I D E N T I F Y I N G P S Y C H O L O G I C A L T H E O R I E S T O U N C O V E R

T H E S U C C E S S O F M I C R O T R A N S A C T I O N S W I T H I N T H E

D E V E L O P M E N T O F O N L I N E V I D E O G A M E S

INTRODUCTION

CHAPTER 1: DEFINING VIRTUAL GOODS

CHAPTER 2: ATTRIBUTES OF TRADITIONAL CONSUMERISM

CHAPTER 3: ATTRIBUTES OF CONSUMERISM EXCLUSIVE TO THE VIRTUAL WORLD

CHAPTER 4: CONCLUSION

GLOSSARY

BIBLIOGRAPHY

i. Hierarchy of Needs

ii. Social, Functional and Hedonic Attributes

iii. Social Influence

iv. Impatience

v. Majority Influence

vi. Envy

i. Advertising

ii. Punishment and Reward

iii. Observation

iv. Self Projection

v. Conformity

vi. Desensitisation and Deindividuation

vii. Immersion

i. The Present

ii. The Future

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Last year marked the 40th anniversary of commercial video games, which

began with Nolan Bushnell’s coin-operated ‘Computer Space Arcade’

game in 1971 (Wolf, 2001, p. 1). Since then, video games have progressed

into a form of entertainment where money is directed not to the game play

itself, but to the content within it. People young and old are exchanging money

for ‘virtual’ commodities, such as hats and weapons, and the trend is growing

ever popular. This might seem bizarre to those only willing to hand over hard-

earned cash for physical items, but perhaps there are underlying reasons for

purchasing virtual items which are similar to those for buying real items. If not,

what is it that makes virtual consumerism so different and so successful?

The primary aim of this essay is to explore the reasons for virtual

consumerism, in particular within the online gaming community. It will outline

various theories concerning comparisons to real life consumerism and theories

which are specific to consumerism in the virtual world, with intent to uncover

why players may, or may not, be inclined to purchase virtual goods.

Research for this paper will come form a variety of sources including

current research on the trend of microtransactions[7] and free-to-play gaming,

research on the effects of video games, psychological theories and exploration

of traditional consumerism. It will also use primary sources such as forum

threads where questions have been directed at existing gamers, and surveys

(see appendix) based on two specific online games, Team Fortress 2 (2007) and

Habbo (2000). These case studies will be used to support evidence throughout

the essay and have been chosen due to the popularity of their microtransactions

system, as well as allowing a comparison between age, gender and subject

matter.

Males of varying ages predominantly play Team Fortress 2. The game

offers a mixture of virtual goods, from weapons to cosmetic items such as hats,

providing an interesting foundation for discussion due to its diverse variety of

virtual commodities. The purchasing of weapons within this game implies a

desire to better game play, yet the more aesthetic items suggest otherwise.

Habbo is aimed at young teenagers, both male and female, and is centred

around attaining items for avatars[3] and furniture for rooms. This likeness to

traditional consumerism makes for an interesting comparison and suggests that

perhaps the virtual world is no different to the real world.

1

2

Team Fortress 2, Valve Corporation (2007)

When considering virtual commodities it is difficult to define what

they actually are and how they differ from ‘real’ items. Perhaps it is

something one can see but not touch, something one can hear but not smell.

‘Real’ items generally engage all the senses, or at least have the potential to

do so. However, with the advance of technology, the line between the two is

blurring. ‘Soar’, a popular ride in Disney World Florida, allows you to fly over

an orange field, hear and feel the wind, see and smell the oranges, but it is not

real. Downloadable music, on the other hand, engages only the hearing sense

yet it feels very real. What appeals to the consumer is the experiential value of

the item- how it makes them feel and the way that it changes their life. (Zepf,

2010, p. 145) noted that “commodities are no longer offered solely as means of

meeting certain material requirements; they are now advertised to satisfy needs

that are independent of their material usability.”

In regards to this essay, virtual items will be considered as “simulations

of material objects” (Lehdonvirta, 2011, p. 2) found in online games. This will

make the comparison to real life consumerism more effective and will allow for

better application of theories. These will be such items as weapons, clothing for

avatars and decorative items for the virtual world. The primary games which will

be used to illustrate these theories will be Team Fortress 2 and Habbo.

Team Fortress 2, or TF2, is a team-based first-person shooter[5] multiplayer

video game developed by Valve Corporation[14]. It involves selecting one

of nine characters or ‘classes’ and joining one of two teams (red or blue). An

environment or ‘map’ is then selected, and the aim is to succeed the opposite

team by defending personal territory and attacking the other team’s. Players

compete online with up to 31 other real gamers across the globe, or can set

up a server to play with a select number of people. The art style of the game

is very cartoon-like, yet remains particularly masculine: “In Team Fortress

2, we chose to employ an art style inspired by the early to mid 20th century

commercial illustrators J. C. Leyendecker, Dean Cornwell and Norman

Rockwel” (Schau, 1974, cited in Valve Software, 2007).

When the game was first released in 2007 it had to be purchased, but

nothing within the game had to be paid for. Weapons were available as a

means of bettering game play but could only be attained by progression and

completing achievements[1]. In May 2009, Valve made Team Fortress 2 ‘free-to-

play’. After this point, the number of people playing the game rose dramatically,

D E F I N I N G V I R T U A L G O O D S

“Commodities are no

longer offered soley

as means of meeting

certain material

usability”

“The art style of

the game is very

cartoon-like, yet

remains particularly

masculine”

3

overtaking the most popular game on Steam[9] (an online platform used to

distribute games), ‘Counter-Strike’: “Overnight, TF2 has leapt from a top ten

position to the very top, gaining tens of thousands of players in the process.”

(Senior, 2011). Since the game became free to play, weapons can now be found

(as a result of random item drops) or bought from the in-game shop. Items

include ‘Weapons’ such as guns, knives and comedy articles such as gold clubs.

‘Tools’ such as varied paint colours to make existing items more unique can also

be bought. ‘Hats’ come in a variety of styles and are generally the most sought

after items. They are generally seasonally or culturally themed, but are usually

exaggerated. Finally ‘Misc’ items include glasses, facial hair and even gestures

or ‘taunts’ such as hi5-ing other teammates. Prices range from 29p for a baseball

bat, to £14.99 for a “pile ‘o’ gifts”. Items are purchased by ‘adding funds’ to an

account, with a minimum of £4 and maximum of £100. This is never converted

into a form of virtual currency, so the cost of items is always explicit.

Habbo (formerly ‘Habbo Hotel’) is a social networking site developed by Sulake

Corporation[10] in 2000, enclosed within a virtual hotel which allows users

to purchase furniture, clothing and a variety of accessories to enhance their

personal room or avatar. Since it began, the service has expanded to 11 hotels,

attracting players from over 150 countries worldwide. The site is predominantly

aimed at teenagers and currently has 230 million players registered worldwide.

It is free to sign up and users can walk around the hotel, visit rooms and interact

with other players without obligation to spend. The aim of the site, as quoted by

the company itself, is to “make friends, chillax, get noticed!” (Habbo, 2000).

Items chiefly involve decorations and furniture for rooms, such as wallpaper

and seating, but other items such as pets, music for rooms and even effects

(such as releasing bubbles) can also be bought for furniture. Items can be

bought using ‘credits’[4], a virtual currency which is purchased with real money.

Credits are bought in batches, from 40 credits for £5 to 490 credits for £50. This

alternative method to the Team Fortress 2 economy means that Habbo users

are generally unaware how much each individual item is costing them in real

money. Prices range from a rubber duck for 1 credit (equivalent to 10p) to a

Tree Frog pet for 30 credits (equivalent to £3).

“Overnight, TF2 has

leapt from a top

ten position to the

very top, gaining

tens of thousands

of players in the

process”

4

5

Habbo, Sulake Corporation (2000)

When considering why gamers purchase virtual items, it is logical to first

explore the reasons for purchasing traditional goods. There are copious

amounts of research on traditional consumerism, which can also be used to

explain virtual consumerism and suggest reasoning that may be rooted in

evolutionary psychological theories.

The founder of humanistic psychology, Abraham Maslow (1943, cited

in Trigg, 2010, pp. 393-405), developed a system called the Hierarchy

of Needs to suggest what consumers spend their money on and how that

decision is made. He proposed five levels, beginning with a base level of

lower basic human needs such as food and water, up to security of health

and family, love and friendship, then confidence and self-esteem. At the top

of the pyramid is self-actualizing or ‘moral needs’, and “such higher needs

can only be attainable once more materialistic basic needs are achieved”

(Trigg, 2010, p. 395). Most will strive to ascend the hierarchy as high as

possible and will get there by any means possible. Individuals tend to

move with their increasing incomes, and although many of these levels can

be achieved without money, “Money Can’t Buy Me Love,” (Lennon and

McCartney, 1964), it is often money which aids development.

It is often the same in the context of video games. Although the lowest

level, survival needs such as food and water, can only be satisfied in the

real world, the remaining levels can be attained just as easily, if not more

easily, in the virtual world. Although video games are not policed in such

a way that the real world is, there are strict rules enforced regarding game

play and language. This satisfies the safety needs, as well as protection in the

form of anonymity. Safety cannot necessarily be purchased in the virtual world,

but games do typically provide such services, and once a payer feels that this

level is satisfied the likelihood of them moving onto higher needs levels will

A T T R I B U T E S O F T R A D I T I O N A L C O N S U M E R I S M

“ Most will strive

to ascend the

hierarchy as high as

possible and will get

there by any means

possible”

7

increase. The next level, belongingness and loves, is where virtual consumerism

often begins. Video games provide players with a mass of like-minded people

and infinite ways to fulfil personal potential. Although these can be achieved

with time and effort, it can be attained much quicker with money. This may

explain why those entering the virtual hierarchy of needs for the first time will

contemplate purchasing virtual items, as a means of rapidly working their way

up the pyramid.

It may also support the idea of justification; Players may have gravitated

towards video games because they have failed to climb the pyramid of needs

in real life, and as they have not purchased traditional items to help them in

that context, they can justify purchasing them in this fresh, virtual world. Virtual

consumerism may also be justified due to the knowledge that players are

making some form of real-world progress; purchasing items which in the real

world have a relatively higher value. Despite the fact that they would perhaps

never profit from purchasing and selling a real item, having something which is

craved by players offering real money may be enough of an incentive.

An alternative suggestion to justification is the theory that they can never

truly accomplish the highest level of Maslow’s hierarchy of needs, self-

actualisation: “A healthy personality, while including success in appropriate

coping behaviour involving mastery, effectance and competence, must

also include a point where the individual is freed from the influence of their

environment” (Venter, 2010, p. 30). Maslow identified the main source of

inhibition for personal growth as culture.

Although cultures are very strong in real life, they can still be escaped from,

and other cultures can be absorbed. In the virtual world they are even stronger,

and ‘Team Fortress 2’ or ‘Habbo’ almost becomes a culture in itself. Liew (2009)

suggests that “they belong to a global community that defines itself not so

much by race, religion or region, but by the definition of what it is to be human.”

Perhaps then it can be argued that gamers do not know how to consume in the

real world, but in the virtual world it is much clearer what they are required to

purchase in order to satisfy the hierarchy of needs.

One somewhat obvious speculation in relation to Maslow’s Hierarchy of

Needs is simply that those with a higher income are more inclined to purchase

virtual commodities. If virtual items are to be placed in the higher levels of his

pyramid, friendship and self esteem, then perhaps this suggests that the player

has enough money to satisfy the basic human needs and has an excess which

allows them to comfortably purchase more ‘luxurious’ items. This may not be

the case, however, as 93% of Habbo users surveyed were under the age of 21

(thus, most likely not earning), yet 86% of all surveyed said they had purchased

virtual items within the site (see appendix). This implies that there is no

correlation between income and the likelihood of purchasing virtual items.

Alternatively, there may be a link between a player’s income and what type

of virtual items they purchase. For example, in the case of Team Fortress 2,

a player with less money may be more astute with their spending and may

purchase only items that help them progress in some way. These items, such as

weapons and armour, would in the context of the game be seen as necessary.

“Video games

provide players

with a mass of

like-minded people

and infinite ways

to fulfil personal

potential.”

“86% of all

surveyed said

they had purchased

virtual items within

the site”

8

Those with a higher income, however, may be satisfied that they have all the

necessary items they require (or, feel that they are above purchasing necessary

items) and so may purchase items in regard to taste. This could include

cosmetic items such as hats in TF2 or special effects in Habbo.

In games such as Habbo, there is evidence that its creators are aware of

this taste versus necessity concept. For those wanting to play the game for

free, necessary items are available to purchase with virtual coins earned for

spending time on the site. This means that players can be part of the experience

and gives them a reason to keep coming back. There is a social price to pay,

however, as this ‘free’ furniture is labelled as “happy furniture” and it is rather

clear to other players who has not paid for their items. Those who are truly

interested in playing the game, that is socialising, making friends and gaining

popularity, know that they will achieve more if they begin with more. In relation

to Maslow’s Hierarchy of needs, this could suggest that the more money spent

on purchasing items that satisfy the basic human needs level, the easier it is

to get to the social level of love and friendship. Evidence to support this idea

comes from the Habbo questionnaire (see appendix), where users were asked

what the virtual items in the game were about for them. 37% said that they

helped them to make friends, whereas not one participant stated this as a reason

in the Team Fortress 2 questionnaire. In a socially centred game such as Habbo,

making friends is essential, thus purchasing items to aid such a process may be

deemed as ‘necessary’.

This selection of luxury basic needs could, therefore, simply be down to

taste. In real life the consumer might pay more for a ‘luxury’ chicken sandwich-

not because they want to appear superior but because they know that they are

paying for higher quality, more expensive ingredients and better taste. However,

with virtual items consumers are not paying for labour or materials that can

be valued; if a virtual item is labelled as “VIP”[12] they are simply paying for

the illusion of being VIP; advertising in its purest form. If it is simply an idea

which encourages virtual consumerism, there must be psychological theories

suggesting why consumers strive to climb the hierarchy of needs.

“37% of users said

that virtual items

helped them to

make friends”

“This selection of

luxury basic needs

could simply be

down to taste”

9

Many studies on the psychology of consumerism have revealed different

motives for why humans to want to spend. However, three labels that are

frequently identified are Functional, Hedonic and Social.

The first, ‘functional’, is about progression; excelling over others so that one

can in some way have victory over them. This theory is especially evident in

the context of a racing game, or similar high-level competition. For instance,

Liew (2009) proposed “I might buy special tyres for my car so that I can corner

better, so I might buy virtual tyres for my virtual car so that I can corner better.”

Technology is advancing to provide us with faster, stronger, better, so that we

will never label something superlative. The same can be said for many virtual

items in competitive video games, and explains why new goods are continually

added to the current goods on offer. Not only does it allow variety and maintain

interest in players, but it ensures that should they purchases the ‘best’ item,

others can at some point beat it and thus will continue to buy items with

optimism.

Team Fortress 2, and recently Habbo, both show evidence of functional

consumerism. When TF2 was first released, weapons were only attainable

by completing achievements within the game. Although they were not

purchasable, players still wanted the weapons as a means of progressing in

the game and triumphing over other players. Here time was the currency, and

due to the busy nature of today’s generation, time is something almost more

scarce and valuable than money. It was only when the ‘Item Drop System’[6]

was implemented in May 2009 that weapons were available to find, and more

importantly, to purchase. This meant that those unable or unwilling to invest

large amounts of time in attaining the items were able to exchange them

instantaneously for cash. Although this generated an outcry from the gaming

community, whose views were exchanged within forums dedicated to Valve

games, it does reflect almost identically the workings of real life consumerism.

In Habbo, the process of purchasing items, and thus having more items than

others, could count as progressing in the game. In addition, ‘effects’, ‘triggers’

for effects and even ‘conditions’ for triggers can now be placed on mundane

objects. For example, a piece of furniture may reveal a secret message if a

user enters the room if the piece of furniture has another piece of furniture on

top. This creates sought after functions that would make one person’s object

superlative to another’s. Effects, however, can only be rented, and usually for

one hour maximum. This means that even the most deluxe items in the entire

hotel will have to be purchased repeatedly in order to sustain Godly status. This

eliminates the possibility of completion within the game and keeps the players

coming back.

“Even the most

deluxe items

will have to

be purchased

repeatedly in order

to sustain Goldy

status”

“I might buy special

tyres for my car so

that I can corner

better, so I might

buy virtual tyres

for my virtual car

so that I can corner

better”

10

“Games developers

often purposely

throw players into

a sea of identical

looking characters”

The second label is Hedonic; relating to establishing identity and presenting

personality in an otherwise monotonous world. The clothes they wear, the car

they drive, and even the music they listen to, all contribute to how the consumer

might define themselves and how they want others to perceive them. Items are

purchased in order to fit in with social statuses (or often, exceed them), and

which give others a strong sense of character prior to engaging in conversation.

This is particularly true for the virtual world, where games developers often

purposely throw players into a sea of identical looking characters to make

them want to stand out. For which usually, there is a price to pay. In Habbo

avatars can be customised to a degree, but if a user wants something ‘out of the

ordinary’ they must purchase additional items. And it doesn’t stop at clothing-

pets, badges and even effects (such as flies buzzing around a user’s head) can

all be purchased to add to the uniqueness of an avatar. And of course, it works

in reverse. If players want to be part of the crowd, fit in within a world different

to the one they live in, they can dress just like everybody else. Just like shop

mannequins who display what customers should be wearing and with what

combination, Habbo is designed appeal to the hedonistic consumer wanting to

follow trends to fit in.

Team Fortress 2 isn’t too dissimilar. Here a selection of nine characters or

‘classes’ are offered but once selected, a player will look identical to everybody

else playing as that character. Since the introduction of the shop and the Item

Drop System, the items that everybody craves are hats. There are numerous

designs, some with effects, but a large part of playing TF2 is seeing what hats

other players own and which ones can be found. It is interesting that in a game

which is all about skill and competition, the cosmetic items are sought after

more than those in the social chat room of Habbo. An alternative example

of this aesthetical purchasing is evident in the opportunity to dress up the

avatars used to represent gamers on their Xbox[13] profiles. There are no

obvious advantages to doing this, no achievements and no game progression.

Yet many players chose to buy extra items to make their avatar look unique,

or more like their real characteristics. This could only truly be explained by

the hedonic theory. The player who purchases items to alter their avatar may

be trying to establish their identity, to let others know what they are like as a

person, not just as a gamer. They may also take comfort in the knowledge that

it is not a computer-generated character that is attaining all the achievement

within games, it is themselves. When asked what the virtual items in each game

were about for them, over half of the gamers answering both the Habbo and

the Team Fortress 2 questionnaires stated that ‘making their character look

unique’ was of most importance (see appendix). This response has little to do

with game play or progression, suggesting that ‘looking good’ is as important

in the virtual world as in the real world. However, looking good may not be

simply a case of wanting to express identities, but may have underlying social

interpretations such as wanting to fit in with others who look good.

“When asked what

the virtual items

in each game were

about for them,

over half of gamers

stated that making

their character look

unique was of most

importance”

11

Formed relationships or associations with others, whether good or bad, can

be used to explain both real and virtual consumerism. A human behaviour

that affects both real and virtual consumerism is social influence. Often

consumers give way to pressures in order to ‘fit in’ with a specific crowd, and

sometimes they do it because they are not sure of the correct way to act and so

look to others to guide them. Each social group has its well-established norms

that indicate how members should act; this creates pressure for others to

maintain such behaviour, and conformity arises (Cardwell & Flanagan, 2004,

p. 164). This conformity is especially prevalent within the world of video

games, and mainly occurs in newcomers to the game. New players strive to

win, they aim to be as skilled as those who have played for a lengthy amount

of time and who, generally, have earned their items through achievement

and have committed a great deal of time. These new players know that in

order to fit in with the higher players they need to level with them, and the

easiest way to do that is to purchase items.

In Team Fortress 2, it is almost impossible to know which players have

spent time on attaining their items and who has purchased them. Therefore,

it is much easier to gain respect from older players simply by purchasing

items. This provides an incentive for players, especially new players, to fast

track from ‘noob’[8] to ‘skilled’.

The third label is Social; Building, maintaining, and occasionally evading

relationships. Linked to the Hedonic theory, traditional items can be purchased

to make the consumer appear unique; often to attract a mate or to display a

side of their personality that they think might be attractive to a certain group

of people. Humans are not born with the iridescent plumage of a peacock or

the colour-changing abilities of the cuttlefish, and so they exchange money for

replacement items which will perform the same task. Usually these are cosmetic

items, such as items of clothing or makeup. In Habbo, almost all the items act

as social incentives.

In Team Fortress 2, there is less evidence of players purchasing items to

attract other players - perhaps due to the competitive rather than social nature

of the game. When asked which statement they agreed with (see appendix),

more TF2 players stated that they buy clothes in real life which make them look

unique (23%), than those who said they purchase clothes to fit in with social

trends (14%). This reflects the habits of players within this game who strive for

the more ‘original’ items rather than the most popular.

The opposite was true for surveyed Habbo users, where more bought

clothes to fit in with social trends (33%) as opposed to wanting to appear unique

(24%). In this game, players do strive for the most popular items, even if they

are the most expensive.

“These new players

know that in order

to fit in with the

highter players

they need to level

with them, and the

easiest way to do

that is to pruchase

items.”

12

“More TF2 players

stated that they buy

clothes in real life

which make them

look uniue, than

those who said they

purchase clothes

to fit in with social

trends”

11

In relation to social influence, impatience may be a theory which suggests

why consumers purchase both real and virtual items. There are frequently

sales within stores in real life, yet there will always be those who pay full price

for items simply because they cannot wait for prices to descend. Those who are

shrewder with their money know that if they wait longer they can search for a

cheaper price or simply wait for the item to be reduced. It is often the same for

virtual consumerism, particularly in skill-based games such as Team Fortress

2. It is perfectly viable to attain a large amount of items through game play

alone, without having to spend any money - the only issue is that dedication of

time and development of necessary skills are required. Many players are happy

to do this, but those who just want a ‘quick fix’ and avoid the time-consuming

methods will ‘buy-it-now’. This lack of patience is also evident in games such as

‘Tiger Woods PGA Tour 11’ (EA Tiburon, 2010) and often other sports themed

games. Some gamers enjoy the challenge of unlocking items as they progress,

but for others this stage may be considered tedious and want immediate access

to all areas of the game. Ermi & Mayra (2005, p. 3) argue that “playing games

does not always feel fun: on the contrary, it quite often appears to be stressful

and frustrating.” For these types of people it has been made even simpler, as

purchasable cards are available in high street stores enabling them to simply

type in a code and have all levels and weapons unlocked. These types of games

are often single-player, implying other players would be unaware that any items

had been attained or levels unlocked. If social and hedonic needs do not apply

here, perhaps it is simply the human, functional need to complete something.

“Playing games does

not always feel fun;

On the contrary, it

quite often appears

stressful and

frustrating”

14

“We must see group

phenomena as both

the product and

condition of actions

of individuals”

“People idealize

when they

are envious”

The amount of majority influence in a game can be used to measure the

level of immersion players feel that a game has. For example, many people

would enter Habbo thinking it would be absurd to purchase unreal items or

to pay extra to clothe their avatar. However, because the amount of players

purchasing these items snowballed into a majority, it is generally accepted

that virtual consumerism is normal, perhaps even ‘good’. Asch (1952, cited

in Solomon Asch Center, 2012) stated that “we must see group phenomena

as both the product and condition of actions of individuals,” suggesting that

even if a player is following the trend of virtual consumerism, they have made

the conscious decision to do so. If it is ‘normal’ to purchase virtual items,

then perhaps these items become real. Molesworth & Denegri-knott (2005,

p. 4) suggest that “both contemporary consumption practice and now also

behaviours in digital space may allow for actualization of the imagination.” It is

no longer a case of ‘purchasing a virtual chair for my virtual room’, but simply

‘purchasing a chair for my room’. The line between reality and ‘virtuality’ fades

with the majority’s perspectives.

Upon entering Habbo a user is be greeted by thousands of people. Around

80% of those people will be wearing “VIP” clothes that they have paid

for. Not only are there the people whose innate desires want them to buy these

virtual items, not only are there the people who buckle from pressure to buy

these items in order to fit in, but there are the people who experience envy

for others’ possessions. They do not necessarily want to be better than those

people, they just do not want to be the ones without. Marano (1994), a specialist

in Social Psychology, states that “envy occurs when a person lacks another

person’s superior quality, achievement, or possession, and desires it.” Perhaps

envy is a result of the mechanisms of advertising- consumers are shown how

their life can improve, how they can be the best person they can. But perhaps

they cannot afford to purchase the necessary items: “People idealize when they

are envious. You can imagine that a quality or something possessed by someone

else would bring you happiness or fulfilment” (Lamia, 2011).

15

“An envious person

just assumes that

the other person is

happier or better”

When walking around a virtual world such as Habbo, many other players

may appear to posses the very items that can make for a better life. They envy

them because they think that their lives have been made better. As Lamia (2011)

describes, “we really can’t know what another person’s life is like, but an envious

person just assumes that the other person is happier or better. So in a strange

way, when you envy someone else, you are giving them a compliment.” This

process increases the potential for selling virtual items in two ways: Those who

are without often cannot fight off their envious desires and purchase the items

that they feel with remove such feelings, and those who are envied are able

to justify their consumption further and will continue to consume in order to

receive further compliments.

16

Many theories have been identified as to the psychological motives for

people purchasing both real and virtual items, but perhaps the virtual

world provides a platform for alternative theories. This chapter will explore

how virtual consumerism differs from traditional consumerism, and how the

mechanisms of online video games affect the spending behaviours of gamers.

Almost all commodities created for sale have adverts in some form, whether

posters, magazine adverts or television commercials. They are essential

in informing the public about what they have offer and why they should chose

their brand; “It therefore seems reasonable to assume that the decision to buy a

product as well as the connection of the buyer to the product is brought about

through the connection of commercials with those unconscious scenes” (Zepf,

2010, p. 146). The consumer identifies with the people and lifestyles within

the commercial; they project themselves into the products and see them as an

extension of their own personality. They are seduced by the illusion, whether

truth or not.

However, the majority of games, especially online games, do not advertise

themselves. This could be due to the simple fact that people love to talk about

video games. There are countless professional video games journalists, both in

magazines and on online blogs, and many more who like think of themselves

as such. Games companies do not need to hire an actor to tell people why they

should buy their game- there is an abundant of players who genuinely believe

it, and want to let others know about it. The forum post created to advertise

the Team Fortress 2 questionnaire for this essay generated over 1000 views

and 57 replies in less than a week. People just wanted to talk about the game,

about virtual consumerism and about how it made them feel. Companies such

as Valve know that if gamers are truly passionate about video games, they will

seek out the ones that appeal to them. Whether that be online blogs, gaming

A T T R I B U T E S O F C O N S U M E R I S M E X C L U S I V E T O T H E V I R T U A L W O R L D

“People just wanted

to talk about the

game, about virtual

consumerism and

about how it made

them feel”

17

magazines or word of mouth, news about up and coming games quickly

spreads. According to the Virtual Consumerism questionnaire (see appendix),

over 50% of the surveyed Habbo users began playing the game because it was

recommended by a friend, suggesting perhaps that it is the portrayal of game

play by others which persuades first time players into a game and which gives

them the impression that it is a permissible game to purchase virtual items for.

Only 4% stated that they began playing because they liked the items on offer

within the game. Perhaps this is because the availability of virtual items within

games is never directly advertised; it is the portrayal of game play which allures

potential players and only once they are in will they discover the benefits of

purchasing additional items.

On the other hand, some of the more popular games such as Call of Duty:

Modern Warfare 3 (Infinity Ward and Sledgehammer Games, 2011) and Halo:

Reach (Bungie, 2010) do often promote themselves on television adverts, in

bus shelters and on the back of magazines. The cinematic scenes and powerful

language attract players who want something ‘cool’, something that appears

to provide them with the credibility they crave. These adverts often appeal to

‘weekend gamers’- a term given to those who only play a select number of

games and who play fairly infrequently. They are less likely to be interested in

personally seeking out information about new games, so in an attempt to attract

a wider audience, games companies often release adverts in a medium that is

viewed by the vast majority, gamers or non-gamers.

It could be argued, however, that there are issues other than external

advertising or word of mouth which elicit virtual consumerism. It may explain

why gamers first decide to join a game, but perhaps not why they chose to

spend money within it.

Although many of the theories which relate to real-life consumerism also

relate to virtual consumerism, there are psychological theories which are

especially evident in the context of video games. The behavioural perspective

proposed by B.F. Skinner suggests that certain human behaviours are the result

of a punishment and reward system which we receive from the environment:

“Skinner demonstrates that most organisms will perform repetitive behaviours

for very little randomly distributed reinforcement” (Wolf, 2001, p.173). Skinner

uses the example of taking part in the lottery, despite having very little chance

of winning and despite the financial loss we suffer in the process. When

in the environment of a video game, the desire to win is heightened. The

consequences of purchasing virtual items, such as reaching higher levels or

“Only 4% of Habbo

users began playing

the game because

they liked the items

on offer”

“The cinematic

scenes and powerful

language attract

players who want

something cool”

“Most organisms will

perform repetitive

behaviours for very

little randomly

distributed

reinforcement”

18

engaging in more social interaction, may act as reinforcement for purchasing the

items themselves. Due to the immersive nature of the video game environment,

the loss experienced during such behaviour, in this case the loss of money, is

often overlooked. If there are no negative consequences for purchasing items

in the virtual world, then reinforcement is strengthened and the pattern will

continue until a connection is made with the real world.

Where Skinner suggested that learning takes place through reinforcement,

Albert Bandura (1962, cited in Cardwell & Flanagan, 2004, pp. 34-36)

argued that we learn from observing others and imitating their behaviour, a

process he labelled the ‘social learning theory’. Traditionally the experiments

were performed on children, and the way that they behaved with a blow-up doll

depended on the observed behaviour of others with the doll. Due to the naivety

of children in such a situation, this may explain why children, or at least younger

players, are more likely to purchase virtual items. In real life they may see others

consuming, but unless they are of a similar age to them they may disregard

any resemblance to themselves and thus may not be inclined to imitate the

purchasing of items. In a video game however, it is almost impossible to

determine the age of a player; everybody looks similar to the player in question

and everybody is a role model. The social learning theory suggests that the

consequences of human behaviour determine the likelihood of repeating that

behaviour. So, if a player purchases a weapon which attracts attention, allows

them to make friends and helps them progress in the game, they are very

likely to go back and purchase more virtual items. Similarly, the work of Pierre

Bourdieu (1993, cited in Trigg, 2010, pp. 398-399) suggests an alternative social

hierarchy to Maslow’s where primary status is placed on the importance of

relationships for individual development: “Consumers watch and copy because

in doing so they learn how to spend their increased purchasing power.” It is

almost impossible for a player to determine the income of other players and

how they compare to them, so perhaps blind imitation is the main aspect of

spending habits.

“Consumers watch

and copy because

in doing so they

learn how to spend

their increased

purchasing power”

19

Based on the work of Freud and Jung, the Psychoanalysis approach

underlines the conflict between the pleasure-seeking subconscious and the

more conservative conscious minds. Carl Jung proposed that all humans share a

basic understanding of the world, which is depicted through signs and symbols

within our dreams, art and analogies. “These archetypes are translated into

standard symbols that tell the collective story of our human experience and our

search for meaning” (Wolf, 2001, pp. 174-175). This explains why video games

are so popular and immersive; they connect with the same primitive symbols

and provide players with a place to live out their aspirations and achieve a

sense of progress. The interactive medium of video games means that players

cannot only idolise a celebrity or fictitious character, but they can become

them. Much of advertising relies on selling an idea - if you wear this clothing,

you will be like professional American skateboarder Tony Hawk. However, with

video games you can go one step further; you can be Tony Hawk, and purchase

virtual clothes for your new, superior self. Players are temporarily transported to

another reality, one where there are few boundaries and if Tony Hawk can have

it, so can they. Perhaps then, the video game increases the need to succeed. In a

world where there is success, failure and not much between, the desire to spend

in order to progress is heightened.

An interesting observation by Social Psychologist Asch (1956, cited in

Cardwell & Flanangan, 2005, p. 166) suggests that those who are low of

self-esteem are more likely to conform, as they are most likely to fear rejection.

Although a very sweeping statement, many games players, especially those in

virtual chat rooms such as Habbo, are low of self-esteem and so chose to hide

behind avatars and false identities. This could suggest why the virtual economy

is so powerful; its consumers are more likely to be those looking for a quick fix

than a long-term investment. This may not be the case, however, for skill-based

games such as Team Fortress 2. Here social interaction is not a key issue, so

one would not expect a large amount of players to be concerned with being

‘liked’, although seeking acceptance is equally as common within conformity. It

could be suggested that females are more likely to be conformist than males as

they are more concerned with social relationships, and therefore are more likely

to consume virtual items.

“The interactive

medium of video

games means that

players cannot only

idolise a celebrity or

ficticious character,

but they can

become them”

“Those low of self-

esteem are more

likely to conform, as

they are most likely

to fear rejection”

20

21

The reasons for video games attracting virtual consumerism may be due

to the nature of the virtual world. In most video games, especially first

person shooters such as Team Fortress 2, violence is left unpunished and is

therefore justified. This clashes with the consequences of real life violence

where punishments, whether big or small, are always enforced. The lack of

guilt or concern about violence is reduced, and in this unreal state it seems

reasonable to suggest that their inhibitions to spend money on virtual items

would also be lessened. Desensitisation to violence may, therefore, lead to

desensitisation of finances within a world which has no boundaries. On a similar

level, desensitisation could also be applied to money. As stated earlier, a large

percentage of most video games players are in their teens or young adults,

thus are they are less likely to be earning an income and taking responsibility

for their expenses. Perhaps the purchasing of virtual items is so popular simply

because its target audience are not paying for them with their own money.

Habbo, in particular, used to be a game where users could only purchase virtual

credits with either a credit card or cheque. Very few young players had access

to these, especially not to their own, so had to ask an adult to send off the

money for them. Just like the Social Learning Theory, children quickly learn

that purchasing virtual items within a game has no negative effect on them,

and so will not hesitate to continue purchasing. Recently, however, games such

as Habbo have provided several more methods for payment. Most popular is

the use of mobile phones where a certain amount of credit is deducted, and

prepaid game cards that can be exchanged for cash in numerous high street

stores. This eliminates the need for adults or parents to input in the payment

process, and although it means children are more aware of their own finances, it

often leads to unsupervised overspending. ‘Smurfs’ Village’ (Beeline Interactive,

Inc., 2010), an online game developed for the iPhone, makes it particularly

easy for children to purchase ‘smurfberries’ - the in game currency - for real

money: “Last December, a four-year-old in New York bought about $70 worth

of smurfberries without really understanding the consequences of pushing the

‘Buy’ button in-game” (Oxford, 2011).

Similar to desensitisation is deindividuation, a psychological state of

decreased self-evaluation often used to explain antinormative behaviour online

and in computer-mediated communications. Just like a football supporter within

a crowd of other brazen supporters, gamers may get lost amongst the crowd

and forget their morals, beliefs and identity.

“Children quickly

learn that

purchasing virtual

items within a game

has no negative

effect on them,

and so will not

hesitate to continue

purchasing”

“Last December, a

four-year-old in

New York bought

about $70 worth

of smurfberries

without really

understanding the

consequences of

pushing the ‘buy’

button in-game”

22

Player immersion, “the sense of being in a world generated by the computer

instead of just using a computer” (Lombard & Ditton, 1997, cited in Ermi &

Mayra, 2005, p. 4), may play a key role in deindividuative behaviour, and also in

determining whether a person is willing to purchase virtual items: “The ferocity

with which realism has been pursued over the brief history of gaming is attested

to by the sheer pace at which new techniques and methods for making games

look more realistic have been developed” (ta, 2010). If a player is going to spend

their money, they have to know they are getting something real in return. A

term used to describe the figurative boundary which gamers need to cross to

experience the immersive realism of a game is the ‘magic circle’, “This can be

seen in the most ready explanation of time; the basically uninterrupted arrow

of player progress through the space of the game” (ta, 2010). Anything from

pop-up menus, clocks or health bars can detach a player from the world they

are entering and remind them that they are simply playing a game. Many games

use techniques to minimise these intrusions, and very few display the real-world

time in attempt to make the player forget about any tasks they might have in the

real world. Some games, such as World of Warcraft (Blizzard Entertainment,

2001), have in-game clocks with their own days, nights and seasons. This

detaches players further from real life where time and space have been altered:

“In this highly intensive state, one is fully absorbed within the activity, and

one often loses one’s sense of time and gains powerful gratification” (Ermi &

Mayra, 2005, p. 2). It is surprising, then, that Habbo and Team Fortress 2, two

games that do have a lot of ‘clutter’ on the game play screen, still sell a large

amount of virtual items. In addition, neither of these games are designed with

realism. Both have a fairly ‘cartoon’ art style and do not attempt to reference

real life particularly accurately. Perhaps then it is not visual immersion here, but

psychological immersion. The introduction of ‘real’ characters, as opposed to

computer-generated characters, may make the game more real and the tasks

more significant. In this case, “the essence of a game is rooted in its interactive

nature, and there is no game without a player” (Ermi & Mayra, 2005, p. 1).

This multiplayer mode also encourages social interaction, which removes the

potential to undo. ‘ta’ (2011) describes undoing as “a practice of play that

illustrates how videogaming is temporarily imbricated in everyday life, rather

than apart from it.” If a gamer converses with another player, or attacks them

in a certain way, they cannot withdraw their actions. If the in-game rules mimic

those of the rules players are used to in real life, perhaps the game will feel

more ‘lifelike’ and thus an acceptable place to spend money.

“In this highly

intensive state, one

is fully absorbed

within the activity,

and often loses

one’s sense of time

and gains powerful

gratification”

“The essence of a

game is rooted

in its interactive

nature, and there is

no game without a

player”

23

There does not seem to be a general consensus amongst video game

players that virtual consumerism is good nor bad, rather that it is

necessary. From analysing the survey results (see appendix), users are either

not aware of the effects of microtransactions, or they are aware but know that

there are pros and cons: “It’s good for the business side of things and adds a

competitive side to the game but it’s not good for the children desperately trying

to fit in” (Habbo survey, see appendix). Those who do purchase virtual items

do not necessarily support the system, and those who do not purchase are not

necessarily opposed to it: “It’s a revenue stream from those who want to buy

these cosmetic things for their characters, but is easily ignorable by everyone

else” (Team Fortress 2 survey, see appendix).

When asked whether they would still play Habbo if there were no furniture

to purchase or own, equal amounts of participants in the survey said they would

and would not. This suggests the diversity of people within the virtual world and

what each of them wants differently out of the game. Some are there for purely

social reasons, and for these users virtual items are not a necessity. Habbo

would be just the same to them without this element, and they may never feel

inclined to spend. Some use the site to excel in a way they cannot in the real

world or to progress in a game that will allow them to achieve, and ultimately

this is only possible by purchasing extra items.

From analysing the questionnaire results it may seem that players chose a

game based on what they want from it, and stick to that game. Over 75% of

Habbo users and TF2 players stated that they do not purchase virtual items in

any other games. Perhaps then, it is simply that Habbo users wish to socialise

and are happy to purchase virtual items within a game which allows them to do

so. Other games may not provide them with the level of social progression they

feel that they need, so they remain faithful to one game. This also enforces the

idea of justification - if they are only purchasing virtual items within one game,

C O N C L U S I O N

“Over 75% of

Habbo users and

TF2 players stated

that they do not

purchase virtual

items in any other

games”

25

it may seem reasonable for them to spend as much as they desire.

The virtual world appears to be teeming with players flaunting their virtual

commodities and promoting virtual consumerism, but perhaps it is not quite

as popular as it seems. In both the Team Fortress 2 and Habbo questionnaires

(see appendix), only 2% of participants in each said that they began playing

the game because they liked the items on offer. This suggests that virtual

commodities may be a necessity as opposed to a source of entertainment,

and may only be purchased once a player is immersed in the game and cannot

progress without them.

However, when asked what they would do if they won the lottery tomorrow,

42% of Habbo players and 40% of Team Fortress 2 players surveyed said that

they would continue to play the game but would not purchase virtual items

within it. This suggests that these items may be considered a luxury; something

that is craved but is unattainable or an unjustifiable purchase. Once these items

become affordable, perhaps they lose their appeal. This could imply then, that

the more money a player has, the less likely they are to purchase virtual items.

Virtual consumerism could simply be a case of wanting what one cannot have.

Surprisingly, a very small percentage (less than 2%) in both questionnaires

stated that if they won the lottery, they would purchase all virtual items within

that game. Perhaps this means that ultimately, the advantages of purchasing real

items outweigh the positive consequences of purchasing virtual items.

Maslow’s (1943, cited in Trigg, 2010, pp. 393-405) theory supports the idea

that gamers may purchase virtual items to climb the hierarchy of needs; to

form friendships, to elevate their self-esteem and confidence.However, perhaps

this is only because, in the virtual world, it is relatively inexpensive to do so. It

is cheaper to buy clothes and weapons; to make friends and progress in virtual

world, but perhaps if a player has ample money in the real world the virtual

hierarchy of needs loses its appeal. This appears contradictory to the amount

of players stating that they do not purchase virtual items because it is a ‘waste

of money’, yet explains why the vast majority of players ‘overspending’ on

virtual commodities are those with little money; children. Oxford (2001) argues

that “children learn how to use technology with remarkable speed, but safely

navigating Apps[2] and the internet in general isn’t an instinctive behaviour.”

It is easy to suggest that it is parents who are encouraging (or at least, not

discouraging) excessive virtual consumerism, but perhaps it is the conscious

decision of games developers to design games tailored to this particular

audience.

Video games, both online and off line, are becoming easier to play. Motion

sensors and touch screens eliminate the need to learn specific controls; the

natural movements involved echo the instinctive movements we are born

with. Games companies are not just interested in maintaining the interests of

existing gamers, but looking to draw in a new, wider audience who may be

avoiding the world of video games due to fear of not being able to play them.

Simpler controls and the accessibility of virtual items that can aid game play,

all contribute to the number of new people trying video games. Social network

games such as Farmville (Zynga, 2009) have spread so rapidly that their names

are recognised even by those who have never played the game.

“When asked what

they would do if

they won the lottery

tomorrow, 40% of

TF2 players said

that they would

continue to play

the game but would

not purchase virtual

items within it”

“Children learn

how to use

technology with

remarkable

speed, but safely

navigating Apps

and the internet

in general isn’t

an instinctive

behaviour”

26

Virtual consumerism seems to function as a means of providing to those

who want more out of a game. When the social and functional aspects

become tiresome, virtual items satisfy the hedonic needs of players who simply

want to flaunt a commodity they have purchased. Perhaps then it is a conscious

decision for games developers to reduce the amount of social, functional or

hedonic qualities in a game in order to sell it back to those who crave more.

Microsoft have recently experimented with a system called “Freemium” on

their Xbox Live Arcade, where gamers can pay one of three prices for a game,

depending on how many features they require (Reynolds, 2011). The hope is

that, after playing the ‘limited’ version, they will discover that they want the extra

features and will ultimately pay for the full game: “It sounds complicated, but

it makes perfect sense and it gives gamers the option of getting the game they

want, at the price they want to pay” (Reynolds, 2011).

This is exactly where the trend for video games is heading - offering a

preview for free or at a reduced cost and allowing gamers to decide how much

a game is worth. Unlike the traditional method of selecting a game based on

advertising and word of mouth and paying a fixed price for it, the latest gaming

allows you to ‘try before you buy’, with the knowledge that you will, most likely,

buy. Just like the carbonated drink Dr Pepper, “To try it is to love it” (Dr Pepper

slogan, 2003). Games companies regularly offer first time players a ‘taste’ of

virtual consumerism by offering free items with the expectation that they will

come back for more. This first time user experience (FTUE) draws players into

a new world, a promise that everything they dreamed of can come true; for a

small price.

It is not just virtual consumerism that affects video games; microtransactions

are everywhere. Consumers are now more likely to purchase singles on iTunes

rather than a whole album from a music store: “Now we purchase content

we want, or we skip it” (Voecks, 2009). Perhaps virtual items are so popular

because they are not confined. Purchasing a new car will not impress people

in virtual world, but purchasing a rare weapon in the virtual world may just

impress those in the real world. An emerging genre named ‘Augmented Reality’

games removes the line between reality and virtuality entirely. They require

users to explore their city, interact with strangers and push boundaries. Players

earn points within the game by completing real world tasks. An example of this

is a game called SFZero (Playtime, 2006), whose main goal is “transforming

its users’ city, country and really the entire world into a playing field where

creativity, guile, collaboration and imagination are rewarded with points, level-

ups, badges and notoriety” (Goetz, 2011). Tasks include flying a kite, creating a

public drive-in movie and burying treasure for another player to find. Evidence

of completion is posted onto the game’s website in the form of photographs

“This first time user

experience draws

players into a new

world, a promise

that everything they

dreamed of can

come true; for a

small price ”

“Now we

purchase

content we

want, or we

skip it”

27

and videos. So far, more than 6,000 players have completed over 13,00 tasks

around the world (Goetz, 2011), and as more games companies explore this

augmented reality genre, the numbers are sure to rise.

It could be suggested then, that video games and the microtransactions

within them are becoming less ‘shameful’ and more a part of everyday life.

When asked in games forums about who consumed virtual items, the majority

of people claimed that they had never bought any virtual items and disliked

the system (see appendix). It is possible that the correct audience - those who

do purchase in-game items - was not reached, but the popularity of virtual

consumerism, particularly within the case study games, suggests otherwise.

Perhaps gamers are reluctant to share their online spending habits with

‘outsiders’ who may not understand their world. Perhaps as augmented reality

games become ever more popular, everybody will be part of the same world.

Traditional consumerism and virtual consumerism will become as one, and the

‘gamer’ will cease to exist.

“Perhaps as

augmented reality

games become

ever more popular,

everybody will be

part of the same

world”

28

29

ACHIEVEMENTS

APPS (MOBILE APPLICATIONS)

MICROTRANSACTIONS

AVATAR

NOOB (N00B)

CREDITS

XBOX

STEAM

FIRST-PERSON-SHOOTER (FPS)

SULAKE CORPORATION

ITEM DROP SYSTEM

VALVE CORPORATION

VIP

[1] arbitrary challenges created by the developer to be met by the player. These may coincide with the key goals of the game itself, but they usually take place outside the confines of the game environment

[2] downloadable facilities such as games, banking and ticket purchasing,

designed to run on smart phones (such as iPhones).

[3] a graphical representation of the user or the user’s alter ego or character.

[4] a virtual currency used in many online video games, such as Habbo Hotel. Generally these have to be purchased with real money.

[5] a video game genre where game play uses first-person perspective. The game is viewed through the eyes of the protagonist, and usually only the hands and weapon are seen.

[6] the main process of item distribution within Team Fortress 2. The system distributes a random item (such as hats and weapons) to players on a regular basis until a weekly time-cap is reached.

[7] a term used for the sale of virtual goods, usually involving a very small sum of money.

[8] a derogatory term for somebody who is a ‘newbie’ to a game and often inexperienced.

[9] a pioneering game platform created by Valve Corporation that distributers and manages over 1,800 games directly to a community of more than 35 million players around the world.

[10] a Finnish social entertainment company focused on online social places and games, established in 2000. The creator of popular interactive social sites such as Habbo (2000) and Bobba Bar (2009).

[11] a special club within Habbo which players can join to get extra things, more than standard Habbos. This includes VIP furniture and access to a different wardrobe of clothing for a players avatar.

[12] a sixth-generation video game console manufactured by Microsoft

[1] an entertainment software and technology company founded in 1996. The creator of many popular games such as Team Fortress 2 (2007), Half Life 2 (2004) and Portal (2007).

30

ATKINS, B.

BRYCE, J. & RUTTER, J.

EYLES, M. & EGLIN, R.

MCGARBVEY, S.

CALLEJA, G.

ERMI, L. & MAYRA, E.

MOJANG AB

NEWMAN, J.

CARDWELL, M . & FLANAGAN, C.

LENNON, J. & MCCARTNEY, P.

FUCHIKOMA

MOLESWORTH, M.

NOBLE, N. & RUIZ, K.

COWAN-JENSSEN, S. & GOODISON, L.

LIEW, J.

GOETZ, A.

MOLESWORTH, M.

DRENNAN, P. & KEEFE, D.A.

MARANO, H.E.

JAKOBSSON, M.

MOLESWORTH, M. & DENEGRI-KNOTT, J.

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