Americans spent $1.1 billion real dollars on “pretend” virtual goods in 2010. Virtual goods are non-physical digital objects---like avatar clothing, weapons, and graphic themes---that are used in online games and social networks. Sales are projected to increase to $2.5 billion by 2013.

Branded virtual goods are a growing share of that spending. Cascadian Farm was one of the first companies to venture into virtual goods when it sold over 300 million branded organic blueberries on FarmVille. Nestle Purina, Kohl’s, and Nike are also experimenting.

Early learning about the power of branded virtual goods comes from Snoop Dogg’s franchise. His branded digital items command about 2.5 times the price of their unbranded counterparts. Further, consumers who buy branded virtual goods have deeper relationships with his brand.

Virtual goods have been embraced by many online gamers and social network members. Rough 75% of online game fans buy virtual goods. 64% buy at least one item per month. One third of virtual goods purchasers buy them via social networks, and spend an average of $50 per year.

Men are more likely to buy virtual goods then women. But, women who buy spend roughly twice as much.

• Are virtual goods a powerful tactic to support our marketing strategy?
• Should we experiment with virtual goods before our competitors do?