Second Life Marketplace -- headed for failure?

Historical perspective

First some background. I've been creating and selling virtual goods since mid-2007. Shortly after I opened my first shop inworld, I created a web-based store at OnRez. (For those who don't remember, OnRez was created as an alternative to SL Exchange (SLX) which at the time, was the main web-based site for virtual goods shopping.) After roughly six months of moderate sales through OnRez, I put all my items on SLX too. Between the two, I did pretty well. In fact, my web-based sales soon outstripped my inworld sales by 3 to 1.

Since I had started with OnRez, I could really see the difference between the two platforms. While OnRez always seemed to me the more organized and elegant venue, SLX clearly had the critical mass of shoppers that made it more viable. As things progressed, my OnRez sales dropped to maybe one-fifth those of SLX. But I always remember thinking how great it would be if someone could take OnRez' good points (real merchant storefronts, customizable product listings, excellent search, working filters) and combine them with SLX's (mass listings, templates, ratings systems, etc.).

So it was with both great anticipation and trepidation that I took the news that Linden Lab had bought both SLX (changed to XStreet SL) and OnRez. For sure the lack of real competition would be a negative, but the potential for the Lab to combine the features of the two services would be a real positive for both customers and merchants!

Alas (and alack), twas not to be the case. All that happened was that OnRez was closed down and XStreet SL was allowed to "bump" along with virtually no changes other than the XStreet merchant forums were closed and forced into a raggedy migration into the SL blogrums.

The dreaded "Freebies Roadmap"

The first hints of real change to XStreet SL came with the abrupt announcement by Commerce Team leader, Colossus Linden, of the "Freebies Roadmap" --an ill-conceived and poorly thought-out plan to treat freebies as "advertising" and charge significant monthly listing fees. While there was some merit to the idea in general, it was presented as a solution to solve the problem of "stale listings". And, it was "sold" as something that merchants had been adamantly demanding.

You would have thought the gates of Hell had been torn open. Between the organized protests at Commerce & Pink's office hours (I participated in one myself) and the posts in the Merchant and public forums, it was clear there was really very little solid support for what Colossus outlined. In fact, the reality was a handful of large merchants had been pushing to remove freebies altogether (so they wouldn't rob sales). Colossus' solution would have still allowed them but it would have been so prohibitively expensive that only those same large merchants could have afforded to offer them. Plus, they would have been completely crippled by being hidden in their own separate area of XStreet SL -- segregated from regular listings -- that even their value as advertising vehicles would have been minimal.

In spite of the numerous calls for a rethink by an overwhelming number of shoppers and merchants alike, Colossus' and Pink's attitudes were essentially -- it's done, we don't need to listen, it's our way or the highway. What really annoyed most of us as merchants was that the Freebies Roadmap did nothing to advance the usability of XStreet SL. In fact, it was perceived by most as a solution to a problem that really didn't exist.

The real problems with XStreet SL

So what were (and are) the real problems with XStreet SL?? Here are my thoughts -- in no particular order of priority.

1. Search has been "broken" for a long time. What you search for is rarely what shows up in results. While there are advanced search techniques available, the average customer of XStreet SL isn't aware of them and gets easily frustrated by what's returned by the default.
2. Inadequate listing categories. Some items, such as clothing, receive relatively high levels of granularity while others, such as textures, get none. Textures for fabric, builds, landscape, clothing, etc. all get lumped into one meta category. Categories are often capricious. In addition, there is no way of listing one item across multiple categories. For example, one of my items can be listed in Chat Devices, Babies or Humorous. But not all three like it should be.
3. No way to combine product listings based on color or size variations. For example, one style of stiletto heels may be offered in 20 different colors. Yet, the merchant has to create 20 separate listings for each color variation. The same holds for other product variants such as size or perms. This problem is awful when applied to inexpensive merchandise. I can't tell you how annoying it is to wade through literally 30 or more (awful) $10L bikinis that vary only in color when a simple customizable dropdown could reduce 30 to 1 listing.
4. Ratings system is easily gamed. While ratings are a good idea and generally helpful, they can be gamed positively through artificial buying or from malicious efforts by competitors. Plus there's no way to pull a bad rating once one's been given regardless of how it came about in the first place.
5. Listings with little or no sales activity are allowed to stay up forever. This is one of the problems the Freebies Roadmap was supposed to address. However, regular purges of items not selling for 6 months or for merchants who haven't logged into SL for 6 months would have solved the problem with far less angst.
6. No merchant storefront capability. OnRez let merchants create virtual storefronts for their products. You got a dedicated URL (www.onrez.com/snickers in my case) that was a nice landing page that showed everything I sold by category. XStreet only offers an obscure Merchant ID number and there is no landing page.
7. Incoherent and inconsistent listing "enhancements". The cost / benefits to different types of listing enhancements are totally out of whack. While some are effective, others, especially those in the clothing categories, are useless simply due to lack of granularity. It's like trying to boldface an ad on Craigslist when every other ad is already boldfaced.
8. No real partnership between customers, merchants and Linden Lab personnel. Ever since Linden Lab took over XStreet SL, the "Commerce Team" has seemed hell bent on straining what little relations existed between the average online merchant. Further, the interaction with those team members has been contentious, one-way and arrogant. This "attitude" continues to this day even in responses to JIRA requests and bug reports dealing with XStreet SL / SL Marketplace issues. Clearly, the Lab has only been listening to very large merchants while actual customers have all but been ignored.
9. An ill-considered attempt to put product wishlists onto Facebook. In spite of  a resounding chorus of "don't waste your time" comments by merchants in the forums, the Commerce Team went ahead and tried (but never really succeeded) to put product wishlists into Facebook. Obviously they never considered that Facebook doesn't allow avatars as users making it a futile exercise from the start. Yet even after being told that, they went ahead anyway. The plug was pulled thank god.

Now a couple things that Linden Lab has done right with XStreet SL is to merge the payment system so you can pay for an item on XStreet SL with your regular SL account AND to promote using XStreet SL to residents. Oh and the Freebies Roadmap was ultimately abandoned due to "technical problems" (but most of us think they realized how ill-considered it was).

And now, the Second Life Marketplace beta

So naturally, one would think going forward, that Linden Lab would look at the landscape of what's available for real life shopping, see what the strong points of OnRez were, see what the strong points of XStreet SL are, and then find out what merchants want and what customers want. BZZZZZZZZTTT. WRONG!!

None of that happened. In fact, the FIRST hint of what was to come with SL Marketplace was when merchants were TOLD they needed to resize all their product photos because the Marketplace would only support images with one fixed aspect ratio. At first, it was going to be 5:4 which caused all sorts of screams from merchants since it's not even a normal SL ratio or real life shopping ratio. Ultimately the ratio was fixed at 4:3 (700 x 525) but it was still a thumb in the eye for most merchants since 90% of all product and package photos are square due to square packages inworld AND due to the fixed ratios for inworld uploads. Oh and you're also now limited to just 8 pictures per listing.

The next clue that bad things were happening was when merchants were told to REMOVE all BBcode and HTML formatting from their product descriptions in preparation for the migration to the SL Marketplace. This was (and is) a killer. Imagine a product listed on Amazon or eBay without bolding, italics, bullets, numbered lists, font changes, underlines, block quotes or links. Yep, that's your new Marketplace. Sterile and wiped clean of any ability to create readable listings for users. One of my own listings has become unreadable in its migration to beta. Coupled with a new limit of 5000 characters for listings, many merchants are starting to throw in the towel.

Oh I forgot to mention -- the rationale for taking this huge step backwards in flexibility over listings is supposedly about creating a more "predictable experience" for the customer. Well I can tell you that NOT one customer I've talked to or read forum posts from thinks this new experience is better. To a person, they all think it's much, much worse.

There are currently some 50+ pJIRAs connected through a meta issue dealing with the new restrictions Linden Lab has put in place. Yet, those working on the SL Marketplace have indicated absolutely ZERO willingness to backtrack and they continue to move toward a less-capable, less-user and merchant friendly web market.

For example, here's a JIRA to restore some sort of formatting ability to listings. In spite of 104 votes for it plus some very rational arguments in favor, the issue was summarily closed by Linden Lab and Brodesky Linden made one comment, "Sorry no bbcode in the site." No reasons, no other comments. He effectively dismissed everyone's concerns with an imperious wave of his keyboard.

Now, one of the biggest issues of all has just cropped up and that's the inability for the new Marketplace to handle "product upgrades". In the past, when a merchant has upgraded a product (like offering a new feature or a script that fixed some bugs), all you had to do was drop the new version into the magic box. As long as the item name was the same, the new version became the new item. NOW, it appears that because the item has a different Object ID, it is going to be treated as a new and different item!!! This means that any product ratings or reviews the item had will no longer apply to the new version!

TOTAL INSANITY!!! I sell a scripted product (Evil Pregnant Tummy Talker) that I've made numerous improvements to. Some are bug fixes, some are actual added features. The product has ALWAYS received 90% 5 star reviews and currently is rated about 4.75 stars. For me to LOSE that rating and all the reviews tied to it just because I added a new feature is just crazy!! Yet, Linden Lab's code rats aren't taking this into account in the new Marketplace. GRRRRR!!!!

Closing thoughts

The Second Life Marketplace beta has shown that instead of moving forward with all the wonderful possibilities for virtual shopping, Linden Lab seems to be moving backwards -- choking the life out of their own platform. And so far, virtually NONE of the good suggestions offered by merchants and customers (ie. those outlined above as XStreet SL limitations) have been put into place.

Where are the multiple product listings? Real storefronts? Flexible listings? Formatting? Working search? All of the things merchants have wanted for years aren't there, but a slew of new technical and policy limitations are. That's not progress. Plus, a LOT of merchants are very disheartened over a "we know better than you" attitude coming from members of the Commerce Team and those responsible for developing Second Life Marketplace.

I sincerely WANT the Marketplace to succeed. If the Marketplace succeeds, I'll make more $L, customers will be happier and Linden Lab will make more real money. So my suggestions and comments are really designed to push in the direction that I and a lot of my fellow merchants see as necessary for that success.

P.S. Philip Rosedale, I hope you're listening 'cuz teh Lab got some 'splainin' to do. You need to kill Mark Kingdon's "predictable user experience" mantra and do it quickly. People didn't join Second Life for predictable experiences. We joined to let our creativity shine.