Rates of business faliure in SL

My business model from the outset was basically not to have all my eggs in one basket and because of that i've been doing well throughout. Nov and Dec were my worst months which coincided with the implementation of "New Search" ...for that reason i decided to focus on the search engine during Jan.

I have a mixture of Fixed income and Variable Income businesses. My fixed income is Land (Sims) obviously of which all my SIM's are full....so that income does not change much....the variable income comes from companies that provide content. I would have continued expanding into land by simply recycling profits.....but the whole VAT thing put me right off and I feel my Land dealing days are over.

The advantages of this model is that i'm able to absorb any downturns for a particular business by the profits of others. The bigger the model, the better imo,...and partly the reasoning to add new Menwear and Skins businesses to this Group very shortly. By having them all in close facinity and marketing them independently, i benefit from cross traffic as well as being able to cross-market. (Body Shapes & Skins for example or advertising my Shopping Mall on these commerical plots)

New Search is a science in itself and behaves illogically at times. I spent 4 solid weeks improving my positions for all my businesses.......that however could all change overnight, if LL decides to change the weighting of their "relevancy" links.

I run 37 adverts (a mixture of small & medium spend) for my businesses and affiliations. To be honest i'm a bit sceptical of their true value. I have started the process of monitoring the clicks for each Advert on a weekly basis (same day, same time) over a 4 week period. Based on the results, i'll cut away all the "bad value for money" adverts....and spend it on other forms of marketing instead.

I run two businesses - one is niche and the other is fairly new. I have been spending a lot of time on the newer business lately, and as a result, the other business has been neglected a bit, though it is still sustaining itself to a certain degree.

I have been making a small profit and reinvesting it as the need for resources to present new products increases. I run 5 classifieds, ranging between L$50-350. Success of the classified often relies on the sort of product or service being advertised as well as how niche it might be. My $50L ads for specific products not found elsewhere do far better than my more expensive ads for my newer, more mainstream products. I am constantly experimenting with tailoring my classifieds to garner more interest, but I've found that to be hit and miss, especially with the new Search.

The majority of my mainstream traffic seems to instead come from word of mouth, overall visibility from other plots of land, and flybys.

Additional efforts to promote my businesses have extended out of SL and in to advertising on SL related services such as SL Exchange or SL Universe, though I am still gauging the success of those services due to the fact that many folks block ads to begin with, and one such service is now letting non-SL business ads filter in (which will make people less likely to view the ads even more).

I would also consider making connections with businesses that are complimentary to yours and seeking possibilities for a symbiotic relationship of some kind, whether cooperating on the creation of a given product, or cooperating on a common build in order to share business.

Business is good. I was honestly shocked once it got going. I just have to say the first little while is always difficult until you get more well known. Put yourself out there. Once you find your niche and people start to know who you are it gets better. Just have fun, that's what its all about!

sick of it, nahhh

jealous you bet
one day I will be able to afford a sim, and when that days comes I will prolly leave SL

heh

QFT.

I'm probably one of the worst 'people persons' around. And tempermental, and protective. I'm just lucky that a good portion of my customer base is tolerant of abuse.

But seriously, I agree, I have met many very creative people with great talent and ideas, but they just can't handle the business end of it. Being sucessful in business isn't as straightforward as it may seem.

And I'm 'Doing Well'

There's no choice in the poll for "Losing money but feeling successful". I won't be on the cover of Business Week anytime soon. My place loses money on a typical day, even before tier. I judge my success based on how many people are coming in and enjoying themselves. When people tell me that they really enjoy being there, it makes the whole thing worthwhile. I'll eventually get everything tweaked enough to make it self sustaining, maybe even make a couple bucks. Until then, I'll keep running in the red and enjoy it.

I found the same. It really depends which sector you're in. I found low cost Niche and foreign language adverts are far more effective than ones costing 1000's L that advertise mainstream products using the usual common keywords.

I think quality of product, good customer service and word of mouth referrals really go a long way to be being sucessful in SL. As well as being a good creator, you do need to be a good Marketeer and have some sort of business & financial planning acumen.
Eg. Will a 230k advert really be effective for your business or just an ego trip to be on front page of New Search?

I would bet money that most businesses that place adverts of 180k & over, do not make that back in sales in most given weeks. Even for argument sake they did break even or made a little profit (which could be used towards the Tier payment of their Private Island), they might find it more profitable to spend 50k on an advert to generate 100k sales.
The money saved on Classifieds, could be channelled into other forms of advertising, if its exposure that they are after and will cost a lot less too. Hence why I said business acumen......some i believe operate bad business models. You can't buck the market by throwing money at it. It will not make you become a brand leader name overnight!! You won't become a Naughty Designs or an ETD by throwing money at it......not that way!


Also buying a whole SIM for your business, does not necessarly work either. Big is not always beautiful......does not mean you will get anymore traffic automatically because you happen to have a nice driveway with Palm trees leading to your main shop! Again.....another common error. Does work for household names, as they have been developed over time and become a Brand in itself e.g Quad sims or Naughty Island
In a lot of other cases i see more trafffic on my smaller commercial plots than these whole sims.....and i don't have to pay $195 or $295 each month for it.

seems not "everyone's" business is tanking ... /327/45/238348/1.html

you just hit a biggy for me about whut owners of stores put in their profiles...i USED to buy a LOT of clothes in one store...and then oneday i wanted to ask a question about delivery of something (as all their stuff is NO trans) I looked up one of the owners profiles and was disgusted by their attitude. It was so much "dont waster my time" but really...more "go away and die cause im not interested "...I dont think because i buy an item from someone they owe me ANYTHING but...customer service...a small "thank you for purchasing NOW go away and die" wouldve made the diff. But this individual vented about how they HATE people BOTHERING them etc...So...i didnt ask the question...i didnt buy the item..and i no longer shop at that store.
Customer service...is SO important..i suspect this factor plays a large part in a business's decline also. Some HUGE stores...are so so so cool about stuff i have asked or requested...even when i have dropped a line to say "wow, you know..that item rocked-thanks!"...knowing they are busy and yet respond ...is NICE-not obligatory- but NICE.
Fai x

Yep, just read it. January has been good to me......noticed that the login rates quite often flip over 60K, ....SL must be growing again.

Yep, i have seen that in a lot of profiles.....they come across as a being very hostile.! Prima donnas in most cases and full of their own self importance.

I have a bit of a hostile message on my profile too, but it's more to do with Malls...as i'm anti Business-in-box and Camping bot farms and the selling of stolen creations.

Regarding your last paragraph.......thats why they are successful and continue to be so.

In a way having places listed by traffic is good, but makes it hard for new or small buisness to compete with large ones that have lots of traffic. I'm lucky to hit a traffic figure of 2000, a day. how can i compete with places that hit 20,000+/day. I can't. i'm always there for my customers. I have spent 1000's on advertising. But at the rate i'm going i'll be out of buisness by the end of the month. (i've only been in buisness about 2 weeks)

One month is too short a time to "try" out an SL business - it will take longer than than for word of mouth to circulate.

Everyday with more and more residents coming into SL and making content, the competition for content creators is stiffer and stiffer, it was alot easier to make something and sell it say two years ago, now you have 20x the amount of residents, atleast registered avatars, alts included. and atleast that many more people trying to sell thier goods. it only makes sense that business models of the past will have to adapt and advance or fall behind and fail.
I dont so much think its the business that fail, but the business models the business owners choose to establish. Once SL residents wher mostly unique, and each person had a path of thier own, now, most residents are happy to take others idea's, business models, and in some instances content, and call it thier business. Its not the busines that fails, its the resident running the business. They need to start thinking out of the box again, rather than BIAB

I'm doing okay. I've done better, I've done worse.

Fact is, success is partly in the eyes of the beholder. What for some will be a 'small profit', for others will be 'highly successful'

Compared to the 'Anshes', I'm making a small profit.
Compared to "making tier on my 2048 plot", I'm highly successful.

few years back I messaged a content creator who sets the standard now adays for AOs and animations.

I had a product concern and glitch that needed to be fixed and was smacked in the face with the fact that this creator could no be bothered with me or my customer concern.

I quipped that if they weren't interested in customer care..why in the world were they in the buisness of taking customers money?

Their attitude softened..and they laughed asking me where from the United States did I live? I replied that i hadn't menioned I was a US citezen and they explained:

"Customer Service" is a U.S. phenomena predominantly".My mind was boggled. what??..that's not a universal thing?..well I guess not.

If americans will consider and think back on any multi cultural establishment they may have frequented in their lives..wether it be a restaurant in San Francisco or leather bag store in Greenwich Village. we gauge our expectations accordingly on the persons initial attitude..and then later (in the back of our mind couple that with the persons cultural heritage.)

It's different in SL..we see only products..we don't investigate who the creator is behind the product thus our customer expectations are strictly based on what we excpect..nothing more.(/me thinks back to her mother demanding an omelette from an Indian chef who was only preparing waffles and he refused to make anything else..except waffles..my mom..was enraged because this dark skinned "chef" refused her polite request..I on the other hand chosen to write it off as "he's simply a disagreeable person who may have gotten in trouble for this in the past.)Speaking of which I'm a caucasian american and have reservations about snitty petite blondes who seem to care more about their hairstyle that day than wether or not a customer is being satisfied.

That all being said about what makes a buisness successful or not..there ARE certain products out there that sell themselves..the creator views customer complaints as acceptable casualties and prefers to ignore them.

As a builder in SL (thats my main source of income in Second Life) from what i've seen as the new year rolled in..People are still as positive as ever about their dreams of starting their own buisness for 2008..however..they want more for their investment. They dont mind spending the same..or even a more to invest in a quality unique build but they're generally working with parcels..not full sims..and they need their builds to be much more multifacited..for less prims.

This in turn forces me to become more streamlined in my approach to their project. My prices increase slightly because im turning out full sim projects on small parcels however some of my overhead is piped into subcontractors because i (personally) can't keep up with the learning curve. I've had to turn down projects or place prospective clients on a one month waiting list.

As long as this is the case..things are looking up..but..there are really too many variables to factor in.. things like season..(I find people will spend their christmas money in a heart beat for SL and dreams but will die before handing over summer vacation money) Also..if youre an apparel creator..gosh..youre a pea in a sea of others just like you..thinking outside of the box and creating something special has to be almost an unmountable task.

The going out of buisness sales that i've been to and seen..well to be brutally honest..the clothes were quite basic..not alot of imagination..not a large choice and it was obvious that they simply were buried by "better" designers.
A habit i try to keep myself in..is to view and keep afoot of other aschitects in SL..to keep up with the trends and see what they are doing that I can do as well. It's not an easy process for me..(cause in my universe nothing could possibly outshine my vision.) Trust me it's a combination of eating crow while holding my own hand to the fire. The end result though is always positive..generally i discover a new way of doing or building something and the process opens new doors on my own talent.

But definitely what Jackson said about thinking outside of the Box applies here. Simply being able to make shirts and pants and cute lil flexi skirts just doesn't cut it anymore.
I've often asked myself why I don't see this or that in the clothing world and there was a time..where alot of the neat things that exist now didn't exist..so...i certainy dont believe that's the end of it.

~Lana Tomba

few years back I messaged a content creator who sets the standard now adays for AOs and animations.

I had a product concern and glitch that needed to be fixed and was smacked in the face with the fact that this creator could no be bothered with me or my customer concern.

I quipped that if they weren't interested in customer care..why in the world were they in the buisness of taking customers money?

Their attitude softened..and they laughed asking me where from the United States did I live? I replied that i hadn't mentioned I was a US citezen and they explained:

"Customer Service" is a U.S. phenomena predominantly".My mind was boggled. what??..that's not a universal thing?..well I guess not.

If americans will consider and think back on any multi cultural establishment they may have frequented in their lives..wether it be a restaurant in San Francisco or leather bag store in Greenwich Village. We gauge our expectations accordingly on the persons initial attitude..and then later((some of us not all ofcourse)) (in the back of our mind couple that with the persons cultural heritage.)

It's different in SL..we see only products..we don't investigate who the creator is behind the product thus our customer expectations are strictly based on what we excpect..nothing more.(/me thinks back to her mother demanding an omelette from an Indian chef who was only preparing waffles and he refused to make anything else..except waffles..my mom..was enraged because this dark skinned "chef" refused her polite request..I on the other hand chosen to write it off as "he's simply a disagreeable person who may have gotten in trouble for this in the past".)Speaking of which I'm a caucasian american and have reservations about snitty petite blondes who seem to care more about their hairstyle that day than wether or not a customer is being satisfied.

That all being said about what makes a buisness successful or not..there ARE certain products out there that sell themselves..the creator views customer complaints as acceptable casualties and prefers to ignore them.

As a builder in SL (that's my main source of income in Second Life) from what i've seen as the new year rolled in..People are still as positive as ever about their dreams of starting their own buisness for 2008..however..they want more for their investment. They don't mind spending the same..or even a bit more to invest in a quality unique build but they're generally working with parcels..not full sims..and they need their builds to be much more multifacited..for less prims.

This in turn forces me to become more streamlined in my approach to their project. My prices increase slightly because im turning out full sim projects on small parcels however some of my overhead is piped into subcontractors because i (personally) can't keep up with the learning curve((sculpties saving prims and quality 3d textures to save prims)). I've had to turn down projects or place prospective clients on a one month waiting list.

As long as this is the case..things are looking up..but..there are really too many variables to factor in.. things like season..(I find people will spend their christmas money in a heart beat for SL and dreams but will die before handing over summer vacation money) Also..if you're an apparel creator..gosh..you're a pea in a sea of others just like you..thinking outside of the box and creating something special has to be almost an unsurmountable task.

The going out of buisness sales that i've been to and seen..well to be brutally honest..the clothes were quite basic..not alot of imagination..not a large choice and it was obvious that they simply were buried by "better" designers.
A habit i try to keep myself in..is to view and keep afoot of other architects in SL..to keep up with the trends and see what they are doing that I can do as well. It's not an easy process for me..(cause in my universe nothing could possibly outshine my vision.) Trust me it's a combination of eating crow while holding my own hand to the fire. The end result though is always positive..generally i discover a new way of doing or building something and the process opens new doors on my own talent.

But definitely what Jackson said about thinking outside of the Box applies here. Simply being able to make shirts and pants and cute lil flexi skirts just doesn't cut it anymore.
I've often asked myself why I don't see this or that in the clothing world and there was a time..where alot of the neat things that exist now didn't exist..so...i certainy dont believe that's the end of it.

~Lana Tomba

I have the island I always dreamed of, cover the tier and have enough left to have to pay the taxman some, heh - so I can't complain (well, I could complain about the taxman, but such is life)

Second Life business has changed hugely in the last few months. When I was new here, in 2004, the people who sold stuff had skills. Either they had arrived in SL with skills that could be used here - like graphic artists who turned their skills to clothes making.

Other people spent time learning skills within SL - like builders who had to get to grips with prims, or scripters who perhaps adapted previous programing knowledge and learnt LSL.

Now SL has huge numbers of people who are reselling - not actually creating. Mall after mall is full of 'business in a box' (BIAB) products. Many of them old freebies, some ripped-off copies (particularly skins) and others items that have been sold full perms for this reason.
When an item is sold as a BIAB the person trying to resell it has to undercut all the other people who also are trying to sell it.

New people to the game are overwhelmed with free stuff. Which is, in many ways a good thing - but in others a very bad thing.

Second Life is 90% or more created by its residents. That lovely park that you and your girlfriend danced in last night was created by a resident, and is on land that is paid for by a resident. That club you had fun in - another resident's work. Everything you see and do in SL is only there because SOMEONE made it and pays for it to have a home in the game.

I see a time when SL is just one big BIAB mall. People trying to make a quick buck from other people's creations. No one bothering to create things for others to enjoy, because of the fears of being ripped off, or not able to pay tier to place it because no one bothers buying anything anymore.

SL used to be a wonderful place, full of artists and creators and fun.

Now it is a hollow shell. Everyone feels they are entitled to take something out of it, but so few seem to want to work to do so.

*sigh* guess I am feeling very cynical tonight. Just had someone asking me to place one of my prefabs on her land, as she couldn't buy it, she hadn't any money. No please either. When I tried to explain that I have tier to pay, that other people pay for my prefabs, so it would not be fair to give her one, when I don't even know her or anything - she was rude, called me mean and sweepingly called all SL creators stuck up for not giving people like her stuff for free. This is someone who doesn't pay a penny to play SL, who doesn't contribute anything to the world at all - and yet I am the mean one for not giving her a prefab for nothing.

OK, going to bed now - I have finished ranting. Sorry guys. Sometimes SL just really upsets me. I wonder why I bother spending hours trying to create fun things and earn enough to keep my island going - with its little trains and places for visitors to explore and enjoy. Few will miss me, I am not a great artist, just happy to sell a few of the things I make, but when the good creators go, and their lovely places go with them - then where will SL be? Will there even be a SL?

I've had that happen before atleast the person had enough ingenuity to tell me it was an investment in their buisness and I could view it as "free" advertisement on their sim LOL

Sadly i had to weigh in my mind wether or not i felt as if their idea was a high traffic one where people would have the sense to click on my prefab and ask "OMG who built this?"

I opted out

I wanted to give a personal opinion about this whole classified search engine thing that the majority of "content creators" seem to have their back hair up about.

When I created my first product and started selling on SLEX i used classifieds for one week and had my store in search for maybe a month.

I bought banner space once..and when it was used up i never bought again.

It's my personal opinion that if you are creating something new..something fresh..something unique that all this worry and bother with wether or not search is working or wether or not classifieds is working properly probably doesn't even apply to you.

It's the cryings and moanings of the mundane and mediocre that use the search engine and classifieds as a gambling lotto tool or a "fishermans net" to "catch" as many "customers" as they possibly can...not because of their products quality or because they've created something new in SL..but because they've learned how to use and tweak the search and classifieds engine to serve their greatest benefit.

I'm sorry but that's the way i see it. If the search and classifieds engine weren't affected by how much one pays for that classified or how much traffic a persons parcel has(and we all know both those variables have nothing to do with true quality) then what exactly is that engines measuirng stick for quality? Therein lies my speculation on that.

~Lana Tomba

I would believe that, but of course it all depends on how you define "failure." I mean, do you just mean making more from SL than you pay, or is there some cutoff in profit before a business is considered successful?

that turn over rate is high because not many have the patience or the believe in their products and a single delete is easier then sticking to it

I marked small profit. My wife and I together at present make about double what it cost us in tier, sometimes better, but never worse. Nothing earth shattering, but covering all our costs of SL and some folding money to boot is nice. And we have been doing this long enough that the land investment has all been covered as well.

It's hard to know how to answer your poll because the categories (at least, the last couple) are very subjective. What is the difference between "small profit" and "doing well"? I opted for "doing well" myself since while I'm not gonna retire on the proceeds any time soon, I'm earning much more than I expected to when I started my business - my original aim was to make enough from selling my creations to cover my in-world costs and give me a bit of L$ for spending money. I was lucky in that a friend let me use a beautiful spot for my store rent-free for the first month or so, and during that month I earned enough to be able to buy some land of my own, which I moved the store to during month 2. Over the next couple of months pretty much all my profit got ploughed back into land. The month just gone is the first month I've been able to actually cash out my profit, but if I had done so during the first few months the amount I would have been able to withdraw would have been fairly consistent each month - I've been making the equivalent of around US$150 -200 or so per month profit, after tier and costs and in-world spending money. Oddly enough, I seem to spend a LOT less inworld now that I'm spending so much time making stuff for my store... which I don't mind at all. Running an SL business is FUN!

As for Search strategy, I've not really noticed much difference pre- and post-new-Search, myself. I run two ads, one that focuses on the store itself and has a pic of my most popular product line (the quad cat avatars); and another that focusses on my dolphin avatars. I pay L$100 for each of them. I could probably get away with paying the basic L$50 but hey, it's working so I'll stick with that for the time being. I think a big factor in the success of my business (and its findability in Search) is that I was lucky enough to stumble across a particular niche that there are very few competitors in. So if someone searches for "quad cat avatar" or "quadrupedal cat" or "dolphin avatar", my store pops right up on the first page. Helpful, that.

One major element in my "business model" (if you want to call it that) is that I'm all about Low Stress. So while it'd be a lot of fun to buy a pile more land and expand the store and make it all Shiny-Cool, that'd take my overheads up to a point where I'd worry about them and that would sap all the fun out of it, for me. Currently I pay US$40 per month tier and if I didn't make any sales at all in a month I could afford to pay that out of my spending money without any stress at all. I make a point of always having a month's extra tier fee in my US$ balance as well, so at any point in time I have the next batch of expenses already paid for, any any sales that come in are "profit". It means I never stress and worry about financial stuff, and can just relax and build/script/socialise/slack off as and when I feel like it. And that keeps it fun for me. If I were worrying about having to raise a squillion $ a month to cover tier, it wouldn't be fun. And where'd be the point in that?

I shut down my business because I felt that I had made enough money.

omg Donate your brain to science..you are definitely one of a kind.

I didn't know there was such thing.

~Lana Tomba

I never even considered that some people might quit for :"good" reasons.