Greetings from Lounge Lizard!  The global economy has transformed itself in the last twenty years, expanding traditional business models into revenue engines that extend into increasingly virtual marketplaces.  From the earliest Internet businesses to tomorrow's mobile innovations, the primacy of idea has led to a revolution in commerce - and for some, an endless parade of profit opportunities.

In this issue of the Libation, we take a look at one of the fastest evolving sectors in modern digital marketing: the online trade in virtual goods.  Quickly growing beyond its gaming heritage, this marketplace is proffering serious advantages in business today.  Will your marketing program benefit from this exploding source of Internet-based sales?

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Value On Demand: What Virtual Goods Mean To Your Business
Last fall, Farmer's Insurance - founded in 1928 to provide low-cost auto insurance to the rural residents of California - announced a new "insurance" program aims at the newest generation of 21st century soil-tillers. This new program targeted players of the popular Facebook game "Farmville", and took the form of an app that, when downloaded, placed a digital Farmer's Insurance blimp in the air above the players' virtual farm. For the next ten days, the blimp's comforting presence would prevent the Farmville crops from withering.

The program was a big success. Over five million people downloaded the blimp. The Farmer's Facebook page exploded from a mere handful of fans to over 120,000 during the course of the promotion. And Farmer's Insurance won major brand promotion with little initial investment.

Virtual trade is big business today. According to marketing research firm In-Stat, over $7 billion was spent by users purchasing online wares in 2010 alone - a number that is expected to double by 2014. Real life millionaires have been minted through the buying and selling of virtualized real estate on the popular social network Second Life. From virtual furniture for virtual houses to marketing programs designed to boost brand awareness in social media, the trade of real money for imaginary goods is turning into powerful value for many companies.

Is your business ready to capitalize on this growing and evolving marketplace? The profit potential is high. The investment risk is small. Only creativity and initiative stand between your marketing goals and success in the virtual economy. Keep an eye on the following trends and be ready to grab your chance when it comes.

The rise of the decentralized experience. Real life is constructed from limits - space, resources, time - that tend to centralize markets into the hands of a few major players while commoditizing value. The virtual economy, on the other hand, goes in the other direction, towards expansion and limitless value, defined only by the skill and precision used to get across a new idea. Today's online consumer wants an individualized experience, and will pay well for it. As virtual experience increasingly moves towards more diverse, decentralized venues, look for the best spots for your business to establish a beachhead.

Value created in real time. Without the need to manufacture, store and transport physical goods, value creation in the virtual world happens at the speed of thought. Modern, sophisticated market research systems can generate actionable intelligence that can quickly be transformed into saleable value to virtual consumers. Keep an eye on the vital relationship between charting your consumer behavior and turning it into real time value - concentrating your marketing resources on this strategic edge will give you the crucial advantage.

The virtual revolution of modern search. While virtual commerce has been predominantly a tool of online gaming in past years, it will not always be so. As tested and successful virtual business models become extended more and more into other areas of modern life, look for online search to take on a form based more on how people manage information in real life. The major search engines are already busy researching and designing systems for more intuitive search modeled on objects and social relationships. Watch as the turbocharged market for virtual goods drives a revolution in how we seek out and find information online.

Augmented reality meets virtual marketplace. When many people read news stories about imaginary trophies bought and sold on the major gaming and social media networks, they see virtual commerce as an engine for fictional escapism. However, the demand for virtual value is beginning to overlap with one of the most exciting areas in mobile technology development: the genesis of augmented reality mobile apps. These new tools are exploring and redefining how we use mobile technology to increase and perfect our skills and abilities in real life. Soon virtual goods will join them - and far from being roads to escape, they will tie us more closely to real life than ever before.

The drive towards unified communications. As communication becomes ever more decentralized, the countless tools available today for connecting us with one another are also burying us in technology confusion. Fighting that trend, the push towards unified communications is becoming a major new telecommunications trend in the industry today. By finding new ways to intuitively integrate email, instant messaging, text messaging, web surfing and other forms of digital communication, new unified communications platforms will make virtualized value a crucial component in everyday life. Look for ways to simplify digital life while simultaneously empowering it. Your customers will reward you for it.

Unconstrained by the traditional business model limitations of manufacture cost, to-market times, inventory management and densely populated competitive arenas, the virtual marketplace is growing by leaps and bounds. Opportunities for revenue growth and brand development are limited only by imagination and creativity.

For marketers willing to chase bold initiatives and pursue customers where they live and play, the world of virtual commerce is one created of pure possibility and real life treasures.

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Market and Message
Savvy marketers everywhere are becoming increasingly aware of the supremacy of message and experience in the virtual world of online commerce. No longer merely a prelude to product sales, your sales message itself is the value - the real life experience - that your customers crave today. Are you doing enough to meet their ever more hungry demands?

At Lounge Lizard Worldwide, we combine the integrated expertise and creative wizardry necessary to build truly effective marketing programs today. Ask us how the industry's latest trends and technologies can turn into major opportunities for your business - and how strategic excellence can deliver real results for your focused investments.

Would you like more information about anything you've read in this newsletter? We would love to hear from you - give our offices a call at
1-631-581-1000 today.

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