PESTEL:

Media Management VT09 HHS

Andreas Bockisch | 70363 | 70363@student.hhs.seCeleste Cantú Alejandró | 70364 | 70364@student.hhs.seNina Steiner | 70385 |70385@student.hhs.seAlejandra Fernandez del Valle | 70391 | 70391@student.hhs.se

What is a Virtual/digital World

Interactive simulated environment accessed by multiple users through an online interface

" There are many different types of virtual worlds, however there are six features all of them have in common:

Shared Space Graphic User Interface

Inmmediacy Interactivity

Persistence Socialication/community

Examples of Virtual/digital Worlds

There are at least 30 Virtual/digital Worlds

○ Second Life○ Active Worlds○ Entropia Universe○ There○ Multiverse○ Varst Park○ Metaplace○ Club Penguin (pre-teen)○ Webkins (pre-teen)

www.virtualworldsreview.com

PESTEL

A PEST(EL) analysis is a strategic tool for understanding market growth or decline, business position, potential and direction for operations. It is used when a business enters new markets and new countries.

SOCIO-CULTURAL FACTORSdemographics, lifestyle trends, population shifts, education, health,

living standards, leisure activities, etc.

Trends in the usage of Internet

http://www.internetworldstats.com/stats.htm

Socio cultural issues

•Social factors profoundly impact user behavior, influenced by subjective norms as well as attitudes.

•From social psychological and economic perspectives, two types of social influence are distinguished:social norms and critical mass.

•Social norms consist of two distinct influences: informational influence, which occurs when a useraccepts information obtained from other users as evidence about reality, and normative influence, whichoccurs when a person conforms to the expectations of others to obtain a reward or avoid a punishment.

Enhance knowledgeIdentification with or against societyComplianceSharing opinion without exposing themselvesAvoid rejection and hostilityInfluencing individualsGeneration of new identities, ”cultures”

Hsu, Chin-Lung & Lu, Hsi-peng, 2003

AGE

http://www.theesa.com/facts/index.asp

Growing number of Virtual Worlds for young users

Second Life: Age and Gender

Age %  

13-17 1.23%  

18-24 27.16%  

25-34 38.88%  

35-44 21.13%  

45 + 11.61%  

User’s ages

0

5

10

15

20

25

30

35

40

18-24 25-34 35-44 45+

0

10

20

30

40

50

60

70

18-24 25-34 35-44 45+

60% Female

Top 5 countries: US, Germany, Brazil, Japan, UK

Resident market share by age tier Average monthly hours by age tier

http://static.secondlife.com/economy/stats_200710.xls Melanie Swan

Usage of Virtual Worlds

Stanford Research Institute found out that 25% of all users spend more than 20 hours per week in Virtual Worlds.

<1 hour           12.5%1-5 hours        26.3%5-10 hours     15.0%10-20 hours   21.3%20+ hours       25%

High engagementmight substitute other media consumption (TV)

http://virtualworldsig.com/2008/03/

Forecast wirtual World Adoption

http://www.worldsinmotion.biz/2008/06/strategy_analytics_1_billion_v.php

1 billion users in 2018

BUT: Growth of Second Life seems to slow downMaybe reaches its peak soon

Need for new concepts

Future of Digital Worlds the value of technology to a user increases with the number of its adopters. As

email systems increased in popularity, for example, they became increasingly valuable, attracting more users to adopt the technology.

Virtual Worlds are created for the new generations: Club Penguin (Pre-teen), which might evolve as new needs might arise in the generation involved.

They are here to stay and make a generational change (including adiction to the game)

Subtituting TV advertisement digital advertisement

Disruptive change, caused by technology and socio-economic changes, due to trends in usage of Internet.

USA military is using virtual life to recruit new memebers.

Companies are using them to learn from themselves

Conclusions

PEST analysis looks at the external business environment and is an appropriate strategic tool for understanding the “big picture” of the environment in which business operates and gives implications how to enable future opportunities and minimize threats.

The demographics profile of virtual worlds shows users who are young but more educated and more affluent than the general public. The phenomenon already reached the stage of a mainstream application, the growth rates seem to slow down.

References

Hsu, Chin-Lung & Lu, Hsi-peng, 2003, “Why do people play on-line games? An Extended ATM with social influences and flox experience” , Department of Information Management, National Taiwan University of Science and Technology, Taipei, Taiwan, ROC, November 2003