Your idea isn't anything new, its been done before. A lot of RP sims have had stores that fit into a theme. The only difference I see based on the plan you suggested is to make it free.

Even if you were to get some creator's to put their mainstore there, you're still facing an uphill battle. A lot of people rarely ever explore areas outside of their destination store. This is a big change to how many residents used to shop years ago. I know I am always blown away when I discover that a favorite store of mine is literally down the block from another store I shop at.

I would also be weary about comparing a seasonal business model and how that would perform at any given time throughout the year. Your business is successful during those months because you're catering to an interest that is in demand during that timeframe so it becomes an attraction. Nothing in your plan gives me as a consumer and horror fanatic a reason to continue going back. So the question that many sim owners never answer is what do I do with that traffic I do get? Your plan should focus on creating community involvement.

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3 hours ago, TatianaDokuchic Varriale said:

Being a landlord is my least favourite activity.  Not only does it consume prims (you can always use more LI) but more importantly it takes time.  Good tenants are worth their weight in gold.  Bad tenants (don't follow your covenant, always exceed their prim limits, pick fights with other tenants, etc. etc.) are to be avoided at all costs because they're time consuming.

All of us in SL who sell anything, are selling our time. Not pixels, time. Any client or customer who demonstrates that he intends to consume far more of our time than he has paid for, is not a profitable customer. That doesn't mean you fire them for taking up so much time -- they might have redeeming qualities such as a cheerful disposition. But those who think they have paid for the right to insult and threaten endlessly will learn otherwise.

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Thank you for your replies. 

As professional working in Film and Television, time is something that I currently don't have a lot of .... but I usually take a few months off between gigs so in June when my show wraps I will be able to better focus on the community RP aspect. 

Dealing with unruly tenants is easily mitigated.

My plan is in its infancy but I feel there is a large enough Horror, Vampire, Gothic, Fantasy, Demonic, Satanic (etc) community to cater to  :)

Cheers! 

PS Additional market concept details and photos can be found here: https://thewhetmoregroup.wordpress.com/horror-village-market/

 

Edited by Farthington Whetmore
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Have you spoken about this with any likely creators themselves? It matters less what the majority of SL creators might or might not do and more what a few in your niche are happy to support in some way.

I would start by building up relationships amongst others who are involved in the genre and asking what they would like to see, what they might hope to gain or be able to contribute.

As for the idea of voluntary donation or free rent in exchange for providing ambience, decor and a bit of traffic, that's pretty much what I bring to a friend's sim. It works for both of us because it meets each of our needs in SL. My niche has a lot of ups and downs re sales so making regular rent can be a bit daunting. My store ranks well in a few key searches though, which brings in traffic to the rest of the sim.

It seems to me that the focus on mainstores and TPing to them overlooks things like the value of being able to advertise your sim/community in their groups and what any store, no matter the size, might be able to add in terms of getting your place seen via search. Likewise, an umbrella group for the stores in your sim could be a boon to those who are too small to maintain strong groups of their own. Themed shopping events are very popular today, which suggests that there is merit to bringing a collection of merchants together.

Just my thoughts. Good luck with your project.

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Why don't you organize horror-themed shopping events? SL doesn't have many of those... You can offer booths that would serve as satellite stores but shop owners would need to put out new release and all their customers would have to come to your sim in order to buy the item. You can even set the theme of the event and ask designers to create specific items, I was in one awesome event that had a new theme every month, last time the theme was shame and I made really cool item that would never ever come to my mind if it wasn't asked for. 

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1 hour ago, Tamara Artis said:

Why don't you organize horror-themed shopping events? SL doesn't have many of those... You can offer booths that would serve as satellite stores but shop owners would need to put out new release and all their customers would have to come to your sim in order to buy the item. You can even set the theme of the event and ask designers to create specific items, I was in one awesome event that had a new theme every month, last time the theme was shame and I made really cool item that would never ever come to my mind if it wasn't asked for. 

Now that's an original idea Tamara. Themed RP sims with storefronts has been done before. Events are still the fad and I haven't heard of any that is marketed direct to the horror community.

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