The metaverse may be largely theoretical at this point, but companies are already investing time (and large sums of money) in figuring out how to capitalize on the newest way that people around the world connect with one another.
As metaverses continue to develop and become more of a social and business hub, one crucial question for companies is how to best engage in marketing on this new platform. Metaverse marketing is big business indeed, with the size of the space estimated to be $1 trillion by as early as 2024.
User Data in the Metaverse
In our current Web 2.0 space, marketers have access to a trove of information about users as they interact and shop online. The opportunities to tailor a virtual experience to a user based on his or her preferences are likely to only increase with the advent of the metaverse: in addition to demographic info, metaverse shoppers will generate data similar to in-person shoppers. This includes time spent looking at a particular shelf in a virtual store, how much time avatars spend in digital marketplaces, and so on. Marketers can use this information to not only generate targeted advertisements, but to build an entire targeted virtual world—everything from the way a virtual storefront appears to the ways that an AI-powered sales associate interacts with customers can be customized. Users will also be able to provide product feedback to a company directly, eliminating the need for analysis of social media behaviors and similar processes.
On the other hand, users of the metaverse are likely to be increasingly cautious about how their data is captured and shared. Because the metaverse is so new, it is likely a legal and regulatory framework governing the area of information security will take time to catch up with technological advances. So companies must be transparent about the ways they generate and use customer data and must provide assurance that users will be protected as they shop and interact, or they are liable to face consequences.
New Marketing Tools in the Metaverse
The metaverse will dramatically expand the possibilities for marketing, but it will also increase the stakes for companies. With users controlling more of their data in the metaverse than in Web 2.0, companies must be prepared to find innovative ways to engage with potential customers to gain access and build or maintain a brand. Fortunately, there are many ways to do this in the metaverse:
- Gamification: The metaverse of today is perhaps best exemplified by video games like Fortnite that have broad user bases interacting in a variety of ways. Companies that introduce game-like elements and reward systems may stand the best chance of securing customers. Companies like Balenciaga and Coca-Cola have already taken advantage of this. Balenciaga released a line of high-fashion skins for use on Fortnite avatars, as well as digital in-game accessories. These virtual products could be purchased or traded within the game, and Balenciaga also offered real-life versions as well. Coca-Cola launched a new flavor, marketed as being “born in the metaverse,” alongside a tie-in mini-game within the Fortnite ecosystem. The sky’s the limit for games like these.
- Collaboration: In an interconnected virtual space, the possibilities for collaborations between brands (even seemingly dissimilar ones like fashion designer Balenciaga and video game Fortnite) become easier and increasingly expected. Another recent metaverse collaboration brought together Nike and Roblox. Nike customers could create an avatar in the Roblox metaverse and play games to earn various virtual and real-life rewards.
- NFTs and cryptocurrencies: Even companies accustomed to selling only tangible goods will likely need to expand into digital offerings. These include branded NFTs, already popular among brands including Adidas and Taco Bell. Nike produced virtual sneaker NFTs which was followed by an increase in profits of over $12 billion, for example. Expect more companies to also produce their own cryptocurrencies. These virtual goods may be especially focused on avatar enhancements. 90% of metaverse users want the ability to customize their digital persona with virtual clothing, goods, and accessories. These virtual goods have already commanded sale prices in the thousands, as reflected by recent sales of a digital Gucci bag for over $4,000 and a Digital Coutour dress for nearly $10,000.
- Hybrid real/virtual campaigns and projects: The metaverse may largely replace our existing ways of interacting and shopping, but the strongest marketing projects will likely hybridize virtual and real-life efforts to maximize impact. Native advertising campaigns including billboards and brand logos can take place in virtual locations as well as real-life ones. And savvy companies have already launched side-by-side virtual and real goods, as in the Balenciaga example above.
- The size of the metaverse marketing space could be $800 billion by as early as 2024.
- The metaverse will provide the opportunity to gather much more customer data than is possible in Web 2.0, but issues of user security are prominent.
- Marketing in the metaverse is likely to be dominated by gamification, collaboration, NFTs and cryptocurrencies, and hybrid real-life/virtual campaigns and projects.
- Some early examples of metaverse marketing include those by Balenciaga, Nike, and Coca-Cola.
- Nike developed virtual sneaker NFTs and subsequently saw profits increase by over $12 billion.
- 9 out of 10 metaverse users want to be able to customize their avatar with digital goods and accessories.