Hunting for the Answer

Saturday, July 25, 2009 Saturday, July 25, 2009

Over the past few months I’ve been conducting a business experiment. It has to do with those ever-spreading grid-wide hunts.

You probably know all about them, but if you don’t, they’re simply very lengthy treasure hunts, made a whole lot easier by extensive use of teleportation and landmarks. You start at the first landmark, and by finding the potentially impossible-to-find hidden item, you get the clue (and a free gift) to proceed to the next hunt location. It continues through a long string of locations, sometimes numbering hundreds of stops.

Those stops are, of course, SL stores. Participating in a hunt as a vendor takes some effort; it’s more than just dropping a goofy-looking sombrero in an obscure corner of your carefully designed shop.

There are usually a lot of things for shop owners to do during the hunt. Typically torrents of group notices flow by, usually to rearrange the order of the hunt due to dropouts or ejections. Policy matters evolve or dramatic incidents occur. Hunters themselves sometimes require assistance when they get lost or give up. And you have to create a truly unique and interesting gift to attract people back to your store.

So why would a shop owner would bother to take on this extra work?

The theory is that the flow of hunters will result in increased sales: while they’re frantically searching through your shop looking for that pink-ribboned halibut, they’re certain to be amazed by the top quality of your for-sale items and snap up a blingy purseful.

But is this true?

I had to know. I entered a series of hunts over the past several months. Today I examined the stats from such three hunts, including one of the biggest: the May-June SL Discovery hunt, which involved over 500 SL stores across the grid. I also examined statistics for the OMG and FITS hunts.

Aside: 500+ stores is a tremendous number, and traversing the entire chain would be an unbelievably momentous feat. Even more astounding would be the effort required to sort through 500+ gift items, which I suspect almost no one actually does.

The analysis is straightforward: using the SL transaction log, capture the names of all unique avatars who purchased the SL Discovery hunt item. These individuals were clearly in my store, at least briefly. Then compare these names to the names of those who purchased any other items during the same period.

This should catch any hunters who happened to purchase something while hunting, or even those who returned afterward to shop. There is a possibility that someone may have purchased something before they were hunting, but as you’ll see, that’s highly unlikely.

And here’s the results for the May-June 2009 SL Discovery hunt:
  • 2854 unique hunters visited
  • 38 hunters purchased at least one item

In other words, only 1.3% of the hunters actually purchased something. I must say the traffic was fairly large, but even so the amount of sales was tiny compared to the traffic.

How did the two other smaller hunts fare? Even worse. The conversion rate for the FITS hunt was only 0.9% and the OMG hunt was an even lower 0.7%. Total sales were reasonable from the high-volume SL Discovery hunters, but dismal for the other two hunts due to far less volume (346 and 536 hunters, respectively).

What does this mean? Several possibilities:
  • Hunters just want to hunt, and have little interest in shopping
  • Hunters are freebie-types who typically don’t buy anything anyway
  • Hunters are overwhelmed by the size of the hunt and don’t have time to shop
  • Hunters are overwhelmed by the size of the hunt and can’t remember to come back
  • Hunters are not interested in the type of products being sold
  • Hunters have too many free gifts to bother buying anything more

Some conclusions:
  • Hunts are a fair amount of work
  • Hunts tend to provide minimal value to the vendor, at least in my case
  • Hunts are popular; many people enjoy doing them
  • The only hunts really worth participating in are ones with very high volume

Will I be doing further hunts in the future? Possibly, if the hunt’s theme is more directly related to my product line and it’s high-volume. But how to find them? That’s a whole other story.

Oh, you’re wondering what the chart is at the top? It’s the frequency of visitors for the SL Discovery hunt over two months by day. More than half of the traffic comes through the first week and then it drops off quite drastically, but that’s likely because I was #23 on the hunt. 
Good thing I wasn’t #532.


Uccie Poultry said...

Nice analysis. Having participated as a merchant and a hunter I'd say it is spot-on. For the effort I put into one as a merchant, though, I'd say it worked out well for me. Being a Lucky Tribe affiliate has been more rewarding than a grid-wide hunt, though. A few other points I think that need to be made:

1) Hunt creators/managers play favorites, choosing stores to participate based on where they shop and who sucks up to them.

2) Stores that appear later in the hunt chain receive fewer visitors in proportion to how far along the list they appear.

3) It does take long for "cheaters" to cherry-pick the merchants and make lists of certain prizes. Clothes, for example, are the most popular. As my time is limited, I fall in that group but I look for just about anything but clothes.

Keep up the good work! I hope lots of folks read this important post.

for Paisley Beebe said...

But is it any good for raising Traffic, and boosting you in search?

ArminasX said...

Traffic stats? Hm, I'm not sure that traffic is still used in search rankings - but it would be very hard to tell if it made any difference. Consider that you're looking for a traffic increase due to search rankings while there is a traffic increase that causes the search ranking... etc.

Teal Etzel said...

For what it is worth - I have been thinking about this as I enjoy the hunts - and have found some great SL shops as a result. I must admit yours was one of them. I do go back to stores that give out good items and often spend money there but more importantly I do things like subscribe to their blogs. For instance I don't think I have ever purchased anything from your store yet - but your blog is in my RSS feed and as a result I read it. It means your shop is not forgotten and the goodwill must be worth something.
I think the problem is that many shop owners do not get feedback - you can look at stats and work out percentages but very few hunters seem to stop and say I will be back or even thankyou

Peter Stindberg said...

Thanks for putting hard numbers to the impression I had. I participated with GREENE concept in 3 hunts, and only the first - the Vain Inc. Valentine Hunt - provided some tangible results. The other two were plainly a waste of time.

A few additions:

1) There is definitely a hunt-fatigue. The number of gridwide hunts is too large, hunting can become a fulltime job. The initial idea - exposing the hunters to new shops where they have time to look around - has failed due to the sheer size and amount of hunts.

2) We will see a rennaissance of small in-store or in-sim hunts. A managable amount of treasures (<20) in a single shop or a shopping sim. Also we will see a rennaisance of HUD-supported in-sim and in-store hunts, that reward you for completion of hunts. Rika Watanabe has made (with some humble cooperation by me) a Treasure Hunt Server that allows all sorts of interesting hutn setups, from easy to difficult, and is kind of a turnkey-solution for in-store and in-sim hunts. Sales have recently picked up so this fosters my theory.

3) We will see a steep decline in gridwide hunts towards the end of the year since both merchants and hunters will grow weary of them. Already now I receive notices of cancelled hunts.

4) The hunts that will survive will drastically limit the number of participants, with 100 being the maximum. Probably we also see more quality control or HUD assisted hunts.

5) The value of traffic as metric for the importance of a shop will further decline. Traffic is a dead end - merchants want shoppers, not traffic.

6) Last but not least the Designer Showcase Network will become more and more an alternative for merchants to time consuming hunts, bringing directed and interested shoppers into the stores instead of hurried hunters who only grab the price and hop on to the next store.

Chigadee London said...

I have participated in grid wide hunts as a Hunt Administrator and a store owner and see both sides of the issue.

On the Administrative side, we have tried to educate participating hunters on their role:
1. to enjoy exploring the store as they search for the gift
2. Not to complain about the gift and to thank the vendor
3. OPEN the gift (I bet there are still unopened gifts from the Greatest Love Hunts.)
4. Return to the stores they liked to buy an item.
5. We explain that it is only through the generosity of the vendors that hunts are possible.

However, in spite of these efforts, as a Store Owner, I believe there is
1. a growing 'hunt and freebie culture' mentality among new residents who feel entitled to free items.
2. There are also too many hunts on the grid and it is no longer a 'special' event.
3. Most hunts are too large, even with multiple starting points.

My humble advice is that hunts can be a valuable advertising/exposure tool, especially for new creators to the grid.
However, this should be only ONE of the ways of getting the word out on your store and products.
One should also participate in hunts occasionally and not jump in with every hunt going on the grid.

Lette Ponnier said...

Really interesting analysis! I also like the depth of the comments people have been leaving. Here's another contribution....

I'm a very active hunter; I miss very few. If you haven't seen my name on your transaction record, it's more likely I used a different avatar than that I wasn't there at all.

I'm also one of the few who do unpack everything, and I even enjoy it enough to have a series of pictures on Flickr of the random combos of things I unpack. I passionately love vendors who put a lot of effort into the hunts and comfortably gripe about those who seem to be doing it strictly for the traffic. I also make the particular effort to return to stores I like most and spend money there.

It's definitely true that many people are subsistence hunters (i.e., they subsist on stuff they get from hunts). But I'd like to give additional dimension to this analysis:

1) 1% of hunters shopping is not a very surprising number. If I unpack 20 boxes, I'm likely to return to only one of the stores, which is a 5% return rate even for an enthusiast like me. When you enter a hunt, you are in a sense entering into a competition with the other stores for return customers. They aren't simply returning to the stores they like, they're returning to the stores they like *best* (those who return at all, that is). So people with less in-world money than I have probably have a far lower return rate than I do, which means that 1% does sound realistic to me.

2) When I return to buy something, it's often weeks or months after the hunt ended, so the vendors can't necessarily know that I was introduced to their merchandise through a hunt. I did the Ghost Hunt last October and then returned to a store on the hunt to buy the non-Halloween version of their hair in May. That's just how long it takes to go through the merchandise and -- here's the part that your analysis won't pick up on -- become familiar enough with your own new inventory to find that you keep using particular prizes repeatedly. I didn't notice until Ona Stenvaag started thanking me on my Flickr stream for liking the Color Me Chaos prizes that I realized it had become a pattern. Soon after, I went to the store and bought a bunch of things.

3) Don't forget to compare the number of customers you get from hunts with the number of customers you would have had if you hadn't participated at all. Were those 38 people who purchased something a significant or a minimal increase over your usual number of customers? These numbers will have a different meaning for large and popular stores than for small and new ones.

I have many, many other things I'd like to comment on, but I'll leave it there for now.

Valiant Westland said...

Let me preface this by saying I"m no expert in hunts, having partially participated in two since being in SL. (It's a guy thing) Having said this, part of my RL professional expertise is in business workflow optimization and the development of web marketing solutions.

Einsteins definition of insanity is "Doing the same thing over and over and expecting a different result." Perhaps part of the problem in achieving a satisfactory ROI (Return On Investment) for "hunts," lies in using the same old structure and tools.

What if you had a hunt where visitors gained points by touching a unique marker in each store, whose position changed automatically on a daily basis, to prevent people from sharing its exact location with friends. These markers would be networked and the points people accumulated from touching them, along with detailed demographic information such as Avatar ID, age, payment info on file, browse time, etc. would be aggregated in a web-based database.

Instead of giving away freebies at every location, Avatars who earned a minimum # of points by visiting X number of locations, could redeem those points for items sold at participating merchants, much like a Real Life loyalty program offered by an airline. A special networked kiosk could be used at each merchant location, to purchase items using accumulated points. The merchant could choose to offer any number of items for purchase via points.

This type of hunt system would have the following benefits:

* Provide a stimulating contest with immediate positive feedback (points)
* Eliminate the "freebie-culture" element from the hunt
* Allow hunters to accumulate points to purchase items they really want
* Provide merchants with detailed demographic data on their prospective customers
* Integrate with popular 3rd-party Group Management tools (hippoGROUPS, etc.) to enable adding hunt participants to a unique prospect group

If some/all of these ideas make sense to the merchants who are reading this, let me know. I've thought about creating a system like this for some time and would love your feedback!

Quaintly Tuqiri said...

Personally (without having read any of the comments)... when I'm on a hunt, I just want to finish the hunt, especially when there's 300 or more stores participating in the thing. I rarely look around at the merchandise in the store when I'm hunting. I'm focused on finding the hunt object. Plus, with everybody out hunting at the same time, sims can be a little laggier than usual and rezzing is slow. It's not conducive for shopping.

However, once I've sorted the hunt gifts, if I like what I see from the store, I may go back, or at least, I'll keep the name of the store in the back of my mind until such a time as I want a certain type of item. For example, I might not need a particle effect right now, but if I ever do, I would go to your store because I know of your store.

The only problem is the fact that I have to actually sort the hunt gifts so as to find out which stores make stuff I might like... that takes time, and I seem to have an inexplicable aversion to unpacking boxes. I procrastinate terribly on that. If the gifts came in a folder they are more likely to be sorted quickly (again, I speak only for myself). If they were boxed, it's anyone's guess when they'll get sorted. I still have stuff unsorted from hunts in Easter 2008. :P

ArminasX said...

@Valiant - your scheme may work, but some people are now beginning to think the end of hunts may be at hand. In fact, some alternative, more less-burdensome store-discovery services are emerging, such as the Designer Showcase Network.

Eliza Wrigglesworth said...

I'm looking forward to the death of the grid-wide, and I know I'm not alone in feeling this way.

Everybody quotes a different number, but I think anything over 30 or so vendors is just a waste of time, talent and effort for the designers, and a waste of time, effort and inventory space for the hunters.

I purchased Rika's hunt server a few months ago, and she was kind enough to give me a beta version of it which has a new option not yet included in the other. I'm really excited about getting to use it soon. You can make up so many different kinds of hunts, that the fun factor for the hunters will go up tremendously.

Thaumata said...

Nice post.

Have you looked at the Creator's Stamp Rally hunt that is on right now? It's set up very differently from the norm and I think their model is much better for everyone involved.

Whereas the big hunts are usually tons of stores that one can TP to and grab a freebie, the CSR is only about 20 stores, and one must visit all 20 to pick a prize. Furthermore, you must make one purchase (at any of the hunt stores) in order to claim a prize in the end. If you want to choose 5 of the prizes, you must buy 5 items. I think this probably works really well for the merchants involved. I buy tons on this hunt.

As a consumer, I really like that the stores seem to be cherry picked for quality and unique stock. It's never ALL clothes, and the goods are well made and rarely silly things you'll toss in three days time. The prizes are worth the effort!

It's even coded very nicely and the hardware for it (stamp cards and machines, mostly) is very cute and well functioning.

I think it's the highest quality overall for grid-hunts. You should check it out and decide for yourself, though. :)

DVZ said...

A good thread, I hope the merchants find the incentive to continue experimenting with their good will, and marketing.

Suggestion 1: It helps me come back if the merchant's tp link is including along with the next location.

Suggestion 2: It would help me start at the end of the list if reverse links (previous location) were included.

Suggestion 3: If the merchant would include the item snapshot or texture, I would like to try it on while I'm in the store.

Suggestion 4: increase sales by including a (small) gift certificate that expires, say, a month after the hunt ends.

Four months of hunting and a 300% increase in inventory has temporarily burned me out. The Satisfaction Hunt was the best hands down. I found merchants that appeal to my tastes -- and came back for several purchases totaling L$1,600.

That ppl grumbled about the US$ 0.25 fee was, to say the least, entertaining.

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