With brands and platforms plunging into the metaverse, leaders emerge from the gaming space
The metaverse industry is undeniably hot. Since the same period last year, Google searches for âmetaverse stocksâ have increased 17,900%. The good side of all this interest: innovation keeps coming. Last week, Facebook rebranded itself as Meta, becoming the latest company to signal its commitment to becoming a metaverse business. But it also led to lazy shots, spawned a cottage industry of opportunists, and sparked a reckless rush among the tech behemoths to try and make the concept their own. All of this gave rise to the downside to it all: that the Metaverse is a complex and messy landscape that is difficult and expensive to navigate.
Marketers know this more than most.
Indeed, the rise of the metaverse has led to an influx of businesses looking to recoup ad dollars from brands trying to get into the latest trend. It’s more important than ever for brands to identify which ones have been operating in virtual environments for more than a few hype cycles – and how to leverage their expertise to reach virtual consumers.
Games and social media are two pre-existing facets of culture and technology that may evolve into the first true metaverse. There is also a growing third faction: dedicated metaverse platforms such as Decentraland or Topia, which exist only to build and inhabit virtual worlds.
Gaming platforms are currently best equipped to help brands enter the metaverse, in large part because they have a pre-existing and loyal user base that is already accustomed to consuming in the virtual space, according to several experts. “Are these young adults really going to be excited about Facebook’s new metaverse business?” Said Jason Mitchell, CEO of social media agency Movement Strategy. âIf the metaverse was totally new and unique, maybe. But they’re already on Roblox and Fortnite.
There’s also the fact that Facebook, which recently fell victim to a litany of scandals, has amassed far less consumer goodwill than video game companies like Roblox and Epic. Many Gen-Zers just assume that Facebook’s metaverse will be a dystopia. âFor Facebook, they will be very careful to create metaverse experiences polluted, so to speak, by ads,â said Doron Nir, CEO of live streaming tool and service provider StreamElements. âBecause of the company’s heritage, it is more likely to forgo any ad revenue that can flow from it until it has a really large critical mass of users. “
On the flip side, brand partnerships – including those of the garish, in-your-face variety – are a regular and accepted occurrence in game-based metaverse platforms. Fortnite is known for showcasing skins and in-game items inspired by popular intellectual property such as Marvel and Star Wars, and Roblox has become increasingly involved in branded partnerships such as its âVans World,â a space permanent and personalized virtual dedicated to the popular clothing brand. This pre-existing framework of in-game ads could easily be adjusted to create âin the metaverseâ ads. âWe basically built what the stack should be to advertise in the metaverse,â said Samuel Huber, CEO of in-game advertising company Admix. âIf you think backwards and say to yourself, ‘Okay, what will brands need? Whether it’s the metaverse or the web, they need the ability to reach the right user at the right time and integrate the creations they’ve created and measure success. Well it’s basically a DSP [demand-side platform], but tailor-made for the metaverse.
The brand side
While brands would be wise to view Metaverse platforms with a savvy eye, Metaverse platforms should also take a close look at the brands they partner with. Not all products or services are suitable for virtual consumption; while it is all well and good for State Farm to have an office in Decentraland, it would be a challenge for the company to sell âvirtual insuranceâ to an informed consumer.
The persistence of his online identity on all platforms is a hallmark of the metaverse. As a result, the brands and products that consumers are most likely to purchase virtually are those that interact with the appearance or identity of users, according to Liam Osbourne, global customer partner at FLUX, the fashion brands department. and luxury digital marketing and advertising services company Media.Monks. âFashion has always been used as a building block of identity, so what you wear says something about you, as a person in the real world,â Osbourne said. âAs we see things getting more advanced digitally, it’s only natural that your avatar or virtual version of you is given the same level of importance and attention. “
This explains why fashion and beauty companies are leading the charge for non-endemic brands in the game in the metaverse. Global apparel companies such as Nike and Balenciaga, for example, have partnered with Epic Games to bring their virtualized products into Fortnite, the former hiring a dedicated virtual design team and filing of trademark applications for downloadable digital products with its swoosh logo. âWith virtual worlds being richer, you are allowed to experiment and play with makeup or clothing in ways that you couldn’t do – or afford to do – in the real world,â Osbourne said.
This doesn’t mean that only brands that care about how consumers look should be interested in going online. The rise of American consumer culture, which elevates its purchases and preferences as a marker of personal identity, aligns well with the advent of the metaverse. âIt certainly precedes ideas from the metaverse, or even the internet, but it has to do with the rise of lifestyle brands,â said Frank Rose, tech and storytelling expert and author of The sea in which we swim and The art of immersion. âAnd lifestyle brands can be almost anything; we think of them as, maybe, fancy alcohol or a clothing brand, but Harley Davidson is nothing more than a lifestyle brand.
As consumers feel more comfortable owning goods that exist independently of their avatars (vehicles, homes, etc.), they will also tie these purchases to their identity, thus giving the concept an inherent value. virtual property. The success of fashion and beauty companies in selling non-fungible tokens and other virtual goods provides a glimpse of what a larger virtual economy could look like.
Whether brands use the metaverse to sell virtual or physical goods, the very nature of advertising will change as people adapt to the virtual space. Roblox describes its brand partnerships as âshared experiencesâ rather than advertisements, noting that the interactivity of its digital environment turns the brand-consumer relationship into a two-way street. Once the inhabitants of the Metaverse are used to more interactive brand experiences, billboards in the physical world – and even traditional Internet banner ads – might start to look flat in comparison. âOur team is specifically targeting who will be this brand that the public really wants to engage with,â said Christina Wootton, vice president of brand partnerships at Roblox. “They are really excited about it, it improves their experience on the platform.”
Until consumers fully understand the idea of ââvirtual property, brands of all kinds can add value to their digital products by pairing them with physical goods. Roblox’s âVans Worldâ, for example, offers a range of digital items, such as skateboards and t-shirts, identical to those sold in physical Vans stores. âIt’s actually a one-for-one platform, the same platform, the same experience,â said Nick Street, vice president of global integrated marketing at Vans. “You can actually order this shoe in real life, and you can put your own design in it.”
The Vans World in-game store and the Vans online store are currently separate; Roblox is a COPPA-compliant platform, so it is impossible for users to navigate outside of the game by clicking on an in-game object. But the combination of virtual goods and physical goods is part of the roadmap. of most, if not all metaverse platforms: for example, the worlds of Stageverse, the concert-based platform, include dedicated areas for selling merchandise. âThere are a few attributes that will make digital products particularly valuable,â said TJ Leonard, CEO of stock media platform Storyblocks. âThose who are able to bridge the virtual world with the physical world will necessarily be more valuable. Platforms like Monaco Market are betting that this kind of physical-virtual coupling will become mainstream as the metaversal economy takes shape, creating dedicated NFTs associated with real collectibles like sneakers and baseball cards. .
The metaverse is young, so much more of a novelty than a really useful tool. But as consumer behaviors change due to the COVID-19 pandemic and a new generation of digital natives grow into video games, the metaverse is inevitable – it’s an evolution of the modern internet, not a replacement. With user-generated content growing in importance and users gravitating to game-based platforms, “anyone who creates an internet entertainment product is participating in the metaverse,” according to Steven Salz, CEO of sports betting company Rivalry. .
Ultimately, Salz said, those who will benefit the most from the growing metaverse will not be the brands or platforms that experiment with the virtual space as it becomes mainstream: it will be the same beneficiaries who have the most. took advantage of the video game boom. Whether users play, work, or buy products in the Metaverse, everyone – gamers, brands, and platforms – will need a lot of hardware to make it all work. “If there is to be a winner, it’s going to be the people who make graphics cards, like NVIDIA – and the people who make raw GPU and CPU power will be the winners of this thing, as they always are.” , said Salz. “And then it’s going to be people who make the game engines too: Unreal and Unity will probably find success in this thing.”