by Adam Bender | July 5, 2022
In the past few years, there’s been a growing buzz about the metaverse. Everyone wants in on it, but what is it exactly? To simplify, the metaverse is an extension of the Internet’s interactivity, either as another “layer” on top of the real, physical world, or as a digital world unto itself. Imagine, for example, immersing yourself in a virtual concert, complete with dancing partygoers, booming music, and dazzling audiovisual displays. Just such a thing happened in the Fortnite video game in 2020.
Or consider shopping in an online clothing store, where you can reach out and handle the clothes, or maybe even virtually try them on, like a more advanced version of what 3DLook offers. This is the concept of the metaverse: a blending of the virtual and the real. And some experts are predicting it’s going to be big.
• The Information estimates that by 2025, the metaverse will be worth US$82 billion.
• 71% of global executives believe the metaverse will be a positive opportunity, with 42% of them believing it will have a transformational impact on their industry.
• Goldman Sachs estimates that Web 3.0 (a potential metaverse backbone) will be worth US$1 trillion.
In order for retailers to take advantage of this potential, they must adopt several key technologies, chief among them being virtual/augmented reality. For customers to interact with your metaverse shop or brand experience, they need a gateway to the metaverse, and that is what virtual reality (VR) headsets, or upcoming augmented reality (AR) glasses, can offer.
Right now, companies are bridging the gap with 2D interfaces into their virtual worlds, but a truly immersive metaverse mandates VR or AR technologies, which are estimated to reach maturity in the next decade. Anyone who wants to get a jump start into the metaverse would do well to get familiar with these technologies. What this means for retailers in the short-term is that they must quickly become familiar with the principles of interactive, immersive design.
Gucci, for example, leapt headfirst into the metaverse last year when they invested in Roblox, a popular metaverse platform targeted at a younger audience. They created Gucci Town, a branded hub full of mini games and landmarks for players to explore. Gucci Town has been visited over 20 million times, and a vast majority of visitors have returned to it after their initial visit. And off the back of this highly successful marketing campaign, they launched a limited time event within Roblox where they sold virtual clothes and accessories based on their real products. These limited items ended up being massively valuable, with one selling for the equivalent of US$4115, bringing Gucci’s hallmark prestige into the virtual world. By expanding their presence into virtual spaces, companies like Gucci are capturing valuable mindshare for younger audiences.
As far as possible business strategies go, the sky is the limit in the metaverse. Even setting aside those already listed, there are countless opportunities. Marketers may have access to deep troves of data by tracking VR/AR interactions, giving them laser-like precision for target marketing. Retailers can decorate their virtual shops in creative ways that would be impossible in reality, or maybe even create fun retail-centered experiences and activities that encourage consumers to interact with your brand. But that’s just the tip of the iceberg.
Gucci, proving itself a thought leader, unveiled the Vault as a combination online store, metaverse portal, NFT art auction house, discord hub and more. This creative blend of technologies and ideas is what will help any retailer stand out in this space. Word of mouth is more important than ever, and bridging the gap between traditional and fresh forms of interaction with a variety of content will be key to guiding consumers into metaverse spaces.
For a great template strategy to introduce customers into the metaverse, look no further than virtual companion goods. ThatGameCompany sells themed collectibles with a Near Field Communications (NFC) chip inside. When scanned into the game, these collectibles provide virtual items as well, often mirroring the physical ones. This provides a potential avenue for easing consumers into the metaverse, by inviting them into it with tie-ins to products they are already familiar with.
Retaining customers inside your plot of the metaverse is a different challenge, however. It’s not yet clear what appeals most to potential metaverse-browsers, but it’s likely to be a highly social and interactive space. All the metaverse platforms that currently exist are sustained by a social atmosphere, and tools that enable people to share their creativity and passions with each other. Embedding your brand into that social, creative space is likely a good strategy.
Another possible key technology is the blockchain, which could become the backbone of a federated and decentralized metaverse, allowing both retailers and customers to form deep connections inside and across the metaverse ecosystem. Take for example, a platform like Decentraland.
In Decentraland, players have a real-world stake in every inch of its virtual world — plots of land are sold for real money and players hold the “deeds” as Non-Fungible Tokens or NFTs, which are cryptographically protected digital assets that cannot be replicated. Think of them like certificates of authenticity for digital items. This real-world investment extends to every aspect of Decentraland, from land to clothes to art or furniture. And Decentraland has only begun to scratch the surface of blockchain’s true potential.
Interoperability is a key word here: NFTs and other crypto assets are not tied to a single game or metaverse platform. They are portable, much like real goods. As long as a game supports a certain blockchain, it can support every asset, deed, or currency tied to that blockchain. You can wear your favorite real T-shirt anywhere, and with NFTs, you can take your virtual t-shirts anywhere too! With Gen Z and Gen Alpha becoming more and more invested in their virtual lives, this kind of digital ownership will likely experience a boom in popularity over the next few years.
Of course, there are always downsides to any strategy, and metaverse investment is no different. Some studies have found that younger people may not be as receptive as once thought, with one study claiming that 85% of Gen Z respondents feel indifferent about brands in the metaverse. And it’s possible that investors in blockchain may get badly burned, as some people have doubts about the scalability of the technology, and crypto overall seems to be entering another “winter.”
Also unfortunately, the metaverse is simply hard to market. Most people still don’t have a clear grasp on what it is, and even fewer are willing to drop money into the ecosystem. This will likely abate with time, as marketers get more experience and metaverse technologies take a better foothold in consumers’ lives, but it is possible the metaverse will simply fizzle out due to lack of interest or confusion.
None of this is to say the metaverse is hopeless or not worth the effort — far from it, in fact. But as with any change in business strategy, pivoting into the metaverse must be carefully considered to see if it fits your brand, your company, and your strengths. There is a large potential market, but it is likely only certain companies will be able to tap it effectively.
Montreal, QC, Canada (November 28, 2023) – Jesta I.S., a pioneer in the development of an end-to-end Retail. [ ... ]
by Jesta I.S. | October 27, 2023 Whether you're an emerging retailer with plans for rapid growth or. [ ... ]
Montreal, QC, Canada (November 28, 2023) – Jesta I.S., a pioneer…Keep reading
by Jesta I.S. | October 27, 2023 Whether you're an emerging…Keep reading
by Jesta I.S. | September 18, 2023 Navigating the digital landscape…Keep reading
by Jesta I.S. | August 28, 2023 Data is the lifeblood…Keep reading