Can Brands Capitalize on the $1 Trillion Metaverse Opportunity?
A recent JP Morgan report describes the metaverse as a $1 trillion yearly opportunity. JP Morgan is one of the first major financial corporations to embrace Web 3; the financier opened a virtual bank in the metaverse, the first of its kind.
JP Morgan’s and other leading corporations’ tryst with the metaverse illustrate the prospects that brands and businesses could derive by embracing this next computing frontier. Moving in early on, especially in a strategic way, will also give these brands a first-mover advantage that will be hard to surmount by latecomers in the metaverse. Brands establishing an early presence in the blockchain-based metaverse and other metaverse-style platforms can gain an early foothold in prime virtual real estate. They also have the time and space to develop a long-term metaverse strategy for their businesses and literally grow organically with the metaverse.
At the moment, most brands treat the metaverse as an extension of the internet. That is, they are treating it the same way that they treated the advent of social media. However, industry experts caution that the metaverse is not yet a “scale-and-reach opportunity” and that a metaverse strategy at the moment should still be a matter of quality over quantity. For brands embracing Web 3.0, the metaverse is more about bringing consumers into a new experience altogether in a medium like no other than in driving and scaling up your marketing and sales. Metaverse gives businesses a new platform to create new brand experiences. As it evolves, these may eventually grow into mega business opportunities but we aren’t there yet.
The Metaverse Opportunity Today: What is it Like?
The current decentralized metaverse, which includes platforms such as SomniumSpace, Sandbox, and Decentraland places a premium on the community and has been built on blockchain ownership. These consist of digital experiences that have evolved from traditional gaming spaces such as Minecraft although they have transcended that and grown to encompass various social worlds and events, both in immersive and non-immersive platforms.
Considered from a decentralized standpoint, the metaverse encompasses a diverse array of platforms and these will only grow in the coming years.
At the moment, the fledgling metaverse ecosystems offer an opportunity for defining the amount of virtual land that is available and then enabling companies and brands to buy or lease these and use them to build value in virtual real estate. Many brands are already doing this with varying degrees of success.
The metaverse is not a gimmicky virtual economy like the traditional gaming world. It is the real deal. The metaverse land, like real-world land, fluctuates in value. They can therefore be used by brands as long-term investment assets. Brands that are not yet ready to splurge on metaverse real estate can also lease the virtual land on a short-term or long-term basis so they can test out and learn about the various opportunities offered by the metaverse and how these can fit into their long-range business goals.
Like virtual land ownership, virtual land leases also have their advantages. Leasing, for instance, means that your brand will not be locked onto a single platform. Not all brands have the war chest to pump into metaverse landrush in disparate platforms. The metaverse market is growing by leaps and bounds and, in the future, new platforms are going to emerge that many brands would want to experiment with. From an economic standpoint, it is the metaverse land ownership that will ultimately drive value in the metaverse economy over the long haul.
Best Practices for Brands Immersing Themselves in the Metaverse
Creating a metaverse brand experience requires you to shed off your Web 2.0 ‘eye’ and approach the process with a Web 3.0 lens. This entails brands first grasping what Web 3.0 and the platform, in particular, is capable of achieving for your branding and marketing aims.
Brands have to grapple with the challenge of pushing the boundaries and capabilities of the metaverse platform to make the most of these new experiences. This might require a deep dive into every platform to understand what it can do and how you can leverage its capabilities for your brand. Brands must figure out how they can measure the success of this within the web 3 contexts, how to tap into the current initiatives within the space, and make it work in a way that represents your brand in the metaverse.
Brands can use various web 3 experiences to engage their audiences and consumers. These can take many forms including NFTs, quests with rewards, a portal for earning or buying digital assets like NFTs and wearables, or a platform for socializing with and playing with other brand fans.
When designing and creating web 3 brand experiences, never lose sight of the main goal of keeping users coming back after the initial experience. Once you have that perspective in mind, the rest is all about pushing the boundaries of every metaverse technology along with the capabilities of new platforms to create new ways of engaging and exciting the consumer.
A proven and effective strategy for driving consumers to new metaverse experiences is by building these as part of an ongoing initiative.
Building a metaverse presence should be a longer-term commitment for the players involved. For brands, this is, of course, a completely new challenge. Many have to go through a steep learning curve as they learn to connect in a completely new environment. They also have to build a level of interactivity that was previously not possible with conventional Web 2.0 experiences. This is a process that will require a lot of time to take root.
Metaverse industry experts are urging brands not to go big at this time but to instead start with the small steps. Given that this is a fledgling industry, the biggest opportunity for brands is to get in ahead of the consumer avalanche that is sure to come in the next few years. This will give them the opportunity to iterate, test, and learn from your initial experiences.