Avatar Business Value Analysis: A Method for the Evaluation of Business Value Creation in Virtual Commerce

Journal of Economic Commerce Research, 2008

14 Pages Posted: 17 Jun 2008

See all articles by Reina Y. Arakji

Reina Y. Arakji

City University of New York - Paul H. Chook Department of Information Systems & Statistics

Karl Reiner Lang

City University of New York - Paul H. Chook Department of Information Systems & Statistics

Abstract

The recent years have seen the emergence of a number of virtual worlds with various designs and purposes. Some have become very popular and have developed growing in-world economies. Real-world businesses are increasingly experimenting with doing virtual business there as well. In this paper, we present Avatar Business Value Analysis, a novel theoretical framework and a computational method and decision tool to help evaluate and strategically manage business value creation inside synthetic environments, and show how it can be applied to cost-benefit analysis in practical settings. The decision-tree-based method includes traffic metrics that may be used to empirically estimate the business value of virtual commerce ventures. We also investigate some intangible factors that are impacting these metrics in the context of the particular case of the virtual world Second Life and discuss their implications. We conclude by outlining strategies that could be considered by the operators of virtual worlds and the real corporations in order to promote sustainable virtual business in synthetic environments.

Keywords: Business Strategy, Business Value Creation, Online Marketing, Second Life, Traffic Metrics, Virtual Commerce, Virtual Worlds

JEL Classification: L21, L96, M31

Suggested Citation

Arakji, Reina Y. and Lang, Karl Reiner, Avatar Business Value Analysis: A Method for the Evaluation of Business Value Creation in Virtual Commerce. Journal of Economic Commerce Research, 2008. Available at SSRN: https://ssrn.com/abstract=1146769

Reina Y. Arakji (Contact Author)

City University of New York - Paul H. Chook Department of Information Systems & Statistics ( email )

17 Lexington Avenue
New York, NY 10010
United States

Karl Reiner Lang

City University of New York - Paul H. Chook Department of Information Systems & Statistics ( email )

17 Lexington Avenue
New York, NY 10010
United States
646-312-3370 (Phone)
646-312-3351 (Fax)

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