Companies Look to Virtual Worlds for Eyeballs, Money

April 7, 2008 — -- Did you grow up watching Saturday morning cartoons on TV? Don't be surprised to learn that the online world may soon replace morning television in your kids' lives.

Children don't just watch; they interact, says Deborah Manchester, president of PBS's "Zula, USA."

"They'll look at a television show in a small portion of their screen," she explains, "and then in another portion, they're playing a game, or they're chatting with their friends. … That's what the Web offers that television doesn't."

Manchester spoke last week at the second annual Virtual Worlds Conference in New York, where dozens of companies met to explore ways to extend their brands from the real world to the virtual world, creating an online experience that will draw and keep kids' attention.

Companies such as Nickelodeon and Disney, ABC's parent company, are already in the virtual worlds business with kid-popular sites like Neopets and Club Penguin.

Mattel announced that its Barbie Girls virtual world is shifting to a paid subscription model. Since its launch a year ago, BarbieGirls.com has registered 11.2 million girls worldwide. Mattel's Chuck Scothon says when the new site launches in May, girls will still be able to access the free site, but the subscription site (no pricing announced as of yet) will offer updated game play, new content monthly and something Mattel calls the "Three E's; Educate, Empower and Engage."

Since virtual worlds are still sometimes a scary place for moms to let their children roam free, Mattel has designed a parent's place on the site, complete with user tools and content, focused on making sure moms and dads are comfortable. The company wants to make sure parents are in control of their daughter's online experience, Scothon says.

Virtual worlds like Barbie, Webkinz and Club Penguin are often where younger kids have their first online experiences, before they "graduate" onto older-oriented sites like MySpace.

Barbie Girls wants to be a place where families come together to set some Internet ground rules, Mattel's Scothon says.

"Let moms engage in conversation, agree on parameters, how much time, who can you talk to," Scothon says.

Make kids aware of what the rules are now, he says, so they can make good decisions later on.

One of the more interesting companies at the conference was the Metaverse Mod Squad. The company is using real people to staff real jobs in virtual worlds, kind of like a virtual-world temp agency.

At the show, the company demonstrated the service using the Web site for Gossip Girls.

Much like Second Life, Gossip Girls' visitors arrive as total newbies, says Peter Hilliard, co-founder of Metaverse ModSquad.

"The avatars greet them," as they would in a real world store such as Wal-mart, "show you around, teach them how to navigate the region, tell them how to change clothes, throw parties and dances for the participants in the environment," Hilliard says.

So can't a computerized avatar do that? Oh, no, Hilliard says; every avatar is a live person in the virtual world.

"It's a unique, intimate type of social interaction that occurs and if done through some type of a canned chat or a processed chat, we don't believe the user would get the experience that they're looking for in virtual world," he says.

So now I know where to go when I need to figure out how to buy virtual clothing.

But what about clothing ads? Greg Houston of a company called Slippcat wants you to be able to find your own advertisements in the virtual world.

Banner ads should be left behind, Houston says, adding that there should be nothing to interrupt your experience in the virtual world.

So how will companies advertise? Houston envisions a virtual world where avatars can "V-able," or virtually enable, any specific item.

Take a car you see in a virtual world, for example. In Houston's vision, users click on the item and get the make, model and selling price. If you want more information, you can be teleported to the virtual presence for the company to explore it further.

If you really want to know all about it, one more click sends an avatar representative of the company to come chat with you.

While the concept of virtual advertising is fascinating, will companies eventually be able to transfer back to our real world TVs? The thought has entered Houston's mind.

"The whole idea that you would be able to watch a television show without having to use Tivo to forward through the interruptions, but having those ads associated with the actual show … I think that's where we would like to be going," he says.

Andrea Smith is a technology producer at ABCNews Radio.