Until recently, many prominent brands including Disney, H&M and Coca-Cola were all-in on the metaverse. Now, times have changed and so have the business models within (some of) those companies.
Remember the metaverse?
Not so long ago, many brands were thoroughly fixated on this vague virtual world, a space that comprised both online gaming and virtual reality (VR) and that was typically conflated with blockchain-based web3 technologies such as NFTs and cryptocurrency. Though the concept of the metaverse has been around for decades, it was catapulted into the public psyche after Facebook changed its name to Meta – thereby signaling its pivot from being a social media-first company to being a metaverse-first company – in October 2021. Mark Zuckerberg, the metaverse’s most devoted proselytizer, painted his vision for the future of the virtual world as being one in which the humanity of the not-so-distant future would work, play, date and do just about everything else.
Many brands, captivated by the notion that there could soon be a virtual realm populated by throngs of (mostly young) consumers, were quick to drink the metaverse Kool-Aid. Wendy’s opened up a ‘Wendyverse’ in Meta’s Horizon Worlds; Miller Lite hosted a virtual bar in Decentraland; Playboy built a ‘MetaMansion’ in The Sandbox and so on. Every other day, it seemed, some new brand was eagerly staking its claim in what seemed to be a virtual gold rush.
Then, almost as quickly as it had materialized, the bubble popped.
Following a sharp decline in the crypto market, a general lack of popular enthusiasm for virtual reality-based ‘experiences’ such as Meta’s Horizon Worlds and a surge of popular interest around artificial intelligence, some brands that had previously seemed so enthusiastic about the metaverse dropped it like a bad habit. Others appear to be tentatively treating it as a phenomenon that, like a child’s forlorn toy, has been temporarily abandoned by the culture but might one day be embraced again.
“Many brands were excited about the metaverse … [and] their shift in attention makes sense with the current acceleration and adoption of generative AI,” says author and futurist Cathy Hackl, who has come to be known as the “godmother of the metaverse.”
Hackl believes that although the term ’metaverse’ has fallen into disfavour, it still points to some very real and ongoing technological trends. “It comes down to evolutionary and revolutionary technologies,” she says. “Generative AI went from evolutionary to revolutionary in the last year, and other technology sectors like spatial computing are still in their evolutionary phase. There’s [going to be] a future after the smartphone and a new version of the web will replace the current mobile internet; whether or not we’ll choose to call it ’the metaverse’ remains to be seen. The headlines have moved on from the term but the future has yet to be determined.”
Formerly the chief metaverse officer of Journey, a company that she founded, Hackl’s current job title is chief futurist. “The chief metaverse officer [title] was starting to limit me in some ways and was putting me in a box,” she says. “I felt the need to branch out further since my work encompasses so much more.”
Hackl changing her job title is also perhaps a reflection of a broader trend of tech and marketing experts who are shying away from the terms ’metaverse’ and ’web3.’ To explore this trend a bit further, let’s take a look at the recent career arcs of (in some cases former) metaverse leads within some prominent companies.
Mike White (Disney)
In February 2022, when metaverse fever was starting to heat up across the marketing landscape, Disney tapped Mike White to lead its in-house metaverse initiatives as the company’s executive vice-president of next-generation storytelling and consumer experiences. White had been with Disney by that point for more than 10 years.
The company’s metaverse division was dissolved under the newly reinstated Bob Iger in March and White was let go from the company earlier this month. Disney now seems to be shifting its technological focus to AI.
Pratik Thakar (Coca-Cola)
During his time as the Coca-Cola Company’s head of global creative strategy and content – a position he was first appointed to in January 2021– Pratik Thakar was, like so many marketers, excited about the metaverse. The brand moved quickly in its efforts to establish itself as a pioneer in the web3 space; it launched an NFT campaign way back in July 2021 and a little under a year later released a soda aimed at the gaming community, which it alleged to contain “the flavor of pixels.”
Today, Thakar is still with Coca-Cola as the company’s global head of generative AI.
Robert Triefus (Gucci)
Fashion industry veteran Robert Triefus, who first joined Gucci back in 2008, was appointed as the company’s chief executive of Vault (the company’s online concept store) and metaverse ventures last September. He parted ways with the company about six months later to “pursue another career opportunity,” according to a statement that Gucci provided to multiple outlets at the time. He’s now the CEO of the Moncler-owned fashion brand Stone Island.
Max Heirbaut (H&M)
Sparked by what seemed to be a surge in the market for digital fashion, H&M was another big-name brand that was quick to capitalize on the metaverse. In January, the fashion brand launched Loooptopia, a branded virtual experience hosted on Roblox that emphasized educating users about circularity, or the recycling and reuse of clothing.
Back in May 2022, H&M hired Max Heirbaut to spearhead the brand’s web3 and metaverse efforts as global head of brand experience. Heirbaut still occupies that role, according to his LinkedIn page, and the company as a whole still appears to be committed to building its presence in the metaverse. (“The metaverse offers a new way to look at personal style and the potential of ever-evolving, limitless wardrobes,” the brand wrote on its website earlier this month.)
However, it isn’t the only brand that’s still moving forward with its metaverse and web3 plans. And Heirbaut isn’t the only metaverse lead within a well-known brand who has retained their role, despite the broader cultural shunning of the metaverse; LVMH’s Nelly Mensah, for example, who was named as the company’s global head of web3 and metaverse in January 2022, still appears to be occupying that role, as does L’Oréal’s Camille Kroelly (chief metaverse and web3 officer) and Nike’s Eric Redmond (head of Metaverse Studio).
While Metaverse and Web3 will take a few years to take their full form, advertisers and marketers need to be prepared and get going on it.
Web3 is touted to have the potential to change the way systems work globally. And the world of marketing and advertising is and will not be privy to it. Much like how marketing took the form of digital marketing, it will now have to embrace the possibility of becoming decentralized in nature and adapt to the technologies of Web3 and Metaverse.
While Metaverse and Web3 will take a few years to take their full form, advertisers and marketers need to be prepared and get going on it.
Why the need to adapt?
Brands such as Nike, Hyundai, Adidas, Gucci, Louis Vuitton, and Samsung have embraced the virtual world and made it work for them. Demand Sage shared that the majority of revenue earned by the Metaverse came from advertising and made USD 114.93 billion in 2021.
Thoughtworks, in April, announced the purchase of its digital land in Jump.trade’sDX Racing Metaverse to leverage innovative ways and broadcast their brand and message. In March, Maggi announced the launch of its NFTs on OneRare Foodverse for reaching out to their fans and foodies in an all-new avatar. Puma announced Black Station 2 as an experimental 3D spatial playground for users to explore the virtual experience offered and/or mint NFTs by connecting their wallets.
“Brands should consider Web3 and Metaverse advertising and marketing over traditional methods due to the unparalleled potential for immersive and interactive experiences. By embracing these innovative approaches, brands can enhance their brand awareness, foster customer loyalty, and drive meaningful connections with their target audience. More importantly they no longer are constrained by geography and can sell to/engage customers anywhere literally,” shares Piyush Gupta, CEO, VOSMOS, a Web3 and Metaverse-oriented marketing company,
The user base will expand
Long story short, the user base for Web3 and Metaverse platforms will keep on increasing. The key reason for it is the control over data and the increase in privacy and security. Metaverse is reported to currently have 400 million monthly users as of 2023 and is expected to reach 800 billion users by 2028.
Users are and will be drawn to the virtual and decentralized world because of features such as ownership and control of digital assets, data and identity, transparency and trust, and enhanced privacy and security.
“With this strategy, brands may capitalize on the expanding trend of digital innovation while forging closer ties with their target market and staying ahead of the competition,” shares Hiren Shah, Founder & Chairman, Vertoz.
Why marketers and advertisers should tap into it
User engagement, direct communication, data ownership, and tokenization are the main reason why marketers and advertisers should tap into Web3 and Metaverse.
Tokenization- Tokenization lies at the centre of Web3 as a concept. With cryptocurrency and NFTs, brands can create an incentive system for users upon engaging with the brand content. The users can be rewarded with tokens which in turn can be utilized with the brand.
User engagement– Web3 will bring transparency to the table for the two parties. The relationships on this platform will be built on direct communication and trust. Marketers and advertisers will be able to learn the likes and dislikes of their target audience and how they engage with a brand publicly.
No middleman involved– The concept of tokenization and smart contracts will help remove intermediaries and middlemen from the process. Marketers and advertisers will be able to directly incentivize users to engage with them without any platform or ad networks coming in between. When it comes to marketers and advertisers, and influencers, the two can strike a deal with the need of any intermediaries, such as talent agencies or influencer marketing platforms.
Data ownership- Users will have more control over their data and will have more privacy and security. The data can be monetized by the user at will. A possible aspect of Web3 can be focused on enforcing data confidentiality and integrity on each transaction by having the owner of the wallet ‘sign it’. This concept can see advertisers and companies seeking permission from the user to access and use their data and have the user be compensated accordingly.
When should a brand think of using Metaverse and Web3?
“Firstly, understanding their target audience’s presence and engagement within these platforms is crucial. Secondly, brands should ensure their messaging and experiences align with their core values and resonate with the audience in the virtual space. Lastly, brands need to evaluate their technological readiness and capacity to provide immersive experiences,” shares Shah.
“There needs to be clarity on why the brand is getting into metaverse and what the short and long-term goals are. For example many brands are not there for sales but to reinforce and deliver a more immersive brand experience to their consumers. Second is ensuring readiness in terms of scalability and accessibility, in order to deliver a consistent and effective experience to a diverse and global audience, before taking the plunge. Half-hearted attempts simply backfire and do more harm than good. Last, look at aspects like security since web3/metaverse needs to be seamlessly integrated into the company’s existing systems/channels and that poses a potential threat if not well protected,” adds Gupta on being asked the question.
Covering news and trends in AI and Metaverse segments. An avid book reader running her personal blog on the side. You may reach me at paromita@entrepreneurindia.com.
Businesses will soon need professionals whose job is to create a presence and potentially build with Web3 technologies and concepts in the metaverse — and there’s plenty that businesses can do now to prepare for that.
Twelve years ago, companies didn’t hire social media talent — they didn’t think they needed it. But now? Businesses need social media directors and entire social media teams. The same is true for playing in the metaverse.
It is my belief that within the next three to five years, a minimum of 30% of business is going to come from a blend of metaverse experiences and implementations of Web3 technologies (e.g. artificial intelligence, virtual reality and nonfungible tokens, or NFTs). It is essential for creative agencies (e.g. advertising agencies, marketing agencies, etc.) to prepare how they will play a role in the metaverse now so their customers will be able to find them.
The big three
The first step in preparing for the metaverse is for creative agencies to decide which of the three roles they will play — either the expert experimenter, the contributor or the activator. Making this decision now will help companies get ready for when their customers arrive in the metaverse, and it’s only a matter of time before they do.
Expert experimenters. Theseare businesses that have an understanding of the metaverse already. To find out whether they are in this group, business leaders can ask themselves if their business strives to be the deep subject matter expert on all things in the digital universe, or whether it’s an early adopter at the vanguard of new technologies. In that case, they need to understand the technologies involved within the metaverse and how Web3 is speeding up evolutions and revolutions.
Contributors. These are businesses that are still in their infancy in terms of embracing this new wave of technology and deep subject matter expertise is not required. Creative agencies in this group can introduce their client partner brands to the metaverse and converge their physical and digital presence in a way that is profitable and meets customer needs.
Activators. This last group is made of businesses that focus on seeking ways to offer holistic experiences for businesses and audiences to have within the metaverse. Businesses in this group are like a hybrid between the expert experimenters and the contributors.
Nevertheless, whether you know a little or a lot about Web3, you can’t afford to be left out completely; defining your role is an essential first step in preparing for the integration of the metaverse. People are investing in the metaverse heavily. It’s expected to reach $5 trillion in value by 2030, and this number is exponentially growing each and every month.
Next steps
After leadership at creative agencies decide which role they want to play, they need to develop a strategy and strengthen their online presence. To do this, they will want to hire people whose job it is to prepare the company to implement itself into the metaverse, in whichever role the company has chosen to take. Doing this will help them strengthen their brand identity — and thus, brand loyalty — before the metaverse fully arrives (and it’s coming sooner than we think).
Additionally, leaders and creatives should focus on user experience. What kind of experience do they want their customers to have with their business in the metaverse? This is essential for brands getting established in the metaverse because if they can think one or two steps ahead of what their customers will want when they emerge into the metaverse, brands will be there waiting, ready to give customers what they’re looking for.
Finally, it’s critical for creative agency leaders to remain adaptable as they learn more about the metaverse while it’s still unfolding. Staying adaptable and remaining at-the-ready for change will help agencies stay ahead and prepared to meet customers when they find them in the metaverse.
The importance of Web3
Even if your agency isn’t embracing extended reality and other metaverse projects, experiences and communities quite yet, many of your client partners’ customers are. And arguably, meeting customers where they are is the single most important piece to building brands and businesses that grow and transform.
The metaverse isn’t just a probability — it’s inevitable. Throughout the evolution of the internet, waves of advancement emerged because of technological advancement. The internet went from simply being a new technology to sharing the world of information through web browsers to developing social media. Underneath all that were advancements in the programming language, faster internet speeds and, of course, the smartphone.
Now, we are in a new wave: the wave of augmented reality (AR), VR and mixed-reality experiences with the technologies to make them work even more soundly and profoundly. If you haven’t begun exploring immersive platforms and how you can approach conversations and tactics related to the metaverse with your client partners, the time has come.
The natural progression
If trends in technology really do repeat history, then it won’t be long before hanging out in the metaverse becomes more mainstream. We must watch where people go. An immersive virtual world in which customers socialize, shop, relax, work and play isn’t so far-fetched anymore.
Given there was a time when people thought the idea of online dating, smartphones, social media and real human connection online was scary and too futuristic, it makes sense that agencies might be facing those same fears about the metaverse. The popular movie Her may have seemed sad and dystopian, but there were some interesting predictive themes being provoked in that film. Concepts like love, connection, relationships, identity and community will evolve as they always have over time.
However, knowing what we know now, we understand that embracing new technologies is far better than avoiding them. And for creative agencies, it’s much more profitable. The metaverse is becoming so much more than a buzzword, and the reality is that advertisers and marketers will be doing business in a virtual world at an exponential rate as seamlessly as they advertise on social media — and very soon. Blending our real and virtual lives has already begun, and the sooner you get on board, develop a point of view and experiment, the better.
Businesses will soon need professionals whose job is to create a presence and potentially build with Web3 technologies and concepts in the metaverse — and there’s plenty that businesses can do now to prepare for that.
Twelve years ago, companies didn’t hire social media talent — they didn’t think they needed it. But now? Businesses need social media directors and entire social media teams. The same is true for playing in the metaverse.
It is my belief that within the next three to five years, a minimum of 30% of business is going to come from a blend of metaverse experiences and implementations of Web3 technologies (e.g. artificial intelligence, virtual reality and nonfungible tokens, or NFTs). It is essential for creative agencies (e.g. advertising agencies, marketing agencies, etc.) to prepare how they will play a role in the metaverse now so their customers will be able to find them.
The big three
The first step in preparing for the metaverse is for creative agencies to decide which of the three roles they will play — either the expert experimenter, the contributor or the activator. Making this decision now will help companies get ready for when their customers arrive in the metaverse, and it’s only a matter of time before they do.
Expert experimenters. Theseare businesses that have an understanding of the metaverse already. To find out whether they are in this group, business leaders can ask themselves if their business strives to be the deep subject matter expert on all things in the digital universe, or whether it’s an early adopter at the vanguard of new technologies. In that case, they need to understand the technologies involved within the metaverse and how Web3 is speeding up evolutions and revolutions.
Contributors. These are businesses that are still in their infancy in terms of embracing this new wave of technology and deep subject matter expertise is not required. Creative agencies in this group can introduce their client partner brands to the metaverse and converge their physical and digital presence in a way that is profitable and meets customer needs.
Activators. This last group is made of businesses that focus on seeking ways to offer holistic experiences for businesses and audiences to have within the metaverse. Businesses in this group are like a hybrid between the expert experimenters and the contributors.
Nevertheless, whether you know a little or a lot about Web3, you can’t afford to be left out completely; defining your role is an essential first step in preparing for the integration of the metaverse. People are investing in the metaverse heavily. It’s expected to reach $5 trillion in value by 2030, and this number is exponentially growing each and every month.
Next steps
After leadership at creative agencies decide which role they want to play, they need to develop a strategy and strengthen their online presence. To do this, they will want to hire people whose job it is to prepare the company to implement itself into the metaverse, in whichever role the company has chosen to take. Doing this will help them strengthen their brand identity — and thus, brand loyalty — before the metaverse fully arrives (and it’s coming sooner than we think).
Additionally, leaders and creatives should focus on user experience. What kind of experience do they want their customers to have with their business in the metaverse? This is essential for brands getting established in the metaverse because if they can think one or two steps ahead of what their customers will want when they emerge into the metaverse, brands will be there waiting, ready to give customers what they’re looking for.
Finally, it’s critical for creative agency leaders to remain adaptable as they learn more about the metaverse while it’s still unfolding. Staying adaptable and remaining at-the-ready for change will help agencies stay ahead and prepared to meet customers when they find them in the metaverse.
The importance of Web3
Even if your agency isn’t embracing extended reality and other metaverse projects, experiences and communities quite yet, many of your client partners’ customers are. And arguably, meeting customers where they are is the single most important piece to building brands and businesses that grow and transform.
The metaverse isn’t just a probability — it’s inevitable. Throughout the evolution of the internet, waves of advancement emerged because of technological advancement. The internet went from simply being a new technology to sharing the world of information through web browsers to developing social media. Underneath all that were advancements in the programming language, faster internet speeds and, of course, the smartphone.
Now, we are in a new wave: the wave of augmented reality (AR), VR and mixed-reality experiences with the technologies to make them work even more soundly and profoundly. If you haven’t begun exploring immersive platforms and how you can approach conversations and tactics related to the metaverse with your client partners, the time has come.
The natural progression
If trends in technology really do repeat history, then it won’t be long before hanging out in the metaverse becomes more mainstream. We must watch where people go. An immersive virtual world in which customers socialize, shop, relax, work and play isn’t so far-fetched anymore.
Given there was a time when people thought the idea of online dating, smartphones, social media and real human connection online was scary and too futuristic, it makes sense that agencies might be facing those same fears about the metaverse. The popular movie Her may have seemed sad and dystopian, but there were some interesting predictive themes being provoked in that film. Concepts like love, connection, relationships, identity and community will evolve as they always have over time.
However, knowing what we know now, we understand that embracing new technologies is far better than avoiding them. And for creative agencies, it’s much more profitable. The metaverse is becoming so much more than a buzzword, and the reality is that advertisers and marketers will be doing business in a virtual world at an exponential rate as seamlessly as they advertise on social media — and very soon. Blending our real and virtual lives has already begun, and the sooner you get on board, develop a point of view and experiment, the better.
Social media is the archetypal web2 application – the enabler of the “user-generated web”. But that doesn’t mean it will die out with the onset of the metaverse and web3. In the metaverse, features and functionalities we’ve all become accustomed to – “liking,” “sharing,” and the “for you” page – are no longer confined to social applications. They are there when we are gaming, working, learning, or whatever other activities we are getting up to within connected, virtual worlds.
And just as social media is one of the foundations the metaverse will be built on, the metaverse, in return, will impact the way we think about and use social media. If you’ve tried Meta’s Horizons, you will appreciate that many of the core features and functionalities of its 2D, blue-and-white predecessor are still very much a part of the platform. Profiles, “like” and “share” buttons, for example, are all still there, only they’ve been given a new, more immersive, experiential lick of paint.
So how can we expect social media to evolve over the next five to ten years as the metaverse begins to coalesce and take hold of our lives? Will the term become redundant – not because we stop using the web to be social, but because everything on the web will become social, connected, and without borders? Or will a backlash against the increasingly ubiquitous liking, sharing, and showing-off lead to more insular internet experiences where we exert more caution and discretion over what we share and who we share it with?
Immersive Social Media
One way to think about the metaverse is as an amalgamation of gaming, productivity tools, e-commerce, and extended reality (XR) – which includes both virtual reality (VR) and augmented reality (AR AR-3.8%) and, of course, social media.
Gaming, productivity tools, and e-commerce provide us with activities to keep us busy in the metaverse – working, playing, and shopping. XR features ensure it is immersive and provides us with a heightened sense of “being there.” And elements of social media ensure that the experiences are connected to the real world – because we will be sharing them with real people.
So social media platforms in the era of the metaverse may be more geared towards providing immersive, interactive experiences that stimulate as many of our senses as possible – rather than just connecting us to our friends over 2D web pages.
This means that when we connect for a catch-up, we will meet up in any environment that can be imagined. Virtual reality can already provide us with lifelike sights and sounds, and it’s increasingly able to simulate other senses, too, such as touch and smell. So while texting or a video chat might seem like a nice way to keep in touch with a loved one while we are separated today, in the near future, we may be able to walk hand-in-hand with them across a beautiful meadow, breathing in the scent of flowers as you go.
Augmented Reality
Unlike VR, which involves stepping inside a virtual world, augmented reality overlays computer graphics on the real world we see around us – either via a phone or glasses.
Xone is an example of a web3 social media service – with functionality built around blockchain and NFTs – that leverages AR to allow users to create and share virtual worlds.
Users create and interact in two different types of zones – called xones. Personal Xones fill the function of the profile pages we are used to seeing in “traditional” social media, whereas Community Xones can be used to host events, gatherings, launches, or any other type of immersive social group activities.
I recently spoke to CEO and co-founder James Shannon, who told me that the idea is for every user to create their own immersive, 3D space that they can share with visitors. While hanging out and enjoying the environments available, users can listen to music together and take part in games and entertainment. Many of the features will immediately look familiar to anyone who has grown up with web2-style social media. However, Shannon tells me, “When you first open the Xone app, the first thing you think is that this looks a lot like the apps I’m familiar with. You have a home feed and the ability to Like, Comment … the core difference we introduce is that rather than clicking someone’s profile and seeing a two-dimensional grid of pictures, clicking their profile enters you into an immersive three-dimensional world that you can explore in AR … the content you can explore and visit and share is not 2D content but 3D, immersive worlds you’re sharing through the network.”
Advertising and Branding
Perhaps above all, the metaverse will be seen by businesses as an extension of their ability to advertise and promote their products and services in our lives. Just as new forms of advertising have emerged through web2 social media – think of the influencer explosion that has redefined the marketing industry – web3 will bring new ways for building hype and excitement around brands.
Brands including NikeNKE-0.8%, Gucci, and McDonald’sMCD+0.8% have already begun creating virtual versions of their products that can be sold as NFTs within digital worlds. These can be used to decorate avatars and virtual spaces. Clearly, they are hoping this will lead to the emergence of “influencer avatars” who will lead the buying decisions that the rest of us make as we shop in the metaverse. Creative brands will also lead the way in using metaverse functionality – VR, virtual worlds, augmented reality, for example – to create new and more immersive customer experiences that build brand awareness and identity with the ultra switched-on and connected younger generations.
Will social media be safer in the metaverse?
An important issue that will have to be addressed is the potential for harm that may be caused by social media that’s more immersive, engaging, and quite possibly more addictive than anything we have seen before.
For all the positive benefits it brings to society, such as making it easier to connect with friends and family, traditional social media has also been accused of enabling harmful behaviour such as cyber-bullying, harassment, and the spreading of conspiracy theories and fake news.
A new, more immersive social media – one that’s harder to walk away from simply because it’s so much more engrossing and entertaining – clearly has the potential to magnify these threats. This could make the web3 version of social media a dangerous place. Anyone wanting to explore there and make their mark will need to take care that they understand these hazards and are familiar with the tools that platform providers put in place to limit the danger. Meta, for example, was prompted to add a “safe zone” feature that allows users to instantly create a barrier around themselves when early adopters complained of “virtual groping” and other unpleasant behaviour.
A Whole New World
In many ways, the future of social media is intrinsically linked with the future of the metaverse. One way of thinking about it is that the metaverse simply is the next evolution of social media – just as it is the next evolution of online gaming, remote working, and e-commerce. Platforms like Facebook and Instagram are already pulling these different facets of our digital lives together under one roof. The metaverse simply allows us to step inside and experience it all together, immersively, rather than being limited to scrolling through it on a flat screen. Everything we love about social media – as well as everything we hate – will be magnified and intensified because of this, but at the same time it will open us up to a new world of experiences to share with our nearest and dearest. Personally, I can’t wait to see what is in store!
You can check out my webinar with James Shannon, CEO and co-founder of Xone, here, where we deep dive into aspects of how the metaverse will change social media.
The metaverse is definitely an exciting and fast-moving area. To stay on top of the latest on the metaverse and wider business and tech trends, make sure to subscribe to my newsletter and have a look at my book Extended Reality in Practice, which just won the Business Book of the Year 2022 in the Specialist Book category.
Bernard Marr is an internationally best-selling author, popular keynote speaker, futurist, and a strategic business & technology advisor to governments and companies. He helps organisations improve their business performance, use data more intelligently, and understand the implications of new technologies such as artificial intelligence, big data, blockchains, and the Internet of Things. Why don’t you connect with Bernard on Twitter (@bernardmarr), LinkedIn (https://uk.linkedin.com/in/bernardmarr) or instagram (bernard.marr)?
Look at any Target or Walmart store on a Saturday and watch as customers perfectly dominate the essence of physical-to-physical commerce. In fact, just the experience of being in a physical location leads most customers to make purchases far beyond their shopping lists. That’s the reason why brands spend millions of dollars on physical retail locations because they feel confident they can elevate and capitalize on the on-site shopping experience and the “serendipity” that happens in the store. Whether it’s waiting in a queue to enter the Louis Vuitton Maison Vendôme store in Paris or going down an in-store slide during a Showfields shopping adventure in New York, the world of physical retail has become more experiential and glitzy. It is one of the drivers of BIG retail.
But when we start to think about a brand’s physical footprint in virtual economies, we seem to falter. Does this footprint have a “toe hold” in the virtual world? I say a resounding yes!
As I continue to advise and work with brands in this new space, it is evident from my perspective that new commerce models are evolving, but they have not been done at scale. Even while the Metaverse is in a nascent state, these models will have a significant impact on customers’ choices and purchasing decisions. My advice to you is to buckle up, because we’re about to head into the future of commerce!
As a IMPORTANT note, we can all acknowledge that the Metaverse has serious implications for society. For example, one of my previous articles from August 2020 explored ethics and privacy in the metaverse. The article you are reading right now is specifically written to explore and present new commerce models, and should not be interpreted as the only thing of importance as we build the Metaverse. The intention of this article is to shed light on these new commerce models to create awareness and explore the possibilities of how commerce will transcend eCommerce and physical retail and also give professionals the nomenclature they might need as they explore these new spaces. These new commerce models should be approached delicately and with community and value creation in mind, for many of us, the hope is that potentially a web3 ethos of openness will also be adopted.
Virtual and Physical commerce collide as we enable the creation of the Metaverse. These new commerce … [+]
For centuries, the only viable marketplace (except for a “Sears” catalogue back in my parents’ time) was physical-to-physical (P2P). Customers went to a physical location, selected a product and exchanged physical “fiat” money in person for the material goods they wanted.
The dawn of the internet introduced new marketplaces for exchanges starting with social media apps and eCommerce. In the dawn of the metaverse and the coming era of web3, commerce will evolve and with this evolution, new models will emerge.
The marketing strategies, and even the products that brands will sell, will be different as we head into the successor state to today’s mobile internet, the metaverse. Whether the products are physical or virtual, professionals will have to consider demographic and psychographic data, skill-building and gamification, user interaction, events/experiences, digital twin technologies, and creating a unified commerce front…all with the intent of encouraging engagement with a product or service. Then add a layer of complexity to the mix when you factor in the importance of community, fandom, and authenticity and their impact on a fan and/or customer’s choices in the physical and virtual realms.
Many professionals use the term in-person shopping to differentiate it from virtual. I would suggest that all shopping is in-person, even if it’s done on a virtual platform or for the benefit of an avatar or a virtual home. There is still a human behind the decision making and the final purchase! (at least for now)
Is the Market Ready? Are You?
Direct to avatar was just the start. getty
According to a recent BigBusiness blog, “brands that do want to spend some of their marketing dollars on Metaverse tech should look for things that already work and then figure out how to make them even better with immersive tech.” Moreover, brands should start this process as soon as possible since the “new” costumer is already there.
A recent survey conducted by Zipline (one of the world’s largest delivery drone companies) suggests that 85% of Gen-Z respondents, 75% of millennials and 69% of Gen-Xers responded that they would be interested in hybrid shopping experiences, which include using mixed reality in retail stores and for online shopping. “The key is to engage consumers with entertaining and accessible digital content that lowers the barriers to entry and meets Metaverse users where they already exist,” said Zipline cofounder and CEO Melissa Wong. This might be in a popular game or in a physical store where people mingle in the flesh. Just don’t expect to get much out of spending millions on the next deserted island. Too many times we see brands build experiences that are brand driven instead of creating them with the player in mind, and then they wonder why no one came.
Of course, gamers are at the core of all this new activity. They are already in tune with this new reality and are this brave new market. A study from Newzoo found that gamers had higher-than-average positive attitudes toward brand names than non-gamers. They surveyed 75,000 respondents online from 36 markets worldwide and found that gamers hold a significantly more favourable attitude toward brands in sports, cars, drinks and fashion.
Making It A Reality
Augmented Reality Shopping With Garment Visualization Simulation Technologies getty
Current shopping models are Physical-to-Physical, Digital-to-Physical, and Virtual-to-Virtual. But what about going the next step and making the sale from Virtual-to-Physical and Physical-to-Virtual? When your customers are in the Metaverse, it’s virtual first. However, what happens when they want to purchase something physical in-game or in-world? Or when they are at a physical location, whether a store or a music festival and something they acquire at the location can unlock something else for them in the virtual world? We will dive deeper into these models later in this essay and in future ones.
In the Metaverse, there is an emerging business model focused on providing new products to digital twins of the customer, which would be the person’s unique avatar. This is called Direct-to-Avatar (D2A), a term that Ryan Gill, CEO of Crucible, and I first explored back in July 2020 in a highly cited article. D2A bypasses traditional marketing by focusing on in-game personas to sell virtual goods, physical items, or real-world experiences. D2A may sound counterintuitive, but it is becoming a fast-growing market segment with an increased sense of connection to purchase digital goods that may or may not come with real-world counterparts. D2A can be leveraged by brands to sell V2V, P2V, and V2P.
With D2A becoming a new model for D2C, this in itself signals a new frontier for B2B and B2C paradigms which will be impacted not only by gaming but also by AR and voice.
Discerning The Metaverse Through “Metaverse Moments”
Culture is being created in virtual spaces. getty
While the Metaverse may not be fully understood by many business professionals marketers, and communicators, many believe and agree that it is part of the future. Some companies are advancing into Metaverse markets, while others are stumbling into them. Separating impactful, meaningful activations from publicity stunts and teasing the real value of the Metaverse out of the hype can allow businesses to make rational decisions at this crucial state of the opportunities that are emerging. At the end of the day, what is the value you are creating for your community or your fans?
Right now, there is no universally agreed-upon definition of the Metaverse. While there are a few common criteria, most people have their own ideas about what the Metaverse is, or will be. And that’s okay. But, for the sake of common understanding, the Metaverse in this article does refer to a further convergence of our physical and digital lives.
As our current societies and economies are populated and shaped by individuals; the Metaverse is populated and shaped by our digital lifestyles. It’s about digital identity and ownership feeding, and being fed, by a new extension of human creativity. Additionally, culture is being created in virtual spaces, and that culture, in turn, impacts fashion, entertainment, and more.
The digital lifestyle isn’t new-we’ve been living it on phones, tablets, computers, increasingly in VR headsets and soon in AR glasses and other emerging display systems that bring our digital lives up to our physical lives. So, to what extent do we live party in the early glimpses of the Metaverse already?
The Metaverse that many imagine is still a long way off. But, the Metaverse isn’t (just) a virtual place at which we will someday arrive and will include our physical world. It’s an evolution. The Metaverse reveals itself more and more everyday in glimpses – “metaverse moments.”
While it’s important not to confuse these metaverse moments for the actual arrival of the Metaverse, we can learn from them about what the Metaverse will look like, and how we can build it, and build in it, successfully.
Pure Virtual Markets
Gaming economies have been thriving for decades. getty
Commerce is evolving into more virtual spaces and experiences, including experiences shared virtually through augmented reality. The world of the previous century was driven by physical-to-physical commerce – economic activity in the physical world buying experiences and items in the physical world. The Metaverse is driven by virtual-to-physical, physical-to-virtual and virtual-to-virtual commerce.
Virtual-to-virtual commerce has been happening in games for decades. This kind of commerce involves online economic activity buying online experiences and items. We can also call this the “direct-to-avatar” model – similar to today’s “direct-to-consumer” model but emphasizing that the “consumption” is taking place virtually.
According to Statista, in-game purchases alone accounted for over $61 million in 2021, with the total virtual goods market expected to reach nearly $200 billion or more by 2025. That’s possible, especially considering other kinds of virtual-enabled commerce, which is also growing in scale through app and hardware adoption. This is presenting huge opportunities for companies exploring these concepts – particularly at this early stage of the market.
V2P And P2V
There are activations and economies in the Metaverse beyond the virtual-to-virtual model. These are virtual-to-physical and physical-to-virtual.
Virtual-to-Physical activations involve purchasing a virtual good or making a purchase within a virtual-first marketplace or a gaming experience that may have some virtual benefit but that also allows some kind of physical product or experience. Physical-to-Virtual markets involve purchasing a physical item or experience that also “unlocks” some virtual component.
Some Virtual-to-Physical commerce activations are relatively simple, like making purchases through an AR or fully-virtual storefront. There are dedicated companies making bespoke virtual marketplaces that integrate directly with a retailer’s existing 2D eCommerce solution.
Many online retailers have also seen success creating immersive shopping experiences through applications like Snapchat. Parent company, Snap Inc., has been making eCommerce through the platform easier and more enjoyable for users as well as more efficient for retailers for a while now. And that’s just in time since a recent study found that over 90% of Gen-Z want to use AR for shopping.
NFTs Could Play A Role
While both of these examples are exciting, it is true that they are versions of how some eCommerce already happens. Nevertheless, there are more technologically advanced options with even more potential to reinvent business models and present new ones. Consider those that involve the purchase of non-fungible tokens.
NFTs represent and allow ownership of digital goods. But, through the magic of blockchain, they also allow the minter of the NFT to grant exclusive boons to the holder. Consider a restaurant that hasn’t opened yet but sells NFTs allowing exclusive access to owners when the restaurant does open. If done properly it becomes a new way for start-ups to generate capital, for example Fly Fish Restaurant which opens in 2023 in New York.
Some might think that the use of an NFT in this way is gambling. (In the example above, will buyers get enough use out of the restaurant to make up for their initial purchase? Will the restaurant ever actually open at all?) However, it’s more appropriate to think of this kind of use of NFTs as “crowdsourced corporations” earning start-up money in much the same way that a new corporation would make money by selling stocks.
Just like a corporation selling stocks, a startup selling NFTs can grant holders exclusive benefits including helping to make decisions about how the project is run. This can go as far as “decentralized autonomous organizations” that are run completely by the people that run the digital infrastructure supporting a project. But, that’s a conversation for another day.
First, we need to look at some forward-thinking companies that are making major strides in using the NFT option as the marketing hook. London-based, Auroboros, which was recently featured in a Netflix documentary, for example, is a Metaverse native luxury fashion house that is creating for both the physical and digital markets.
Highly successful, the founders seek to embrace the art and fashion worlds merging them into the Metaverse. They are being aided in this task by using Boson Protocol which is a decentralized Web3 marketplace that allows a marketer to sell physical products in the Metaverse as NFTs. Future commerce will run seamlessly with the company promoting its products while having direct access to its data to determine future sales.
Some consider Boson Protocol a new form of “banking” platform by eliminating intermediaries expediting sales, a belief recently supported with its partnership with MasterCard. Its appeal is far-reaching with Tommy Hilfiger, Hogan, Cider, IKKS, Anrealage, Deadfellaz, SSIAN and others partnering with Boson.
It isn’t stopping here. Last year, Balenciaga partnered with Fortnite, the world’s most popular video game, to promote the fashion company’s high-end fashion. Albeit an interesting match for a high-priced fashion company to team up with a game that teens and young adults prefer, it is certainly the beginning of partnerships that may eventually increase brand recognition and eventual sales for brands. Time will tell but companies are eagerly exploring these possibilities.
Enter Physical-To-Virtual
There is also a lot of work being done in activating physical items or experience purchases to enable virtual benefits. These transactions are simpler for people that aren’t (yet) into crypto and NFTs, and it gives them the comfort of having a physical item or experience regardless of whether the virtual benefit materializes – or even in the event that they choose not to interact with the virtual component at all.
One example from last year’s holiday season came from toy company MGA Entertainment teaming up with Ioconic to create NFTs and virtual experiences that were launched from QR codes in the packaging of the L.O.L Surprise! toy line. This was in keeping with the spirit and business model of the line, which already involved collectability. It also added fun new components without replacing the existing model.
This example was relatively limited in terms of scale – only select retailers were involved and not all purchases from within those retailers included the QR code to the experience. Some of this is because blockchain and NFT activations can still be relatively expensive – particularly at scale. It’s also because companies are still learning how these emerging technologies fit into the customer journey.
Regardless of these concerns, the companies that are using brand activations are creating sensations wherever they play out. The result is greater brand awareness, more positive impressions and more customers which equals more sales. According to product>lead,a brand activation strategy marketer, companies are finding great results with their brand activation efforts, such as Revolve using an annual festival to combine experiential and influencer marketing tactics driving 70 percent of its annual sales, or Top Line makeup developing a Shop Your Mood interactive feature to increase conversion rates without damaging their reputation, or even Samsung encouraging users to use Samsung Galaxy s9 smartphone to take photos in any condition using the #reimaginemuseum hashtag.
The Wave Of The Future Is Coming To Shore
Metaverse online shopping experience in virtual reality environment. Young woman shopping in … [+]getty
The time has come for business professionals to recognize that they have two options: they can stay entrenched in the traditional paradigms and strategies of consumer purchasing, shopper marketing, and customer experience or they can fully embrace new user journeys in the virtual spaces and in turn the Metaverse. Change and evolution in customer behaviours are not going away and will be further impacted by Gen-Alpha’s reality which further blurs the physical and virtual divide.
While there is still no perfect roadmap for marketing in the Metaverse, there are now sufficient examples of initiatives from which we can learn to help us move forward. Through a holistic strategy that has clear goals and that is flexible change you can eventually build the confidence to put your toe in the water so to speak. No one is suggesting that you go full-blown into the abyss. Taking measured steps is the realistic way to start. With each of your own successes, you will be able to close the gap between the physical world and the virtual world. When you do, you will be amazed at the results.
In the next article in this series, we will dive deep into the Virtual-to-Physical commerce model. This will include its current state, what a current customer journey looks at all the stages of the commerce model from pre-purchase to post-purchase, as well explore the impact of player actions, touchpoints, pain points, solutions, and challenges.
Cathy Hackl is a globally recognized Metaverse / Web 3 authority, strategist and tech futurist. She’s a business executive, keynote speaker and one of the most influential women in tech and is considered a leading management thinker by Thinkers50. She founded the Futures Intelligence Group, which was acquired by Journey, a new design and innovation consultancy. At Journey she leads the Metaverse Studio. Hackl has worked for some of the biggest names in tech including Amazon Web Services, Magic Leap & HTC VIVE.
The market size of the metaverse could reach $5 trillion in value by 2030. according to a new report from international consulting firm McKinsey & Company.
Based on this projection, McKinsey indicates that the consumer spending in the metaverse will most likely be divided into five fields: socializing, gaming, fitness, commerce and remote learning.
E-commerce will be the primary cash generator in the metaverse, McKinsey predicted that consumer spending in this sector could reach $2 trillion to $2.6 trillion of by 2030. Virtual advertising will be another major sector, with relevant revenue expected to make up another $144 billion to $206 billion.
Gathering survey from 3,104 consumers across 11 countries, McKinsey said that early 60% of all consumers surveyed prefer at least one activity in the virtual world compared to its physical alternative.
Among those consumers that are currently active in the metaverse, 79% of consumers have already purchased virtual goods in the metaverse. 78% of consumer have already attended virtual social events or playing social games.
The report also highlighted that companies, venture capital, and private equity firms have invested more than $120 billion in the metaverse in the first five month of 2022, which is more than double the $57 billion invested in all of last year.
The report also showed that 25% of all executives on survey said they expect the metaverse to drive 15% of their organization’s total margin growth in five years.
Metaverse is a technology term originally from the 1992 cyberpunk novel Snow Crash by science fiction author Neal Stephenson. The term describes an all-encompassing virtual world where people can play, socialize and interact with one another by using avatars.
The idea behind it is that people can walk around and inside of virtual world where they can interact with one another in real time.
The metaverse is the convergence of lots of technologies and express how they all interconnect.
As 5g and even 6g rolls out, it’ll increase internet speed, which could enable a seamless link between our real world and the metaverse. Software, device makers, tool builders like game engine companies will benefit from Metaverse going forward. These companies are typically fast followers on the latest trends as they raised large chuck of company from venture capitals and big tech companies.
The Metaverse is a platform that sounds like a sci-fi concept, but shockingly, it’s as real as the internet. However, this technology is new. Before it becomes the new normal, there are plenty of improvements, trends, and modifications it will go through. With time as everything is changing, the way we entertain ourselves, shop, watch movies, or hang out with friends is also changing. Technologies such as Metaverse help us in getting rid of the long-distance and be with people in real-time, even if in a virtual world. In a way, Metaverse is not only about comfort or entertainment, but it is also a decent technology that can bring two people living far from each other together.
Now, Metaverse is supported by plenty of technologies with different roles. In this blog, we are discussing the top 5 key technologies that are the driving force behind the functioning of Metaverse.
Currently, five technologies power the Metaverse
Artificial intelligence (AI)
AI is one of the most important technologies in the Metaverse. There are many roles that this technology has to play to maintain the efficiency of the Metaverse technology. AI is used to monitor servers for improved cybersecurity continuously, and the technology is also used for smarter responses. AI in Metaverse is monitoring servers to make it a safe space against bullying or harassment of any kind. Some examples are –
Massive scalability
Decentralization
Infrastructure support
Interactive UI
Improved accessibility
Cybersecurity
Smarter translations
Smart contracts
Realistic avatars
Unscripted NPC storylines
Augmented reality (AR) and Virtual Reality (VR)
AR and VR are technologies that empower the major features of Metaverse. It is all about creating a virtual interactive experience, users can onboard its servers with the help of VR glasses. These VR glasses can be paired with any smart device including a smartphone, tablet, or computer.
Users can explore Metaverse to shop from businesses that have already onboarded the space, hang out with friends, explore stories, play games, and more. AR, on the other hand, can create a fusion between virtual objects and real environments with the help of a device camera and users can access the AR features of Metaverse on their screens. For gaming, learning, entertainment, etc, AR/VR technology features can create endless possibilities.
Internet of Things (IoT)
Metaverse is a technology that uses wireless on a large scale. Thus, smarter IoT sensors play a crucial role in enabling the technology. IoT sensors are used to pair up devices like VR headsets, haptic gloves, speakers, voice recognition, etc. Now, there are other possibilities as well. Take gaming for example – it supports gaming and allows players to use devices like Oculus headsets. IoT is also capable of enabling realistic responses to interactions done in the Metaverse. With haptic gloves, every time users interact with a virtual object, IoT sensors transform these interactions into data and with haptic gloves, users will be able to feel these virtual objects. IoT and AI play major roles in enabling such possibilities of Metaverse and IoT.
Blockchain
Metaverse supports the usage of NFTs, Smart Contracts, and Cryptos. Additionally, it is supposed to handle a massive amount of data, concerns such as security, scalability, speed, and transparency are natural. Blockchain, however, is the solution technology that helps Metaverse in protecting and decentralizing the data. Blockchain can be used to store in-game assets, smart contracts, virtual real estate, NFTs, etc. Other features like control over data shared, transparency over data modifications, etc are possible only with Blockchain. Blockchain can also help Metaverse developers in tracing sources of any event that either makes servers vulnerable or unsafe for its users. To investigate any events, blockchain traceability is undoubtedly the best weapon Metaverse has.
Edge computing
Faster data transmission is the requirement of Metaverse that its tech infrastructure will have to fulfil. Edge computing is the technology that takes care of the faster data transmission requirement in modern businesses all over the world. Distributed Computing, a newer version of edge computing enables users to enjoy edge computing features without having to set up an entire hardware infrastructure. For common users, distributed computing is going to play a big role in delivering features to them.
Key Takeaways
Well, these were the crucial technologies that are majorly contributing to making Metaverse a reality. With the endless possibilities that Metaverse has, plenty of businesses can foresee the demand for technology in the future. Thus, brands are also enthusiastic about purchasing virtual real estate on Metaverse servers to establish virtual showrooms. There are plenty of Virtual Reality and Augmented Reality app development experts interested in this technology, thus, it will not be shocking if the technology influences the way we use our smartphones today.
In the end, hopefully, you found this blog useful. We keep publishing such informative blogs regularly, so do not forget to open and explore the website for some more amazing reads.
Feature Image Credit: Metaverse city and cyberpunk concept, 3d render
Is your brand ready for the metaverse? It can be a complex question — for one thing; the answer depends on what “the metaverse” refers to for you as a business owner. For another, it can depend on the type of business that you run. But, ultimately, brand owners want their companies to be ready for anything — and active growth is often top on the list.
What Is The Metaverse?
The answer to this question depends on who you ask, but a simple definition is “a collection of technologies that allows us to interact in a virtual universe.” Most commonly, those technologies involve augmented or virtual reality and video.
Technically, our ability to interact with AI or with avatar representations of others on social media is an offshoot of what the metaverse is intended to be. The function of the metaverse is to meld the physical and the virtual into one.
As technology advances, experts and innovators predict that we’ll spend more time in this digital universe than we do now — and maybe more time in our virtual world than we do in the real one. With the heightened focus on digital communications and ecommerce during the past two years, this doesn’t come as a surprise. Statistics already show the rise in interest — in 2020, almost 84 million people were using AR/VR regularly in the United States alone, with that number projected to rise to 110 million next year.
There’s endless scope for the imagination with the metaverse concept — not to mention endless scope for business growth. Big companies like Microsoft and Epic have already invested in the metaverse, aiming to stake a claim on their virtual brand. As a result, the market for augmented reality, virtual reality, and mixed reality are projected to reach 300 billion dollars yearly by 2024.
There’s no doubt about it — the metaverse is the next significant shift in the digital world, and it’s best to be ready to take advantage of it!
Here are the top three ways to build your business brand in the new digital movement known as the metaverse.
Unified Branding
Branding is always one of the top keys to building a business. Branding not only identifies who your company is but connects it with core values, products and services on offer, and even your audience.
“Just make sure you have a brand” isn’t really the best advice, though, because inconsistent branding can actually be detrimental to your overall brand. Inconsistency can cost — 90% of consumers expect to have a consistent experience with a brand regardless of the platform, and consistent brands are more likely to have strong visibility, whereas if consumers are less aware of a brand and have less of an impression of it as a whole, they’re less likely to notice the company — and therefore less likely to engage or invest. Neglecting your colour scheme or making a logo design mistake can have serious consequences.
Along with consistency, specific elements can help with solid branding. For example, using a signature colour can boost a brand’s recognizability by up to 80%. That means that customers would be 80% more likely to recognize and interact with your brand in the metaverse if they see your signature colour.
Leitmotifs, or sonic branding, are also valuable to a complete branding package. Some statistics suggest that using audio — think jingles or recurring notes, like with MacDonald’s ba-da-ba-ba-ba — as part of your branding can increase recognition by up to 46%.
In the end, the numbers show the importance of keeping your branding steady as you move into the metaverse with your brand. Unified branding across all platforms, including print, storefront, social media, and website, has been shown to increase revenue by up to 23%. That’s significant growth, especially for a small business.
Virtual Experiences
The metaverse is all about virtual reality, and adding virtual experiences into what you offer your customers is an excellent way to get them ready for the metaverse even now. In addition, you may be able to leverage the rising sales of VR headsets, which is one of the most popular ways to explore the metaverse concept. From just under five million sets sold in the US in 2020, sales are projected to reach more than 14 million yearly in the US by 2024.
But VR headsets aren’t the only way to craft a virtual experience to share with your customers and attract them to your business. Build a digital storefront that mimics your brick-and-mortar store. Create digital tours of your products. Ikea is an excellent big-name pioneer of this, already demonstrating how to use the metaverse concept to grow a particular aspect of a brand. With virtual room design, Ikea customers can see what furniture and features will fit, how the colour scheme will turn out, and how frustrated they may get while figuring out how to put it all together.
Okay, that last part isn’t actually a feature of Ikea’s virtual experience. But it’s only a matter of time.
Video Production
A final and significant way to build your business brand in the metaverse is to incorporate videos in your marketing, website, and social media posts.
The importance of video isn’t anything new. Approximately 85% of marketers already leverage video use as an essential part of their strategy, with 92% of that number labelling it as essential to their work going forward. Video nets the most engagement on social media, especially Instagram. More than 90% of businesses point to social media videos as a key that has garnered new customers and directly caused conversion.
But with the metaverse being focused on virtual/augmented reality and video, video production is even more of a recommendation for brands that are looking to grow. Not just for marketing purposes, either — other popular kinds of videos include how-to or explainer videos and social media videos, both of which puts the focus on entertainment and education.
The more value you can provide, the more likely you will attract new interest. And with new interest, your brand is sure to grow.
To the Metaverse and Beyond
It’s challenging to get a consensus on just what the metaverse means and how far it will take us. But one thing is for sure — we’ve been spending more time in the virtual world than ever in the past few years, and it’s almost guaranteed that the trend will continue.
With essential brand-building methods, your brand will be ready to grow in the metaverse and whatever comes next.
Over the past year, the metaverse has grown from buzzword du jour to buzzword de l’année. Tech companies, game developers and brands alike are racing to claim a corner of the virtual world to come.
But though the metaverse hype continues to rise — in marketing departments, at least — brands interested in activating virtually should take precautions not to overwhelm potential customers. Multiple sectors such as gaming, social media and blockchain tech are currently competing to become the builders of the metaverse, leaving consumers scrambling to stay up-to-date with the latest jargon and technological developments. If brands put the virtual cart before the horse, they could risk burning their audiences out on the metaverse before it is able to fully take shape.
To get a better sense of how regular consumers are approaching the metaverse, Digiday has pulled key insights from five data reports and surveys regarding consumer sentiments and activity in the space.
Most people still don’t know what the metaverse is
A January survey by market research firm Ipsos revealed that 38 percent of Americans state that they are very or somewhat familiar with the metaverse — though this figure varies drastically depending on consumers’ age and the presence of children in their households. Over 50 percent of respondents from households containing children were familiar with the metaverse, while only 20 percent of respondents aged 55 or older said they knew the term.
As shown by the chart above, the respondents who claimed to know about the metaverse differed greatly in their explanations of what exactly it was, with some associating the term with social media and others with virtual worlds. As brands continue to activate within metaverse platforms, it could be wise for them to use these activations to educate consumers rather than assuming they have prior knowledge of the metaverse.
Most brands don’t know about the metaverse, either
If consumers are still unsure about the metaverse, some brands might be even more cautious about dipping their toes into the virtual water. A December survey by social analytics company ListenFirst revealed that only 18 percent of brand marketing and analytics executives stated that they understood the metaverse and how it would impact their brand, as reported by MediaPost. That said, this figure could increase as metaverse activations become more mainstream, as 49.5 percent of survey respondents said they “somewhat” understood the metaverse.
Regardless, this data shows that, despite the presence of flashy activations such as the VR-powered AT&T Station, not all brands are ready to follow these big names into the metaverse, given the relatively untested nature of metaverse platforms and the lack of clarity about exactly what a more fully realized metaverse might look like.
People are willing to spend money in the metaverse
While only some consumers are familiar with the metaverse, those who are comfortable operating in virtual spaces find virtual commerce to be an appealing prospect. A quarter of consumers have shopped online in a three-dimensional virtual store, per a January study by the experiential e-commerce platform Obsess. Among that cohort, virtual commerce activity was highest among millennials, with 77 percent of millennial respondents saying they had made a purchase in a virtual store.
It’s worth noting that the language around virtual commerce has not caught up with the metaverse concept. Though commerce in a three-dimensional virtual environment certainly fits into most definitions of the metaverse, only 38 percent of respondents said they would like to be able to shop in the metaverse.
Gamers are the first residents of the metaverse
Using data from its November 2021 Consumer Energy Index and Retail Pulse Survey, research company Forrester divided online adult consumers in the United States and United Kingdom into four segments: digital immersives, digital socialites, digital commoners and the digitally disconnected.
The first two groups, comprising 47 percent of all online adult consumers, are the ones best accustomed to immersive experiences and multiplayer online games, per Forrester’s recent State of the Metaverse report — and it’s the 22 percent that is digitally immersed that is most likely to adapt to the metaverse early on. 49 percent of this cohort — 11 percent of respondents overall — uses a virtual reality headset often, one indicator that Meta’s VR-focused vision for the metaverse could line up with future consumption habits.
Gamers are accustomed to virtual spaces, but still wary of web3 technologies
Companies from the Web3 and gaming sectors are vying to become the builders of the metaverse, with some game developers combining the two to create play-to-earn games that hinge on blockchain and NFT technologies. But the majority of gamers are uncomfortable with the presence of NFTs in games — 69 percent, according to a March survey by online community platform FandomSpot. Of the 69 percent of respondents who stated they hated NFTs, only 12 percent said they fully knew what NFTs were, so sentiments are likely to change as knowledge of these technologies becomes more widespread.
At the moment, though, it is undeniable that many gamers have reacted with vehement negativity whenever large game developers such as Ubisoft have indicated an interest in NFTs. Given the wrathful sentiment surrounding NFTs in the gaming space, brands interested in getting involved in virtual space might be able to avoid bad press by leaning into the gaming origins of the metaverse rather than its web3 potential.
