Advertising Age

NEW YORK (AdAge.com) -- Levi's jeans and Nike sneakers are among the hottest items traded in a virtual world that goes live today.

A $37 million Silicon Valley startup company called There has officially launched its There software application. Users enter a virtual world, or "metaverse," where they can network, hang out, dress up and take on different identities.

Most interestingly for marketers, they can also buy and trade a host of goods. The firm is pitching its virtual universe as a branding vehicle, a market research tool and a means of pre- and post-testing brand attributes and real-world purchasing.

27,000 There
There launched its beta-test form -- 27,000 users have already entered the There world -- in January, with Nike and Levi Strauss & Co. among marketers who partnered with the firm to see how their wares fared in a virtual marketplace. Both brands will continue their relationship with the

Consumers who sign up for the software before Dec. 31 will get a 14-day free trial and an option to purchase a There membership for $19.95 annually or $4.95 per month. Five thousand paying members are already onboard following the beta testing.

Hewlett-Packard Co. will pre-load There software onto its HP Media Center desktop consumer PCs beginning early in 2004, while Comcast Corp., the biggest U.S. cable provider, will offer and promote the application via comcast.com to its more than 10 million subscribers. Other distribution and marketing partners include 3D software providers ATI Technologies and Discreet, and multimedia accessories marketer Plantronics.

There's strategy isn't a straight advertainment or product placement model, said Andrew Donkin, the firm's chief marketing officer. "We are attempting to figure out how to deliver positive brand attributes within a digital environment," he said. "We want to know how long people stay, who the leaders are in the community and who spends the most money."

Levi's-clad
By participating in the beta test, Levi's said it found that its jeans and jean jacket buyers were often experts in various There populations. Other findings: Buyers of Type I Levi's jeans so far have worn their purchases an average of 97 hours in the There community; 53% of the women who made a virtual jeans purchase spent 75% or more of their time socializing in the There clubs, instant messaging and chatting with friends, while women who didn't buy Levi's spent less time socializing -- only 40% spent 75% or more of their time in social activities.

Patrice Varni, director of online marketing and online business for Levi Strauss, said 68% of the visitors to levis.com are women. "This medium uniquely appeals to women, so we are currently exploring There's value as a research tool, building brand awareness and really understanding how people interact with our products online." Consumers can buy select Levi's Type I jeans, jackets and tops using There-bucks at the Levi's in-world store.

Nike features its AirMax2003 unisex shoes and high-end Zoom Celar shoes on the There site. Consumers can try them on, buy them virtually and become faster by using them. Currently there is no real-world online purchase opportunity.

Attracting women
By early next year, iVillage, the online women's network, will have a There destination; kiosks for its astrology property, astrology.com; and will bring along its own advertisers. IVillage will also hold marketing events to promote the association.

"Unlike the standard instant messaging and chat experience, you're not just talking," said Stacia Ragolia, iVillage's vice president for community and services, who negotiated the relationship. Within the iVillage area on There, women can try on clothes and hairstyles, among other things.

"I see it as a chance for advertisers to interact with consumers in a really meaningful way," she said. "This can translate out into the real world into increasing purchase intent."