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With the economy in a slump, consumers are spending less at stores. However they are finding the time to purchase virtual gifts. No, not like things from ebay but actual gifts that only exist online. Many come from avatar sites like Gaia but many also come from sites like Facebook.com. According to the article, consumers are spending more time at home and therefore more time on their computers. Tightening the wallet for expensive goods is understandable but when it comes to simple virtual accessories and gifts they think “what’s a dollar?” Sales on these items accumulate to over a billion dollars a year. If you were to ask me, I think the whole thing is silly. I have never used an avatar site, but I suppose that if you do it is important to make your guy look cool; however that seems like a complete waste of money. If consumers were to save the money they’re spending on their avatars they would probably realized that it would amount to a decent sum of money. Just like smokers who don’t think it’s a big deal to drop three or four dollars on a pack of cigarettes, but if they didn’t do that they would have hundreds more to spend. I am an avid Facebook user, but I do not understand the point of spending a dollar simply to send a friend a virtual gift. There are applications where you can send gifts for free. If I am going to spend my money I better be getting something physical in return. The only good thing about consumers purchasing these items is that it could help pull us out of this recession. I am taking macro economics right now and when the country goes into recession the market needs to be stimulated to pull out of it. With people saving more money it just hurts the economy, but with people not seeming to think that these virtual gifts are a waste of money, the economy is being helped.

Article: http://www.nytimes.com/2008/12/08/technology/internet/08virtual.html?_r=1&ref=technology
Sources: http://www.gaiaonline.com/
http://www.facebook.com/home.php#/giftshop.php?ref=sb