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This research uses theories of flow, telepresence, positive emotions, and brand equity to examine the effect of using two-dimensional versus three-dimensional virtual world environments on telepresence, enjoyment, brand equity, and behavioral intention. The findings suggest that the 3D virtual world environment produces both positive and negative effects on brand equity when compared to the 2D environment. The positive effect of the 3D virtual world environment on brand equity occurs through telepresence, a specific aspect of flow, as well as enjoyment. The negative effect on brand equity can be explained using distraction—conflict theory in which attentional conflicts faced by users of a highly interactive and rich medium resulted in distractions from attending to the brand. Brand equity, in turn, has a positive effect on behavioral intention. The results suggest that although the 3D virtual world environment has the potential to increase brand equity by offering an immersive and enjoyable virtual product experience, the rich environment can also be a distraction. Therefore, developers of virtual world branding sites need to take into account limitations in the information processing capacity and attention span of users when designing their sites in order to avoid cognitive overload, which can lead to users being distracted from branding information. This paper not only provides a theoretical foundation for explaining users' experience with 2D versus 3D virtual world branding sites, but also provides insights to practitioners for designing 3D virtual world sites to enhance brand equity and intentions through user engagement.

This research uses theories of flow, telepresence, positive emotions, and brand equity to examine the effect of using two-dimensional versus three-dimensional virtual world environments on telepresence, enjoyment, brand equity, and behavioral intention. The findings suggest that the 3D virtual world environment produces both positive and negative effects on brand equity when compared to the 2D environment. The positive effect of the 3D virtual world environment on brand equity occurs through telepresence, a specific aspect of flow, as well as enjoyment. The negative effect on brand equity can be explained using distraction–conflict theory in which attentional conflicts faced by users of a highly interactive and rich medium resulted in distractions from attending to the brand. Brand equity, in turn, has a positive effect on behavioral intention. The results suggest that although the 3D virtual world environment has the potential to increase brand equity by offering an immersive and enjoyable virtual product experience, the rich environment can also be a distraction. Therefore, developers of virtual world branding sites need to take into account limitations in the information processing capacity and attention span of users when designing their sites in order to avoid cognitive overload, which can lead to users being distracted from branding information. This paper not only provides a theoretical foundation for explaining users’ experience with 2D versus 3D virtual world branding sites, but also provides insights to practitioners for designing 3D virtual world sites to enhance brand equity and intentions through user engagement.

This research is a partial test of Park et al.’s (2008) model to assess the impact of flow and brand equity in 3D virtual worlds. It draws on flow theory as its main theoretical foundation to understand and empirically assess the impact of flow on brand equity and behavioral intention in 3D virtual worlds. The findings suggest that the balance of skills and challenges in 3D virtual worlds influences users’ flow experience, which in turn influences brand equity. Brand equity then increases behavioral intention. The authors also found that the impact of flow on behavioral intention in 3D virtual worlds is indirect because the relationship between them is mediated by brand equity. This research highlights the importance of balancing the challenges posed by 3D virtual world branding sites with the users’ skills to maximize their flow experience and brand equity to increase the behavioral intention associated with the brand.

The burst of the dot-com balloon closed the era of Web 1.0. In the process, we observed the creation and disappearance of many small businesses globally. The dynamic and linked web pages provided new pathways to online businesses. However, most of the new online business models still followed the traditional practices of the industrial era which could be characterized by closeness, uniformity, and one-way communication. A new set of new technologies, called Web 2.0, offers new opportunities, blurs the boundaries between online and offline activities, opening a new era with flagships of openness, collaboration, and participation. In this study, by reviewing the properties of Web 2.0, we investigate opportunities for small businesses in the Web 2.0 era. The findings of this study can provide helpful guidelines for small businesses to begin using and leveraging Web 2.0.