After Facebook CEO Mark Zuckerberg made the statement “We aim to become a Metaverse company”, the concept of metaverse has gained the attention of brands, consumers, and technology enthusiasts alike. Brands that have sped up their digitalization process during the pandemic are now faced with a brand new metaverse transformation.
So, what does metaverse mean for companies? In the pursuit of answering this, investors and companies must scrutinize the opportunities brought about by metaverse.
The concept of the metaverse was first introduced in a 1992 science fiction novel titled “Snow Crash” by Neal Stephenson back in. In this book, the metaverse represents a collectively-shared social virtual area. The metaverse can be thought of as an embodied internet where the physical world meets the virtual one.
Users will enter the metaverse as an avatar and, similar to social networks, users can chat with their friends in a virtual environment, shop together, organize joint business meetings or take remote classes.
For the social network giant Facebook, the metaverse is considered to be the successor to the internet that we know today. Thanks to the popular products within its application family and its wide user base, Facebook is a corporation positioned to build the virtual community of the future.
With AR wearables like Ray-Ban brand smart glasses emerging and hardware like the Oculus, Facebook can integrate the metaverse with profiles on Instagram, WhatsApp, and Facebook.
Following the concept of “social networks” with the products it has developed, Facebook is constructing the concept of “social commerce”; and the company has set its eyes on generating a virtual shopping experience in the metaverse environment.
In the last 2-3 decades, we have witnessed a significant transformation in nearly all industry sectors, and especially in retail. The retail sector has been greatly impacted by the internet and smartphones. E-commerce websites have been replacing physical stores, and now e-commerce is slowly being replaced by shopping within social networks. As the next step of this digitization process, the metaverse is presenting businesses and consumers with a future where individuals will be living, working, and shopping in a virtual world.
Imagine an Instagram store converted into a 3D, virtual experience mirroring that of the physical world. A brand’s place in the metaverse is found when their digitized products that can be purchased by thousands of users worldwide.. Users can shop as their avatar in this digital storefront and can make their selections to be delivered to their home
As a result, over the next decade we will observe that, regardless of the sector, retail giants will slowly shift from the common internet to metaverse due to the increase in customer interaction and the time spent in the related platform. This will bring about an increase in the company’s budget and resources allocated to entering their brand into the metaverse environment.
Some metaverse experiences are already being provided by many gaming companies and even cities.
For example, during the pandemic, the State of Finland invited the public to a concert in virtual reality to celebrate the 1st of May. The concert was viewed by 700 thousand people through video streaming and virtual reality headsets . With a total population of 6 million people, this amounted to nearly 12% of the population in Finland. 150 thousand of the participants attended the event as avatars in virtual reality.
Helsinki Municipality partnered with a virtual reality company to construct a virtual copy of Helsinki. While opening the door to tourism in the metaverse, the Helsinki virtual city will be able to present its brands to global consumers.
The U.S. is following Helsinki’s example and, in a not-so-distant future, consumers will be able to visit stores in New York or the Bay Area from anywhere in the world.
There is a small “metaverse” being built by gaming corporations. Epic Games’ most popular platform, Fortnite, has already entered the metaverse through a virtual concert with Travis Scott in 2020. The concert was simultaneously attended by 12.3 million gamers.
The Travis Scott concert is not the only event hosted by Fortnite. A Marshmello concert took place in Fortnite back in February 2019 and was attended by 10.7 million people. Fortnite concerts are drawing more attention each year and the Travis Scott concert broke Fortnite’s own record for amount of attendees.
Another notable example is Roblox’s use of the metaverse, where users spent nearly 10 billion hours playing in the first quarter of 2021. On average, 42 million users connect daily in this platform and spent $652.000.000 in total for digital assets for theri avatar, such as clothing and accessories.
Epic Games has formed a partnership with the brand Balenciaga in order to bring Fortnite players high-end fashion for their avatars. Balenciaga is working on virtual apparel and opening an in-game Balenciaga store front.
It has become common for fashion brands to design virtual products. Gucci partnered with Roblox in May to create a surreal virtual garden, and,back in 2019, Louis Vuitton had designed looks for the characters of League of Legends by Riot Games. Furthermore, Balenciaga has designed a game with Unreal Engine to introduce its Fall 2021 collection.
In the future, the price you pay for a concert in the metaverse will be determined by how close you can approach the singer compared to other users in attendance. By putting on their $4,100 shoes specially designed by Gucci for Fortnite, a user’s avatar will stand out amongst other attendees. These virtual items, while not so common today, will be an integral part of the metaverse economy.
As the metaverse becomes the next, embodied internet, brands will turn their efforts towards generating content and marketing strategies for VR and AR. By converting products into 3D models or preparing creations specially for virtual environments, brands can consolidate their place in the metaverse. The metaverse will create a new way for brands to create the shopping experience of the future, complete with life-like models, immersive 3D content and realistic AR filters created by the QReal team.