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Although research on three-dimensional virtual environments abounds, little is known about the social and business aspects of virtual worlds. Given the emergence of large-scale social virtual worlds, such as Second Life, and the dramatic growth in sales of virtual goods, it is important to understand the dynamics that govern the purchase of virtual goods in virtual worlds. Employing the stimulus—organism—response (S-O-R) framework, we investigate how technological (interactivity and sociability) and spatial (density and stability) environments in virtual worlds influence the participants' virtual experiences (telepresence, social presence, and flow), and how experiences subsequently affect their response (intention to purchase virtual goods). The results of our survey of 354 Second Life residents indicate that interactivity, which enhances the interaction with objects, has a significant positive impact on telepresence and flow. Also, sociability, which fosters interactions with participants, is significantly associated with social presence, although no such significant impact was observed on flow. Furthermore, both density and stability are found to significantly influence participants' virtual experiences; stability helps users to develop strong social bonds, thereby increasing both social presence and flow. However, contrary to our prediction of curvilinear patterns, density is linearly associated with flow and social presence. Interestingly, the results exhibit two opposing effects of density: while it reduces the extent of flow, density increases the amount of social presence. Since social presence is found to increase flow, the net impact of density on flow depends heavily on the relative strength of the associations involving these three constructs. Finally, we find that flow mediates the impacts of technological and spatial environments on intention to purchase virtual products. We conclude the paper with a discussion of the theoretical and practical contributions of our findings.

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.

Emerging virtual worlds, such as the prominent Second Life, offer unprecedented opportunities for companies to collaborate with co-creating users. However, pioneering corporate co-creation systems fail to attract a satisfying level of participation and engagement. The experience users have with the co-creation system is the key to making virtual places a vibrant source of great connections, creativity, and co-creation. While prior research on co-creation serves as a foundation for this work, it does not provide adequate guidance on how to design co-creation systems in virtual worlds. To address this shortcoming, a 20-month action research project was conducted to study the user's experience and to identify design principles for virtual co-creation systems. In two action research cycles, a virtual co-creation system called Ideation Quest was created, deployed, evaluated, and improved. The study reveals how to design co-creation systems and enriches research on co-creation to fit the virtual world context. Practitioners receive a helpful framework to leverage virtual worlds for co-creation.

As broadband Internet access and virtual reality technology rapidly expand, virtual worlds and three-dimensional avatars will become more pervasive and widely adopted. In virtual worlds, people assume an identity as an avatar and interact with each other. The objective of this study is to theorize how users form attitudes and intentions regarding avatars in realistic, task-focused virtual world settings. To investigate these effects, this study proposes a conceptual framework based on dual-congruity perspectives (self-congruity and functional congruity). The results show that the more closely an avatar resembles its user, the more the user is likely to have positive attitudes (e.g., affection, connection, and passion) toward the avatar, and the better able to evaluate the quality and performance of apparel products. In the end, these positive attitudes toward an avatar and its usefulness positively affect users' intentions to use the avatar. Based on this study, we propose that avatars representing users' actual appearance may be helpful in experiencing and evaluating some business areas related to users' lives in the real world (e.g., virtual apparel shopping, matchmaking, plastic surgery, fitness clubs, etc.); utilization of such avatars may be a new business opportunity likely to thrive in virtual worlds.

Virtual worlds have received considerable attention as platforms for entertainment, education, and commerce. But organizations are experiencing failures in their early attempts to lure customers, employees, or partners into these worlds. Among the more grievous problems is the inability to attract users back into a virtual environment. In this study, we propose and test a model to predict users' intentions to return to a virtual world. Our model is based on the idea that users intend to return to a virtual world having conceived of it as a \"place\" in which they have had meaningful experiences. We rely on the interactionist theory of place attachment to explain the links among the constructs of our model. Our model is tested via a lab experiment. We find that users' intentions to return to a virtual world is determined by a state of deep involvement (termed cognitive absorption) that users experience as they perform an activity and tend to lose track of time. In turn, cognitive absorption is determined by users' awareness of whom they interact with and how they interact within a virtual world, what they interact about, and where, in a virtual sense, such interaction occurs. Our work contributes to theory in the following ways: it identifies state predictors of cognitive absorption, it conceives of virtual worlds in such a way as to account for users' experiences through the notion of place, and it explains how the properties of a virtual world contribute to users' awareness.

Little is known about how individuals come to relate to settings in virtual worlds (VWs), which are defined as digital environments in which individuals, groups, and even organizations interact in virtual (that is to say, nonphysical) spaces. This research develops a theory of virtual space and place (VSP), specifically relating this to the setting of Second Life (SL), a prominent social virtual world. We explore how three-dimensional space, as perceived by users, is able to provide them with an interactive experience with virtual objects, as well as with other VWdenizens. To test our theory, we build interactive work tools in SL that are designed to reflect various degrees of motion range and to influence presence. The three information technology tools are evaluated by 150 business professionals who are either familiar or unfamiliar with SL. Implications for practice and directions for future research are discussed.

With the rapid pace of technological development, individuals are frequently challenged to make sense of equivocal innovative technology while being given limited information. Virtual worlds are a prime example of such an equivocal innovative technology, and this affords researchers an opportunity to study sensemaking and the construction of perspectives about the organizational value of virtual worlds. This study reports on an analysis of the written assessments of 59 business professionals who spent an extended period of time in Second Life, a popular virtual world, and discursively made sense of the organizational value of virtual worlds. Through a Toulminian analysis of the claims, grounds, and warrants used in the texts they generated, we identify 12 common patterns of sensemaking and indicate that themes of confirmation, open-ended rhetoric, demographics, and control are evident in the different types of claims that were addressed. Further, we assert that the Toulminian approach we employ is a useful methodology for the study of sensemaking and one that is not bound to any particular theoretical perspective.

In this research note, we examine the design, development, validation, and use of virtual worlds. Our purpose in doing so is to extend the design science paradigm by developing a set of design principles applicable to the context of virtual environments, particularly those using agent-based simulation as their underlying technology. Our central argument is that virtual worlds comprise a new class of information system, one that combines the structural aspects of traditional modeling and simulation systems in concert with emergent user dynamics of systems supporting emergent knowledge processes. Our approach involves two components. First, we review the characteristics of agent-based virtual worlds (ABVWs) to discern design requirements that may challenge current design theory. From this review, we derive a set of design principles based on deep versus emergent structures where deep structures reflect conventional modeling and simulation system architectures and emergent structures capture the unpredictable user—system dynamics inherent in emergent knowledge processes, which increasingly characterize virtual worlds. We illustrate how these design challenges are addressed with an exemplar of a complex mirror world, a large-scale ABVW we developed called Sentient World. Our contribution is the insight of partitioning ABVW architectures into deep and emergent structures that mirror modeling systems and emergent knowledge processes respectively, while developing extended design principles to facilitate their integration. We conclude with a discussion of the implications of our design principles for informing and guiding future research and practice.

Game companies use five components—four core components and one complementary one—in a 5Cs model to ensure the control and development of virtual worlds. A multidisciplinary review of the literature reveals that game companies make use of copyright, codes, creativity, and community to do this. They use the contract as a complementary component to reinforce their control over the four basic components and to compensate for the lacunae they present. In order to examine the extent to which game companies use the contract in this way, an analysis is performed of all contractual documents from a sample of 20 virtual worlds, providing evidence of general trends and emphasizing any differences between the virtual worlds in terms of the business and gaming models sought by each game company. An explanation is provided of why these contracts do not constitute a sustainable model for the game companies, given the high level of legal insecurity they present. Some basic recommendations can be made in order to improve the sustainability of the 5Cs model by modifying these contracts in such a way that they are enforceable and by matching their content with appropriate business and gaming models. This could lead to further studies aimed at providing answers to some of the intriguing issues affecting scholars and practitioners.