Understanding Purchasing Behavior within Virtual Worlds

Abstract

Although the hype around virtual worlds has slowed down in recent months, chances are high that this type of social media will increase in importance over years to come. Many companies which pioneered in entering virtual worlds have left these environments after their first steps. One of the reasons for these initial failures is likely the lack of understanding of in-world consumers and their expectations toward virtual commerce. The purpose of the authors’ chapter is therefore to investigate consumer purchase behavior within the virtual social world Second Life. Specifically, the authors analyze the types of purchase behavior consumers show within such an environment (planned purchases vs. impulse buying) and the factors that influence the decision to buy virtual products and services in exchange for real life money. For this, the authors’ study is based on a combination of a qualitative pre-study consisting of 29 in-depth interviews and a quantitative analysis based on responses obtained from a representative sample of 580 Second Life residents. The authors’ analysis results in the following three findings: First, the authors show that Second Life residents engage in two different types of purchase behavior: planned purchases and impulse buying. Second, the authors show that traditional consumer behavior theories and concepts can be transferred to similar behavior in a virtual world, although with different degrees of importance for different variables. And finally, the authors show that a Second Life resident’s usage intensity and consumption experience have a significant moderating influence on planned purchase behavior but not on impulse buying. From a managerial perspective, the authors’ results imply that Real Life companies that maintain Second Life flagship stores may consider communicating about their virtual products and services within real life. Additionally, Second Life stores should try to make the purchasing process as simple and convenient as possible (in order to increase planned purchases) and to create an overall exciting and pleasant shopping environment to elicit positive emotions among their potential customers (in order to maximize the probability of impulse buying). Finally, since purchasing behavior within Second Life appears to be more individualistic than what can be observed in real life, firms can consider offering virtual products and services in Second Life that are highly extravagant and may never be purchased in Real Life due to fear of other people’s opinions-–which is likely to be of particular importance for fashion goods.