As early as the 2000s, many companies were faced with an important decision: dare to take the step towards e-commerce? And if so: Do you go through retail, or do you even dare to sell directly to your own customers?
The skeptics believed that this emerging trend could never replace the “real shopping experience”. However, some forward-looking brands such as Adidas or Nike showed courage and creativity and ventured into online trading – with success. Nowadays, there is great agreement worldwide that online sales lead to increased convenience and thus to an improved customer experience. E-commerce has become an integral part of normal everyday life.
Today, in 2022, we find ourselves at a similar crossroads with the Metaverse hype. At least since the renaming of Facebook to Meta, the Metaverse is well known to everyone. A persistent, decentralized digital world that merges with people, places and objects of the physical world? It sounds abstract at first, but the potential of the Metaverse for brands and thus for e-commerce is almost unlimited. In virtual worlds, there are no limits to the imagination of the “creators” – both in terms of the brand experience and the development of communities and completely new business models.
The future is called Metaverse
So the potential for e-commerce in the Metaverse is infinite. It’s not for nothing that more and more brands are taking their first steps into the Metaverse – it’s an incredibly exciting new channel and therefore offers marketers many opportunities to connect with Millennials and Gen Z. But more than that: More and more users will consume in the Metaverse in the future. Bloomberg estimates the market volume of the metaverse economy at around 800 billion US dollars for 2024 alone.
In addition, according to the OMD annalec survey from 2022, a full 61% of brands are either already active in the metaverse or are interested in getting started. The engagement that pioneering brands are already seeing for their Metaverse activities shows that Metaverse Experiences inspire consumers and have the potential to catch on. For example, Dyson launched a virtual showroom in November 2021, which is available as an app via Meta’s Oculus store and made its consumer products, such as the popular hair styling devices and vacuum cleaners, experienceable and purchasable.
E-Commerce in the Metaverse: Luxury groups show how it can work
Well-known luxury fashion groups such as Gucci, Louis Vuitton and Balenciaga are already active in the Metaverse. For example, last year Italian fashion house Gucci offered a wide range of digital items for sale, from virtual sneakers for $13 to a one-of-a-kind handbag for more than $4,000.
These and many other examples make it clear that people are willing to spend money on virtual possessions. Be it in the form of augmented reality filters, with which you can try on virtual fashion on your own body, through integration in open marketplaces such as Decentraland, Roblox and Meta’s Horizon or through specially created showrooms and virtual stores. It is not only since Covid that we humans spend a large part of our time online. Our “digital self” is becoming increasingly relevant and the acquisition of virtual goods will become normal in the near future. Probably the most popular form of these virtual goods are currently “non-fungible tokens” (NFTs), which offer us the possibility to exchange virtual objects (such as art, digital avatars, clothing etc.) or assets between people, companies and authors transfer.
Adidas Originals Into the Metaverse-NFT collection
The Bored Ape Collection, which consists of around 10,000 unique illustrations of bored apes that can be purchased as NFTs, shows that digital artworks can also achieve a rise to multi-billion dollar lifestyle brands. The NFTs, some of which were sold for around 3 million US dollars, are not only a unique, digital collector’s item but also a membership card for the virtual Bored Ape Yacht Club and grant the owner access to exclusive membership only advantages. In addition to such ‘underdogs’, brands such as Adidas also act as ‘first movers’ and use the potential of virtual art. The sporting goods manufacturer worked with Bored Ape Yacht Club, among others, on its Adidas Originals Into the Metaverse NFT collection.
In addition to the respective virtual artwork, owners of the associated NFTs also receive access to four exclusive physical products as well as ongoing exclusive access to future digital products – at no additional cost. 2021 was already a landmark year for NFT sales, with trading volume hitting $22 billion in the last 12 months. Accordingly, NFTs are definitely worth considering for brands. And with the right strategy, there is even the potential for any brand to become the next generation “Rolex” by selling desirable NFTs.
The potential for brands and what needs to be considered
Despite the numerous success stories, there is no guarantee that brand appearances in the Metaverse will automatically become huge growth stories. Rather, it is about opening up this new channel as a brand before the competition, gradually testing the potential and generating learnings in exchange with the community. Of course, it is important to know in advance what goals you are pursuing or what problems you want to solve. For example, if you as a company have the goal of connecting with a target group despite the pandemic, a high-quality and appealing virtual event can be a good solution. If companies want to accelerate their B2B growth, a new collection can be presented in a virtual showroom
presented in an inspiring way and ordered directly by the buyers. And for the growth of B2C business, the launch of a virtual store is ideal, where consumers can purchase digital and physical products or services.
Ecommerce in the Metaverse: The time to act is now
Even if the Metaverse is still new territory for companies and customers today and the development of three-dimensional e-commerce experiences may seem complex: Entering the Metaverse can be the right step for brands right now. Because only ‘first movers’ will gain a competitive advantage and be able to set themselves apart from their competitors. The longer companies wait, the greater the knowledge, skills and competition gap will become. Right now it’s time to be brave and open to new things and – just like in the 2000s – to give yourself a push and take the “bet Metaverse”.
Also read: Online trading – 10 measures that lead to success.
The author Jan Gutkuhn is Managing Director & Partner at the international digital agency Dept. He is co-founder of the Meta Festival and is responsible for sales, marketing, innovation and the expansion of new agency services such as Web3.0, Metaverse and Live Video Shopping.