In an era of constant technological innovation, experimentation and tech dollars running awash, it is difficult to know what will last the test of time.
Facebook, or Meta as it’s now known, has invested over $10bn into the metaverse through its Reality Labs segment. Its commitment to the metaverse is meaningful, and the tech giant has committed to creating 10,000 jobs in Europe over the next five years in support of its metaverse ambitions. Banking giant J.P. Morgan is the first to open a bank in the metaverse, and strongly believe the metaverse will become a $1tr a year opportunity.
NFTs have been controversial, and many simply refuse to interact with – and once again – do not see its point or problems that it is fixing. However, many brands see NFTs as a comfortable way to interact with the new generation of internet users and technologists. They represent powerful marketing opportunities, and brands are unlikely to forgo this.
Overall, the metaverse is an interesting proposition and one worth investigating. It’s an industry that’s set to be worth $800bn by 2024, and franchise brands will want a piece of it.
What exactly is the metaverse?
Technically, there is no single and all-mighty ‘metaverse’. The metaverse is a collection and connection of 3D virtual worlds that focus on social networks. These individual words may be connected, but they do not need to be.
“The metaverse is a digital playground which is hosted on a blockchain, in which users will workout, play, create, work and interact with each other, all through avatars representing themselves,” said Andy Hall, head of commercial at OliveX, the company building TRIB3’s metaverse offering.
“Whilst many industry experts are touting a scenario similar to the Hollywood movie Ready Player One, the reality is that the technology required for that is either still in development, or is out of reach for the majority of the world.
“This doesn’t mean, however, that we cannot see some of the possibilities of the metaverse realized with our current generation of technology.”
Aspects of what is considered the metaverse already exist in many ways, just without the use of virtual reality (VR) and augmented reality (AR) headsets. Many video games such as Fortnite represent a virtual universe in which characters can interact with each other. Video games also contain an essential element of metaverses today – e-commerce and the purchase of digital products and services.
Fortnite has amassed 350 million players as of May 2020, many of whom are likely to take the next step into the metaverse with AR and VR. The global VR, AR and mixed-reality (MR) market is estimated to be worth $300bn by 2024, undoubtedly supported by growing interest and interaction with the metaverse.
The digital economy within the metaverse is the key. Currently, many games allow customers to buy items like digital clothing that they can wear throughout the game, but this concept can be extended to an entire social metaverse. The Sandbox, which TRIB3 will release its services on, allows users to purchase NFTs, which will undoubtedly raise the profile of the brand in different circles.
The long-term notion is one of integration between the metaverse and the real world. A clothing brand could enter and build a store in the metaverse, allowing customers to shop in the metaverse, and have that order fulfilled in real life.
McDonald’s filed a patent for that very purpose, to be able to build virtual restaurants and deliver the chosen menu items in real life. Various meta-cyberspaces will become the place where many people – especially younger – will spend a lot of their time with their friends. It, therefore, stands to reason that a brand must be present where its customers are.
“I think we will see all sectors making a play. McDonald’s filed for trademarks for an entirely virtual metaverse restaurant that delivers your food,” said Hall.
“If you’re in the metaverse and you get hungry you won’t have to leave you can just place your order online and then it will be delivered to your door in real life. The beauty of the metaverse is that it blurs the lines between on and offline.”
As a revenue generator and marketing opportunity, the metaverse’s limits are endless, but it entirely relies on the degree to which people adopt it, and based on previous trends, it’s no guarantee.
What are the opportunities for franchise brands in the metaverse?
The nebulous nature of the term ‘metaverse’ makes it difficult for brands and marketing teams to understand what the purpose of the metaverse is, and therefore its reason for entering the virtual space. There are two main reasons why brands would enter the metaverse: revenue and brand exposure.
“From a brand and PR point of view it’s driven wide-reaching coverage and excitement but commercially speaking, we have the ability to drive serious revenue and reach,” said Kevin Yates, CEO of TRIB3.
“The opportunity the metaverse presents to brands is incredible – but only for the brands which can realize and recognize it.”
Gucci reached a new generation of customers by re-creating its Florence store in the Roblox game ahead of its centenary. It was a great success, and Gucci shared the profits of the campaign with the game creator, demonstrating that there are platforms that can promise a strong ‘virtual footfall’. Roblox has 47 million daily active users, and 9.5 million ‘developers’ who create games and experiences on the platform.
The global giant, Coca-Cola has gotten in on the act too. It collaborated with 3D creators at Tafi to host an auction for ‘loot-boxes’ of NFTs, meaning customers would pay for an NFT locked in a virtual box, not knowing what it is until it is opened. This auction brought in $1m, insignificant for Coca-Cola, but worth a lot more in marketing and brand exposure to a different audience. Some of the NFTs were wearable and could be worn on other platforms, such as Decentraland.
“NFT investment is still one of the hottest trends right now. An important factor to recognize is that good NFTs can add value to what you might be doing in the metaverse/gaming world and aren’t always a vanity piece,” said Hall.
“Part of our metaverse play will be the launch of a series of TRIB3 NFTs. We can’t say any more than that right now, but we are working with the OliveX developers on this and it’s going to be incredible,” said Yates.
Who is already in the metaverse, and what are they doing?
Franchise brands tend not to make quick decisions, or foray into something without intricate plans and contingencies. It’s the nature of a business that may have hundreds of individual owners and working with a standardized operating procedure. It’s no surprise that a majority of the industry is still watching and waiting.
TRIB3 was one of the first, when it announced its partnership with Sandbox. TRIB3 will deliver its services, construct a virtual gym and sell its products through its presence in the Sandbox. Helping TRIB3 in this quest is OliveX.
“TRIB3 is all about doing things differently and breaking the mold. We sold our first franchise for bitcoin in 2021 and are going to be offering the option to pay in cryptocurrency at our stores, in the near future, so the metaverse was always going to be a key play,” said Yates.
“We are expanding and growing at pace in the real world – so why not take it “out of this world” as well. We’ve partnered with OliveX, an organization really pioneering how the fitness metaverse is going to look, on this venture. They were looking for innovative brands to be part of their Sandbox land and we are going to be the first-ever boutique fitness brand to enter the metaverse.”
An opportunity worth investigating
While many are understandably skeptical about the metaverse, that shouldn’t stop a brand from exploring new opportunities in the virtual world. There is no real way of knowing the future of this trend, but if it does grow and become a part of everyday life, it will become a non-negotiable area to market and potentially sell services/products.
“I think more brands will certainly enter the metaverse and more brands will certainly start to use cryptocurrency more broadly across their operation but we see it as a positive if more brands can come together,” said Yates.
Fashion brands have already made profits from their collaborations with these platforms, but is there truly any space for business-to-business brands, or brands that don’t have an element of entertainment to find a home in the 3D virtual world?
There may be in long run, which is why brands should make an initial investment into the infrastructure so that they can enter any metaverse if and when the time is right.