The world may have forgotten the first ever Oculus Rift announcement back in 2012. However, the undying passion of gamers for virtual reality headset has never dwindled. Arguably this ignition into harnessing virtual/augmented reality technology possibly originated from the hit manga/anime series, Sword Art Online (SAO), created by Reki Kawahara. Based on adventures in various virtual reality MMORPG’s, SAO was a widespread commercial success. In roughly 10 years since, technology has progressed to establishing a shared virtual space, albeit not to the extent seen in SAO.
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The metaverse
The metaverse is an ever-evolving shared virtual space. Where users, represented by their distinct avatars can access these immersive environments to connect and interact in a manner similar to the real world. A kid’s game is not something you would associate the metaverse with, for it enables the buying and selling of virtual goods. The metaverse, or some may liken it to a mirror world, continues to evolve with each user interaction within its space.
Which begs the question, what exactly defines the metaverse? We realise it’s more than just a game where you log in and do whatever you want, it’s a space much similar to reality. So, what exactly are the traits that define the metaverse as such?
Always Active
The virtual space exists at any time and place. This enables users/everyone to log in simultaneously. Unlike a saved game file, which loads at the point of save, the metaverse does not halt for anyone.
Synchronicity
Replicating the state of the real world, users interact with each other and the digital world in real time.
Interoperability
The functionality of a cross platform allows virtual items to operate in any environment. Users are thus able to use these virtual items across the various different experiences on the Metaverse.
Economy
There is a virtual world economy in which users and businesses can exchange goods and services for monetary value. Unlike typical in-game transactions with only one universal source of currency, the metaverse allows for the exchange of non-fungible tokens as well as crypto currency. Using yet another game mechanism, the metaverse also recognizes and rewards users for their accomplishments within the worlds.
User generated content
The independent universes within the metaverse serves as a conducive environment for open world exploration and activities. More than just a place to hang out, users can participate in the various activities within the world. Alternatively, they can also create content for others to enjoy.
Metaverse Marketing
The qualities of the metaverse may appear to be similar to that of social media. But marketing in the metaverse brings with it new experiences based on tried-and-true age-old notions.
Branded characters in games
Brand collaborations with your favourite games might be as far as a star from another galaxy in the past. However the metaverse has managed to make that happen. Brands have naturally recreated the experience or built branded characters within games. Animal Crossing: New Horizons and Fortnite are two popular gaming titles that have gained popularity in recent years.
Animal Crossings: New Horizons
The everlasting joy of any Nintendo game is its universal appeal to all age groups and languages. Animal Crossing takes it a step further by featuring family-friendly ratings, simple controls, and a laid-back gaming style. The game’s premise, along with multiplayer capabilities, has made it a fertile placement that brands seek.
Placements are not limited to specific industries; take for instance tourism. An innovative placement occurred when Singapore’s Sentosa Development Corporation replicated Sentosa Island. Therafter, encouraging players to tour its famed attractions amidst suffering from cabin fever at home. Moving on to the food and beverage sector, KFC’s virtual restaurant is now open in the Philippines. The restaurant is decked out in its distinctive red and white colour combination, complete with booths, menus, and o’ glorious chicken. Users who uncover the elusive Colonel Sanders in game-ception will be given a special ticket to receive a complimentary eight-piece supper in real life.
Fortnite
The hit online multiplayer game has seen its fair share of brand collaborations. Unlike the relaxing and convenient nature of Animal Crossing, Fortnite’s competitive streak proves to be a deterrent for some brands. Brands that do have placements however, are riding on its competitiveness.
Any Marvel fan in 2019 would not let you forget the spectacular end to phase 3 of Marvel’s cinematic universe with Avengers: Endgame. Bringing the experience in-game, Disney and Fortnite launched a limited edition game mode. The mode Avengers allows players to fight either as the heroes or villains (aka Thanos) to collect the infinity stones.
Meanwhile, fast-food chain Wendy’s insertion into the game has sent players into a frenzy. After noticing that the in-game Durr Burger restaurant stored virtual beef in freezers, players played as a character resembling Wendy’s mascot to ‘kill’ all freezers in game. As part of Wendy’s ‘Fresh, never frozen beef’ campaign, the game mode had explosive results.
In these cases, brands have naturally integrated the brand experience without disturbing the games’ inherent flow or atmospheres.
Digital goods for avatars
While in the confines of the metaverse, users are present through the medium of a virtual body, capable of customisation. Thus, providing an opportunity for many brands especially those in the fashion industry. Specifically, virtual apparel brands are targeting young millennials and Gen Z’s the present users due to their beliefs of self expression through clothing. Their ideas on consumption differ in which they would rather have access to unique virtual opportunities than physical possession. This contrasting difference could have resulted by their influence in values of sustainability and authenticity.
Direct-to-Avatar Economy
Direct-to-avatar (D2A) is thus becoming the current strategy for brands. The reproduction of any physical good into virtual forms cuts a huge carbon footprint, a key consideration for metaverse consumers. At the forefront of the D2A market lies fashion brands like Ralph Lauren with their 50 piece virtual collection or the Gucci x Northface collection for Pokemon Go. Pioneer brands like Marc Jacobs, Sandy Liang and Valentino have also opted for a virtual zero waste approach, opting for virtual fashion shows instead. Solely digital brands have also emerged, dedicating themselves to selling just digital fashion. Tribute Brand, launched in 2020, is one of them. Sporting highend fashion pieces, Tribute Brand prides themselves as pioneers for fashion that is genderless, sizeless that does not require physical shipment and production.
Roblox is unquestionably an important stakeholder in the D2A sector. With 50 million active users every day, the online gaming platform is the best bridge marketers may have to their younger demographic. Over half of the Roblox population is over the age of 13, and they have spent countless hours playing the game. Reportedly, over 25 million virtual items were created by the community with one in five active users continuing to update their avatars with both free and paid goods.
Collectables
People collect items for a variety of reasons, including enjoyment, status, and perhaps a force of habit. The metaverse is no exception. with the existence of a D2A market, limited edition virtual items or simply any digital asset will be coveted and collected.
Take for instance the Gucci Garden experience on Roblox. The limited two-week virtual event immerses visitors in Gucci’s top 15 advertising campaign sets. However, the real treat(s) are the limited edition digital Gucci goods available for purchase during the event which can be worn by your avatar. Shockingly, the virtual Gucci Dionysus bag that was sold for 475 Robux (US$6-8) in game currency, was resold for over $1000 more than the physical bag. This is the epitome of scalping.
Non Fungible Tokens (NFTs)
Besides virtual items, the next great collectable goods are the NFTs (Non Fungible Token). NFTs are often image or graphic assets that can be used as avatars or even profile pictures within social media. What distinguishes NFTs is the security that underpins them. When you purchase an NFT, you essentially purchase a unique token on a blockchain ledger that serves as a proof of ownership. This distinguishes NFTs to the usual digital art as it’s ownership can be verified. Not to mention, the rise of NFTs allow independent artists to be credited for their work.
More importantly NFTs can be used across several platforms (it is called the metaverse after all) and can be readily bought or sold. From a commercial standpoint, it is also a branding opportunity. For example, the NBA Top Shot is a marketplace where fans can purchase, sell and trade NBA moments packaged into highlight clips. These NFTs operate much like trading cards, where each card contains a specific moment, such as Kevin Durant’s dunk in a game. Other brands like Coca-Cola are also changing up their brand experience with imaginative brand-inspired NFT collections.
Massive interactive live events (MILEs)
Massive interactive live events combine the social elements of entertainment and involvement. Many may be familiar with the live virtual concerts that were performed by Travis Scott and Marshmello in Fortnite. However, MILEs aren’t only for concerts; Genvid Technologies created Rival Peak, an interactive AI reality show with a survivor-like concept. The show’s direction and outcome was heavily influenced by viewers’ votes and assistance, with over 100 million minutes viewed by the end of its 12-week season. Demonstrating the potential for brands to use MILEs as a conduit outside of the music industry.
Uncertainties
While you may feel compelled to start marketing in the metaverse, the question is when and how to do it. Certain industries will, by definition, be more willing to experiment than others. The fashion and music industries for example, have embraced the technology and adopted the first mover mindset. Making waves and setting an example for other brands and industries to jump in.
While being the first mover may have significant public relations benefits, there are numerous other elements to consider.
Technology Requirements
The technology necessary for the metaverse’s core takes its toll in both hardware and software for both brands and participants. A strong and fast internet connection is required for a seamless experience in the metaverse. However, depending on the region, such technological possibilities may not be widely supported and, as a result, cannot be fully optimised. Furthermore, more complex technology, such as a premium VR headset, may be out of reach for the majority of consumers.
Data Privacy and Security
Digital solutions today are facing the same privacy and security challenges. The metaverse, on the other hand, extends these sets of concerns. Metaverse users will likely be staying online for long periods of time, where their behaviour patterns will constantly be monitored. In contrast to current systems, where monitoring appears at the point of interaction, such as a search or a click. In the metaverse, users will not be proactively providing personal data, but they will be monitored by their actions. Entailing a far greater amount of detailed data collection as compared to a simple search term.
Furthermore, the use of virtual reality headsets and glasses poses additional privacy concerns. VR devices are prime collection points for sensitive data. This includes eye and body patterns, physiological responses and even brainwave patterns. Although this may appear to be a far shot in 2022, the future is limitless. Data from such devices could one day be utilised to learn and comprehend user decisions and behaviour in order to target them.
Without a doubt, the seamless nature of the metaverse poses a great deal of data privacy concerns, ranging from compliance, data sharing, marketing consent, intellectual rights and regulatory laws.
Blurring the lines between Real and Virtual
The viral propagation of immersive virtual experience in the metaverse can lead to a blurring of boundaries between real and virtual worlds. What stems from an initial incessant staring of virtual screens may well lead to the inability to comprehend the passing of time. Addiction, in other words, is just one possible repercussion out of many; ranging from how people perceive real relationships and interaction; to full withdrawal from reality.
Other opportunities
Customer Service/ Experience
Putting marketing aside, customers can also stand to benefit in the metaverse. Brands can leverage on avatar manned stores to provide or recreate an even better immersive interactions between customers and the brand. 24/7 services for virtual/augmented product demos are just the tip of the iceberg.
Manpower & Training
The demand for metaverse related skills will inevitably rise. Granting opportunities that will necessitate the training of a new generation of employees; employees who will need to develop and create consumables and worlds within the metaverse. Rather than traditional office staff, the presence of a metaverse enables transnational remote work to take place at a low cost.
Furthermore, the metaverse can replace the need for physical training related equipment and infrastructure. Avatars can therefore take the place of physical instructors to conduct internal training workshops and new employee orientation. This will increase efficiency whilst reducing manpower.
Conclusion
The metaverse brings up new avenues of opportunity that may not be suitable for every business, but it never hurts to explore how it can benefit yours. In doing so, you should bear in mind that the fundamentals of the metaverse lies in connectivity. How will you engage with your customers, what are you going to offer and how much money are you willing to invest in the metaverse?
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