Nike, Axa, Balenciaga, Forever21 or even Carrefour, there are many brands investing in virtual universes, and not a day goes by without a new announcement effect. So much so that some forecasters are already envisioning a total market for the metaverse of about $700 billion by 2030!
Hard to believe for most, because these metaverses are still in an embryonic stage – it’s clear for now how weakly this universe is penetrating to the general public. Add to this the weak signals that the market has been sending out in recent months: correction in the price of cryptocurrencies, waning enthusiasm around NFTs, etc.
So, should you invest in the metaverse if you’re a brand? Is it really accessible to all brands? What do we have to gain by venturing there today? How do you prevent loss, both in the short and long term? And above all, what place will it occupy in the brand experience of tomorrow?
We often talk about accelerating the pace of change. What’s new about Web3 is that it matures at breakneck speed and integrates brands from the ground up. Because these virtual universes today need brands to gain credibility, just like some brands need them, for image and experience reasons. Fifteen years ago, debates raged over Facebook’s profitability and the place brands could occupy in it. It took at least 6 or 7 years for the iconic web 2.0 platform to spawn a profitable model.
In contrast, Web3 immediately offers a completely different paradigm, making it an essential playground for brands, for at least three main reasons.
First of all, Web3 is based on a so-called “decentralized” philosophy and model. Against the domination of GAFAM, it offers a democratic and open model, where all actors are welcome. Sébastien Borget, co-founder of The Sandbox (one of the reference platforms, with a gaming and social vocation, among the metaverses under construction), explains that in the long run “only 10% of the platform’s content will be produced by The Sandbox” – the rest is in the hands of the “creators”.
At the forefront of these makers: the brands. Today, there is a degree of equivalence between platforms and brands, who now have a card to play by experimenting and offering an experience to their image, which resonates with their DNA, their identity and their values. True IRL cultural landmarks, they have the fame, intangible assets and financial resources to deliver original and customized experiences to meet the needs of new Web3 explorers. The fashion and luxury industry is leading the way in this area, as Louis Vuitton was able to do with League of Legends, but many other sectors are gradually following suit.
As for these new explorers of Web3 exactly, they are younger, more connected, looking for experiences and shared moments. So there is an essential playing field and conquest for brands, who must be present where their consumers are, to entice the Z and Alpha generations. It is then a matter of taking a step forward by making a link with the consumers of tomorrow – also the day after tomorrow.
Finally, Web3 operates on a more mature business model than previous iterations. Central to this model is the issue of value creation and its sharing between stakeholders. Creating communities (the famous DAOs) with their own tokens and cryptocurrencies, the logic of “play-to-earn”, or even the compensation of the attention of Internet users (see the model of the Brave web browser and its own currency , the BAT) are all examples of this financial maturity. Of course, this doesn’t mean that all Web3 business models are destined for success! As with any entrepreneurial adventure, only time will tell which models will hold up over time…
So, of course, venturing into the meanders of the Metaverse and its ecosystem carries some of the risk. Brands need to ask themselves the right questions: are my brand assets projectable in Web3? How can I provide a consistent experience across all channels and touchpoints already activated by my brand? Or is it possible to project yourself in this universe in a responsible way, so as not to betray the brand commitments already made elsewhere in the field of CSR?
However, it seems that soon it will be more risky for a brand to stay away from Web3 than to invest in this space – thoughtfully and responsibly, and of course with good support! Experimenting and exploring is still allowed and the possibilities are endless, with the aim not only to invest in a platform, but to offer real experiences and content in line with the brand strategy.
(The forums published are the responsibility of their authors and are not related to CB News).