Second Life – you know, the online virtual world created by US-based company Linden Lab that is officially classed as a game but has evolved into big business, spawning real-life millionaires who have made a killing in virtual real estate – is at tipping point.

No longer the domain of tech-geeks, Second Life is currently inhabited by around 6,035,000 avatars (digital alter egos of players), while Titanic director James Cameron is currently shooting a film called – yes – Avatar, to be closely followed by Battle Angel featuring an entirely computer-generated female lead. The currency of Second Life, the Linden dollar, is fully convertible to US dollars, and real-world businesses are vying for a virtual presence – especially fashion businesses. After all, think of all those perfect-bodied avatars to dress.

“Aranel is fun and spunky. She is happy-go-lucky and really easy-going but has an addiction to shopping for clothes.” So reads the online description of one avatar beauty applying to take part in Lacoste’s Second Life virtual modelling contest. The French brand has joined the likes of American Apparel, Reebok, Adidas and Calvin Klein fragrances in tapping the growing marketing potential of virtual worlds.

Unlike American Apparel and Reebok, Lacoste has chosen not to open a store in Second Life, but has instead launched a competition on its website, where players can upload images of their avatars to be judged in an online voting competition.

“By going as far as virtualising the product, Lacoste is demonstrating that an item of clothing is infinitely more than a piece of fabric,” says Ivan Beczkowski, web consultant at BETC Luxe, which is behind the Lacoste project and sees it as a way for brands – even luxury ones – to reinforce their identity and engage the consumer.

“By becoming involved in Second Life, Lacoste is investing in this new virtual living space, a space that has become a powerful economic reality and a decisive territory for brand expression and expansion,” adds Corinne Perez, managing director of BETC Luxe.

Well, she would, wouldn’t she – though with avatars such as Anna Avalanche, pictured on the Lacoste website in a revealing Brazilian bikini, and Salvatoree Rossin with his steroid-pumped torso, it’s hard to imagine the style of Second Life avatars fitting in with the clean-cut Lacoste image.

Still, says Cork-based Sabrina Dent, alias Sabrina Doolittle, of Linden Lifestyles, one of the leading Second Life online style publications (300,000 pages per month and a readership of 36,000): “Critically, there are no really effective advertising channels in SL, and therefore no in-game mechanism that allows a brand to dominate, no matter how much they spend. The playing field is still very even between real-world brands and in-world brands and, in fact, the real-world brands do a much poorer job of reaching consumers.

“Having said that, Second Life is a micro economy and there is no real-life brand that’s here to make money. It is an excellent platform for building relationships, cementing brands and building consumer loyalty – yet few real-life brands are doing those things correctly in Second Life,” adds Dent. “Take Lacoste. It has little or no in-world presence; it’s just running a vapid photo contest on its website.”

“Overall, I’d say, most residents are indifferent to the large companies that open outlets in Second Life,” says Celebrity Trollop, Second Life’s fashion oracle and the managing editor of online magazine SecondStyle.com. “Second Life is driven by the new and now. If you open a beautiful store like American Apparel, it will be popular for maybe a month, but as new content fails to appear, traffic and sales will quickly erode.”

So what are the sartorial codes of the virtual world, and how can you win your fellow avatars’ approval?

“Second Life allows you to be a celebrity in your own lunchtime,” muses Dent. “You can design the body you’ve always wanted, and indulge your fashionista fetish for very little money. You can be the most attractive, best-dressed version of yourself you can imagine.”

It figures then that having achieved a perfect body, most Second Lifers choose to flaunt it. Cue an overwhelming array of bootilicious clothing and bare midriffs which would horrify real-life fashionistas. Second-Life style isn’t about the latest Prada shoes and Louis Vuitton ‘It’ bag. Instead, there’s an appreciation of technical craft, especially as anyone with Photoshop can be a virtual fashion designer.

“There are some extraordinarily talented people in Second Life ,” says Dent. “A shoe made by Fallingwater Cellardoor of Shiny Things is a work of art. The opportunity to buy that in Second Life is as compelling to me as a pair of Jimmy Choos.”

Then there’s Crucial Armitage, aka Peter Lokke. A former manager of a Pathmark supermarket for 16 years, he gave up his real- life job to further his career as a virtual clothing designer and land baron, with 70 stores throughout Second Life. One of the 35,500 players experiencing a “positive monthly Linden flow” in April, Lokke says he makes enough money to support a family of four.

“I believe the great majority of players prefer something a bit simpler with a touch of flair and sex appeal to it,” Lokke says. “ I never rush anything I make. It is this process that I think makes my items stand out.”

If uniqueness and craftsmanship count, perhaps more luxury retailers should be getting involved? “The ‘participative democracy’ of the net takes nothing away from the magic of luxury brands as long as their appearances on the web show both understanding of this new world of expression and convey their extraordinary status,” says BETC Luxe’s Perez, referring to the Lacoste project. “I am convinced that internet users will appropriate and twist the codes of a universe that stays inflexible and formatted in reality.”

But to what end? Access to a niche group of online early-adopters with enough cash for the hardware needed to run Second Life? Dent is firm in her belief that Second Life has added value for a brand in witnessing the way players shop. “Anything I see in a high street or a Bond Street window, I can find a semblance of in Second Life, and it has its own couture brands, too .

“What I see an opportunity for, however, is smaller fashion houses trialling design concepts in Second Life . If you’re trying to decide if a consumer group will prefer one pattern over another, Second Life shoppers can very likely provide you with statistics on that. And, with the correct market intelligence, design houses could also extrapolate data about price points – all with corporate anonymity.”

Adds Trollop: “You couldn’t ask for a better creative Petri dish to grow a market winner.”

The bigger issue, then, is how Second Life could change the way we shop in real life. It offers the opportunity to try before you buy. It fosters shifting identities, with avatars changing styles from day to day. (On the flip side, it could also lead to more demanding real- life customers.)

No wonder Aimee Weber, who built American Apparel’s Second Life store as well as virtual versions of the company’s real-life outfits, says: “I predict the real fashion world will have a season or two in the near future that will be advertised and heavily influenced by the virtual worlds.”