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First, it was the obsession with non-fungible tokens (NFT), and now it's all the rage with the metaverse. While the term "metaverse" is not new, it has been popping up more prominently in the marketing world in recent times. Last month, Facebook founder and CEO Mark Zuckerberg said the company is creating a product team to work on the "metaverse" in hopes of transitioning from a social media company to a metaverse company. Meanwhile, the South China Morning Post partnered with The Sandbox, a decentralised gaming virtual world, in July to bring Hong Kong to life in The Sandbox's metaverse.
Epic Games, the developer behind popular video game Fortnite, also expressed interest in building a metaverse in April this year. Earlier in 2021, Epic completed a US$1 billion round of funding which would allow it to support future growth opportunities, and its equity valuation is now US$28.7 million. According to Epic, the investment will help accelerate its work around the metaverse and building connected social experiences in Fortnite, Rocket League and Fall Guys. Newzoo's "Intro to the Metaverse" 2021 trend report considered video games Maze War and Animal Crossing as well as graphics-based virtual community Habitat and online game platform Roblox to be milestone events in the history of the metaverse.
So what is the metaverse?
According to multiple media reports including The Guardian and Vanity Fair, as well as an academic paper titled "'Hiro' of the Platonic: Neal Stephenson's 'Snow Crash'" by Carl Boehm, the term "metaverse" was coined by Stephenson in his 1992 sci-fi novel Snow Crash, and was used to describe a cyberspace realm. In layman terms, and in the words of industry players MARKETING-INTERACTIVE spoke to, the metaverse is a digital environment that replicates the real world, and allows for users to interact with both a digitally-generated environment and other users via their digital avatars.
"Think of a virtual world, where you not only play games in but go about your daily life in, such as conducting business meetings and shopping," Irwin Lim, Deloitte Digital Southeast Asia's executive director, said. Like the movie The Matrix, for example, users will feel immersed in the virtual world using technologies such as AR, VR and others that are not yet available, he explained.
Aside from replicating the real world, the metaverse is also "the convergence of extended reality, the Internet and blockchain technology," said Zoe Cocker, head of brand and RYOT Studio, Australia and New Zealand. It also exists across all platforms from gaming to social media.
So how is this different from video games such as Fortnite, where artistes such as Ariana Grande, Travis Scott and Marshmellow have held their concerts in, and the online virtual world of "Second Life" which is an online virtual platform where you can create your own avatars and interact with people?
Second Life, for example, is a great entry point in the early stages to get individuals excited about the possibility of a metaverse, Cocker said.
However, the fundamental idea of a metaverse is an online universe where people can travel and create freely, and transfer items or currencies and outfits from one universe to the next.
Gaming worlds such as Second Life and Fortnite immerse their audience in an entertainment experience that is purpose-built and non-transferable. Cocker explained that the ultimate aim of these platforms is to entrench users in their world so much that they never want to leave.
"Whereas the metaverse offers the possibility of a complex 3D universe of people, places and things, all connected to one another and traversable with our digital selves. Ultimately the metaverse offers varied experiences that mirror the physical world; commerce, education, entertainment, creativity. It essentially contains anything we can collectively unleash from our imaginations," she added.
Similarly, founder and managing partner of REISE, Sudhansh Jadon, said the metaverse makes the experience whole by connecting all the virtual worlds together. While most video games have a universe or metaverse of their own and users can create identities within, he explained that users "cannot bring all the stuff [they] did within the game to another world or another game".
"Imagine, you build a nice pyramid in a game such as Minecraft by spending countless hours. You can visit your pyramid anytime you want but within the Minecraft universe. Metaverse will allow you to actually bring that pyramid with you to a deathmatch or a dance party in Fortnite. How cool is that?" he added.
How relevant is the metaverse for the advertising and marketing industry?
In 2016, Alibaba Group attempted to create a virtual shopping experience for consumers via Buy+, which only required a simple cardboard VR headset and smartphone combo. Customers can make purchases in a virtual environment by browsing through a department store and tap on the products for the descriptions and price.
Marketing and advertising is all about going where consumers are and targeting them with innovative and authentic ways. According to Ampverse's co-founder Charlie Baillie, social media has allowed brands to achieve that and the evolution of the metaverse is a natural next step in this process. If audiences today are showing that they are willing to engage with digital avatars, or consume content be that from fashion brands or their favourite artists inside of digitally generated environments, then brands need to be there and add value to this experience in order to stay relevant, he said.
Likewise, founder and MD of First Wave Singapore, Don Tsai, said metaverse could potentially be a new media platform where consumers are flocking to. He said,
Ignoring the metaverse is like ignoring social media as a potential media channel to reach consumers 10 years ago, and doing so is extremely foolish now in 2021.
"Does this mean the metaverse is the only place to be for marketers and advertisers? Of course not, but it should be in every marketers' and advertisers' playbook to build up competence," Tsai said. Using Facebook as an example, Tsai said if a social media giant like Facebook takes metaverse seriously, this is a sign that consumer behaviour shifts are happening.
With consumer behaviour shifting, it is also time for brands to begin thinking about the mindset of a digital customer in the metaverse. Jean-Francois Thery, UltraSuperNew's head of growth, Asia Pacific, said:
As an advertiser, it’s no longer about having a bunch of advertising in the metaverse, but figuring out how to create user-driven engagement that includes a fully immersed digital experience.
He added that all brands need to consider the future of commerce. According to Thery, those who understand culture, digital ownership and gaming will thrive in the metaverse.
Is metaverse the one for your brand?
According to Newzoo's report, industries that have jumped into the metaverse, according to the report, include music, TV and film, tourism, retail, factories, FMCG, sports, fashion and cosmetics, as well as automotive, among others.
Those in the fashion, retail and entertainment space are best placed to capitalise on the first-mover advantage when it comes to the metaverse, RYOT Studio's Cocker said. That said, there still should not be any barriers to which industries can join the metaverse.
For brands curious about the metaverse, a starting point would be to invest in 3D models, digital items and AR. According to Cocker, brands in the consumer categories such as fitness, cosmetics and furniture retailers are already using AR technology to create digital "Try before you buy" experiences. RYOT Studio recently worked with Australian department store BIG W on an AR campaign enabling customers to virtually place products from the store's Toy Mania range in their own spaces, allowing consumers to view objects at scale and in real-time. Such activations are easily translatable into immersive metaverse stores.
The next step, Cocker said, would be to look at technology such as blockchain and NFTs and explore game engine technologies that can recreate the physical shopping experience within the new digital world. Some brands that have already dipped their toes into the NFT scene include Coca-Cola, Budweiser, Warner Bros., Campbell's, and Louis Vuitton. In addition to RYOT Studio, agencies such as VaynerNFT and REISE are also involved in helping clients build up its NFT portfolio.
REISE, for example, partners with a full-cycle production studio named Dapp-Craft to create experiences for metaverses and among them includes creating NFTs for brands interested in this space. While brands that are offering services or eCommerce can tap into actual sales-driven campaigns, REISE's Jadon said the metaverse will be relevant for all brands in different capacities. However, the bigger question is who will use it in the most effective way.
"With more people joining the metaverse every day, it is not far when brands can find the same reach and awareness within the metaverse as they do with the real world. I can imagine Coke with an NFT within the metaverse, which is a building the size of Burj Khalifa. Or people buying a Louis Vuitton NFT for their metaverse avatars knowing it's a unique jacket they are wearing," Jadon said.
If a brand is present in the real universe, it can be present in the virtual universe or metaverse, doing pretty much the same thing.
Also, stepping into the metaverse is not necessarily a mammoth task. In fact, brands are advised to stick to existing communities. According to Ampverse's Baillie, brands should not try and build their own metaverse. Instead, start by partnering with the existing communities that exist within major game titles, for example, and find ways to either add utility value or entertain the community via their brand.
Is your brand the right fit for the metaverse?
Metaverse might seem like an area for digitally-first brands but Baillie is of the view that regardless of whether one is a digitally-first or legacy brand, they will succeed in the metaverse as long as they have a clear objective to target, and engage with the younger audiences aged 16 to 30. In this case, brands should take the time to understand this new medium and test and learn.
"It's no different to when Instagram first came on the scene or TikTok. Think of it as a new channel like social media; take time to understand it and then apply your brand in a way that is contextually relevant," he added.
Agreeing with him was First Wave's Tsai, who explained that brands need to be clear on their business objectives, such as branding versus promotion versus sales. Instead of being overly ambitious and having multiple objectives in one initiative, brands should align their target demographics with the metaverse concepts they are exploring and set reasonable ROIs to track their efforts.
For example, Tsai said brands already using influencer marketing can explore virtual influencers while teams with blockchain experience can look at NFTs. However, for those that are new to the metaverse, Tsai said they can start by adopting and diving deeper into gamification.
On the topic of treating metaverse like a new channel, UltraSuperNew's Thery said legacy brands need to understand the properties of the metaverse as the latter inherits a lot of traditional roles of marketing channels, such as the role of TV, the Internet and social networks.
"The Internet as we know it is very much focused on access to information and transactions," he said. In the metaverse, that will switch to a focus on activities.
"As the space evolves to include more immersive verticals such as shopping, education, travel, it will become more game-like, more activity-focused and more social in nature. One way to start is to imagine how users could experience or interact with the brand through digital experiences."
On the other hand, REISE's Jadon thinks legacy brands are game enough to try new and different things. Brands, in general, have been forced to digitalise due to the pandemic and with most legacy brands using digital as one of their key channels for sales and marketing, he said this new mentality will help convince plenty of legacy brands to explore new opportunities.
"Most brands care about the numbers and until there are numbers involved, I don't think it will be too difficult to justify the ROI behind entering a new space," he said. While brands might be slow to jump on the trend, Jadon said it will definitely pick up pace as more brands understand the importance of being present in the metaverse.
Photo courtesy: 123RF
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