Personally, I don't think monetization through virtual goods is going to work for Western markets unless its a very specified niche market which relies on virtual goods already (i.e. gaming). There isn't enough social/cultural value in virtual goods that justifies the price (even if it is just a few dollars).
Asia is home to a great diversity of cultures and languages, a little more discretion would be appropriate when talking about it in such definite terms.
Whether they know it or not, most people already buy virtual goods.
Every time you buy $150 sneakers, you're buying $120 worth of virtual goods.
Bottle service at a club. $450 worth of virtual goods, $50 worth of alcohol.
An engagement ring. $10,000 worth of virtual goods. $1,000 worth of diamond.
A tier 7 rainment in WoW. $99.999 worth of virtual goods, $0.001 worth of goods.
Etc.
You could send three different kinds of flowers to someone -- a cheap one ($1), a medium priced one ($3), or an expensive one ($10. Yes, $10 for a stupid little flower icon.)
People bought flowers by the hundreds of thousands; they became one of the biggest drivers of site revenue. Moreover, and this is interesting, James said that when someone sent a flower to a person, they were considerably more likely to get a response when sending a message.
From what I gather this is kind of like playing poker, except you can just go out and buy more decks to stack your hand. Just doesn't seem fair or fun to me.
A similar partly-virtual good I can't wrap my head round is intentionally limited-edition goods such as beanie babies.
With the focus now advancing in social media and virtual worlds, I am sure a large portion of users are willing to pay to "look good" or for a show of status.
Now you've just given me a business idea: a gift card that works across different virtual worlds.
Do I think it's a good business model for certain games and game-like interactions? Absolutely.
Do I think it's silly to pay money for virtual goods? Absolutely not. You pay for hapiness plenty of other ways, who cares what the vehicle of that emotion is?
Have I ever purchased virtual goods? Yes. Over $2,000 across 8 games.