Management Perspectives

Metaverse may be one of the buzz words of 2022 so far, bit it fair to say there are still many sceptics in the business world. It was described by Mark Zuckerberg as the “embodied internet” where users can enjoy watching movies, travelling, meeting friends, and shopping via VR and AR headsets or other devices.

Elon Musk, in contrast, says he doesn’t “get it,” but he is also the founder of Neuralink—a neurotechnology company developing implantable brain – machine interfaces, which, he believes, will be far more efficient to put users into virtual reality.

Whether you love or hate the idea, it is hard to ignore that we may be in a very seminal phase, at a new frontier. There is still a limited group of first movers experimenting to really understand it, and it could be the perfect moment for companies to start testing it in terms of marketing and customer experience.

But are the people there to market to? Well, in 2019, 10.7 million people attended Marshmello’s Fortnite concert, which, at the time, felt huge. Just a year later, Travis Scott’s Fortnite event reached 45.8 million people, while the amount of VR and AR users keeps steadily growing too.

Where is the metaverse?
The metaverse has actually been around for quite a while now, especially in gaming. Names you will probably have heard are those of Roblox, Fortnite, Minecraft, Animal Crossing and VR Chat. And of course some big tech companies like Meta and Microsoft are heavily investing in this area as well.

However, it is perhaps the decentralised metaverses like The Sandbox and Decentraland are where it gets really interesting, as they run on the blockchain and are thus also part of the Web3 phenomenon.

For those who are not familiar with Web3, it is an idea for a new version of the World Wide Web based on the blockchain. It shifts data ownership back to the users and thus offers a lot more data privacy and security, as well as lessening the power of the big tech giants. The metaverse and Web3 are by no means synonyms, but some metaverse platforms— the decentralised ones—are a part of Web3.

Metaverse marketing
So how can brands profit from the opportunities of the metaverse today? Should we already be experimenting with ways that it can benefit our brand, customer experience, and maybe even make a profit from it?

Like with any marketing endeavour, it is important to draw up a strategy with clear objectives first, but here are a few ideas for how it might work.

Advertising
Using old school methods in a new environment might not be the most exciting opportunity, but it does allow brands to reach a pretty massive audience at a more affordable price than some traditional channels.

In 2021 Dimension Studio—creators of virtual worlds and humans for the metaverse— earned $6.5 million in revenue from making metaverse technology for fashion brands alone. Coca-Cola, Samsung, and Volkswagen have invested in virtual billboards within video games like Football Manager and Hyper Scape, while Roblox also began experimenting with interactive ads. Nas also used in-game audio ads to promote his album King’s Disease II, and saw a 1.275 per cent click-through rate.

Virtual influencers
Using influencers has perhaps already become a slightly old school marketing approach, but it is already crossing over into the metaverse. Daisy, for instance, is a virtual influencer created for online luxury discount site Yoox. She was featured in multi-brand campaigns, wearing clothes by Calvin Klein and Tommy Hilfiger. Other brands have a slightly different approach, using avatars modelled on real people. Dior created a digital doppelganger of the Chinese actress Angelababy to attend its show in Shanghai, while digital doubles of supermodels Naomi Campbell and Kendall Jenner starred in Burberry’s collections.

Advergames
With this technique games are used as a means of advertising products or services. So, the brands do not advertise in the games of other parties, but they design their very own games.
Tourism New Zealand, for instance, launched PLAY NZ, a 3D world-style adventure gaming experience to let people explore the country’s greatest attractions in a completely new way. Luxury brand Balenciaga introduced video game Afterworld: The Age of Tomorrow, while Louis Vuitton has Louis The Game, a game that combines its heritage, innovation, and NFT art.

Virtual venues
Brands like Warner Bros., Hyundai, Adidas, and Gucci are effectively claiming virtual real estate in the metaverse with their own virtual venues. DBS bank recreated Singapore’s iconic Zouk night club in Fortnite, renaming it the Live Fresh Club to advertise its credit card of the same name.

Hyundai Motors launched five theme parks on Roblox to introduce younger consumers to Hyundai’s products and future mobility solutions, while Vans launched a virtual skate park that lets players try new tricks.

Virtual events
The entertainment industry is already embracing this approach, and we have already seen attendance figures for virtual concerts run on Fortnite or Roblox that are much higher than in real life.

But businesses are also starting to understand the value of virtual events in their customer experience. Lindsey McInerney, Global Technology and Innovation Director at Anheuser-Busch InBev believes that ‘The future of sports, media, and entertainment is virtual. Almost 2.5 billion people are already participating in the virtual economy. This is the direction of the world’s evolution’.

Metaverse commerce
Perhaps the most interesting opportunity in marketing and CX in the metaverse sometimes called the direct-to-avatar (D2A) economy, where brands are starting to sell digital goods inside the metaverse. Of course, in-game commerce has been around for years already, and is even projected to evolve to $74.4 billion by 2025. More recently, however,corporate brands such as Clinique, Tencent, Anheuser-Busch, and Gucci have made moves in metaverse environments.

A big part of this is the non-fungible token (NFT) market that is turning virtual goods into unique content or collectibles using a smart contract. In the Metaverse, these NFTs enable virtual ownership of an asset. Visitors of the Gucci Garden virtual store can purchase exclusive, limited-edition avatar items, such as a digital bag on Roblox for $4,000. Coca Cola launched virtual wearable NFTs, while Samsung gave away rare avatar clothing such as jackets, helmets and shoes as NFTs.

But it is not just about NFTs. Brands are also selling ‘regular’ virtual products in the metaverse. Balenciaga has partnered with Fortnite to design virtual outfits, accessories, and weapons that players can purchase for their avatars. The Gucci Virtual 25—a digital pair of sneakers—can be bought for between $9 and $12 to be worn in augmented reality or used in partnered apps like Roblox and VRChat—so maybe it is time to think if your product could be converted for the metaverse?