I have wanted to take the opportunity for this week’s piece to pivot away from inflation for a moment and discuss a topic that is coming up often enough it bears sharing some observations.
A colleague recently asked an ecommerce executive at a marquis luxury brand, “What topic would you most like to know more about?” The response was quick.
“The metaverse. It’s on everyone’s mind,” they said. “It’s the hot new thing. But what will it look like? For example, what does it mean for in-store versus online sales?”
For most retailers, the metaverse is a fuzzy, mind-bending concept that is hard to define. But experts promise that it will one day mean everything.
For now, roughly half of US consumers know little to nothing about the metaverse.
If they’ve heard of it, likely it was last summer, 2021, when Facebook rebranded its corporate self as Meta. Overnight, the metaverse (also referred to as Web3) became a “thing” — the next frontier in retail branding and marketing.
The metaverse is not a thing, of course. It is an imaginary (virtual) world currently populated mostly by young gamers who spend hours in front of a screen or wearing a headset while creating and playing games with other young gamers around the world.
And it’s huge. Roblox, a leading game platform, currently reports that every day more than 20 million players use it, and the average monthly player count is more than 210 million.
What does gaming have to do with branding?
The ability for people to interact with each other in a virtual world is being pitched by metaverse prophets as, at the least, the 3-D future version of the 2-D YouTube/Facebook/Twitter influencers of today. But that’s just the tip of the iceberg.
Last November the company launched an interactive “micro metaverse” game store on Roblox. Visitors to Nikeland can create their own avatars (the cartoon-like characters that represent the players) and compete against others in sports-themed games.
Gamers can virtually dress their avatars in Nike gear and clothing, and spend virtual money they earn by playing. It would appear to be a runaway success, fueled in part by an “appearance” during NBA All-Star week by basketball legend Lebron James, who “coached and engaged with players.”
In its most recent earnings report, the company said that in its first five months Nikeland was visited by 6.7 million people from 224 countries.
An early example of the reach of the metaverse was a visually dazzling mini-concert in 2020 by rapper Travis Scott on Fortnite, another online game site. The concert reportedly had more than 12 million concurrent views and since has accumulated more than 185 million views on YouTube.
The metaverse may become universal someday, but for now it is the province of Gen Z and, behind it, Gen Alpha (born 2012 or later). For older generations, it is controversial.
A survey conducted last December for Variety Intelligence Platform by Hub Entertainment Research found that 45% of respondents aged 35 or older “indicated hating” the idea of the metaverse. A third rated their feelings about it at between zero and two out of 10.
Only 10% of Gen Z-ers gave it a thumbs down, and small wonder. Gen Z consumers spend twice as much time socially interacting in the metaverse than they do in real life, according to recent research by Vice Media Group and Publicis Groupe’s Razorfish agency.
A third of Gen Z-ers said they would like to see brands develop virtual stores.
More than half reported feeling freer to express themselves in games than in real life; 45% said their game identity is closer to who they really are; and more than three out of four said gaming helps them relax and improves their mental health.
Gen Z may outgrow its metaverse obsession, but by the time it does those consumers — the largest generation ever, almost 30% of the world’s population — will have defined it. What it will eventually look like to brand managers and marketers is unknowable but ignorable at their peril.
Until then, there “will be no clean ‘Before Metaverse’ and ‘After Metaverse,’” according to Matthew Ball, a venture capitalist and metaverse guru. “Instead,” he says, “it will slowly emerge over time as different products, services and capabilities integrate and meld together.”
Certainly, this is a topic for anyone and everyone to become educated upon and perhaps even begin to understand what role their particular customer base may be interested in them playing within the Metaverse.