Doing Business In The Metaverse
- The metaverse — a new 3D, virtual environment — has risen to prominence of late.
- Many businesses and organizations have started to colonize this new space to sell virtual versions of their products or display their content.
- The metaverse will not necessarily be a game changer for all businesses. However, business leaders should consider the matter and be prepared to adapt in order to seize new opportunities
In late 2021, Facebook’s rebranding as Meta triggered a surge in interest in the metaverse — a three-dimensional, virtual-reality space where users can interact with computer-generated environments and other users.
Although the technology and the use cases are still under construction, the market shows great potential. According to crypto-economy expert Grayscale, the metaverse may create up to $1 trillion in annual revenue.
What’s more, if metaverse enthusiasts are to be believed, this nascent universe will dramatically transform the way we live, interact, work, learn, consume, and do business.
Are we really at the dawn of a paradigm-shattering revolution? Or is the metaverse just a fad that will remain the preserve of comparatively small circles of techno-geeks?
In any case, it may be a good idea for business leaders to test the waters and ask themselves what the advent of the metaverse means for their organization.
New Spaces to Conquer
The metaverse opens up new virtual environments in which people can play, socialize, trade virtual assets and even work and earn revenue. This obviously creates new opportunities for brands and companies.
Ralph Lauren and Balenciaga are just a few of the many businesses that are starting to colonize the metaverse to sell digital-only fashion items. Overall, the potential value for the fashion industry is allegedly upwards of $50 billion, according to Morgan Stanley. And Nike reports almost 7 million visitors to its metaverse-based “Nikeland” in just a few months.
Advertisers, content producers and event managers are also taking advantage of this new medium to showcase and promote their creations or convey their messages. Additionally, 360° and 3D technologies are empowering them to craft new forms of storytelling.
In addition to new marketing outlets, the metaverse creates new possibilities for consumer experience. For example, the virtual reality technology used by Metaversers empowers them to inspect or try out products 24/7, wherever they are in the world. Geographical barriers to delivery are not a concern for shoppers of virtual items.
Unsurprisingly enough, virtual “land” inside metaverse spaces is increasingly coveted. Some parcels have sold for over $2 million. Growing numbers of businesses are deciding this is worth it.
A Turning Point for Businesses?
So far, we’ve considered the metaverse as a “second world” that sits on top of our physical reality, creating extra marketing channels and consumer experience opportunities. But some predict that there’s much more to it and that we’ll live primarily in the metaverse soon.
The likes of Facebook and Microsoft are currently trying to replicate office environments and experiences virtually.
Some people hold their primary jobs in the metaverse.
And we’re witnessing the creation of “virtual native” companies with no presence whatsoever outside the metaverse — just like digital native companies that do without brick-and-mortar shops.
However, can you really see yourself content with a virtual-only life — including friends you’ve never met in person, a 3D rendering of your significant other, a closet full of clothes you can’t touch, and a work life spent solely from your home office?
This is one of the main objections voiced by metaverse skeptics.
At this point, the metaverse is just not enough to compete with real life — and with the real economy. Second Life (the ancestor of the metaverse) once had a $500 million GDP… compared with a $85 trillion global GDP.
Some go as far as to argue that the metaverse has no clear additional value beyond the sphere of entertainment.
A Trend to Watch
To sum it up, the metaverse is not necessarily the future of business, but it may well create new economies and new opportunities.
Businesses that are active in the fields of advertising, gaming, fashion, entertainment — or anything that has to do with selling experiences — should definitely revise their strategies for marketing and consumer experience to include virtual reality.
But exploring opportunities in the metaverse might also make sense for other kinds of businesses. For example, a meta-entrepreneur who wants to insure their virtual shop might as well look for an insurance provider in the metaverse!
Yet for other business lines — take delivery services for example — embracing the metaverse is not that obvious a move.
If we have one piece of advice for hesitant business leaders: stay abreast of what’s happening and be poised for action. The metaverse is only nascent. No one really knows what turn it may take, and when. Adoption may accelerate dramatically and the emergence of new use cases may change the game rapidly.
As with every new opportunity, the metaverse comes with the risk of missing out.
As always in our fast-changing world, success hinges on the ability to respond swiftly to unexpected change — in other words, be agile.