How far have you gone in exploring the captivating world of the metaverse? The metaverse is a vision of what could be the next iteration of the internet: a single, shared, real-time rendered, 3D virtual space that provides digital experiences as an alternative to or a replica of the real world. The global metaverse market size is projected to surpass around USD 1.3 trillion by 2030.
However, currently, the metaverse isn’t a singular entity or place. Any company can, in theory, create a metaverse. From helping remote teams collaborate better to providing unique virtual events, both small and large organizations are already taking advantage of the metaverse to improve various aspects of their business.
In this conversation between Sabine Burrichter, Marketing Manager at Contenterv, and Johanna Schubart, an AMD Academy for Fashion and Design in Hamburg graduate with a Bachelor of Arts degree, we delve into the metaverse and how it might work in practice.
Schubart's thesis, titled "The Metaverse as a New Communication and Commerce Platform," established her as a prominent figure in discussions about the metaverse's influence on the fashion industry. Her research covered both theoretical aspects and practical applications, featuring a comprehensive expansion strategy for the renowned fashion brand Louis Vuitton.
Sabine: Metaverse is a compound term from the prefix meta (meaning "beyond") and universe. The metaverse is best characterized as an evolution of today’s internet. It represents a convergence of digital technology to combine and extend the reach and use of artificial intelligence (AI), augmented reality (AR) and virtual reality (VR), spatial computing, and more. One aspect of this is to unify the various action spaces of the internet into one reality. Johanna, what connects you to the metaverse?
Johanna: I've always been interested in advanced technologies, and last year I wrote my bachelor's thesis on "The Metaverse as a New Communication and Trading Platform." And after that, the topic just stuck with me.
Sabine: The term metaverse was coined by the American Neal Stephenson in his 1992 science fiction novel "Snow Crash," which describes a virtual world as the successor to the internet. It’s a dystopia in which people use avatars of themselves in a three-dimensional virtual space. So, to start with, how can we interpret the term metaverse today, and how can this concept be defined?
Johanna: At the moment, I think the metaverse should rather be understood as a future concept of a decentralized virtual and immersive world. It should offer humans a second reality. There is no universally accepted definition. However, some attempts to define it are based on the same core assumption that the metaverse is a digital/virtual space. Other aspects of the different definitions usually diverge. For example, there is no agreement on whether the metaverse must consist of a single digital space or whether it can also include multiple metaverses, i.e., multiple digital spaces that are connected to each other.
Sabine: So, we should be more careful with using the term metaverse?
Johanna: In my opinion, yes. For the time being, I would clearly differentiate between the currently existing virtual spaces or worlds and the concept of the metaverse. If we go a step further and look at Matthew Ball's definition, we will notice several features that do not yet exist or are only available to a limited extent. These include, for example, three-dimensionality, synchronicity, persistence, massive scalability, network interoperability, unlimited numbers of users, and real-time rendering. Also, most people are often under the impression that the metaverse is an invention of Marc Zuckerberg or the Meta company.
Sabine: For those who don't recognize the name, who is Matthew Ball?
Johanna: Matthew Ball has been one of the most influential writers analyzing the technological and cultural shifts behind the emergence of the metaverse. His first book, “The Metaverse: And How it Will Revolutionize Everything”, published in 2022, became an international bestseller.
Sabine: If we look at the technical requirements needed to use the metaverse, we can quickly see that most of the features are only available to a limited extent, if at all.
Johanna: That is currently still the case. A good example is MVFW 2022, the Metaverse Fashion Week, where the platform crashed repeatedly due to an excessive number of users. Many attendees complained of glitches, computer crashes, and clunky graphics. One of the reasons for this is the network’s bandwidth, which is not currently designed to handle several thousand people at the same time, retrieving large amounts of data.
Sabine: But at the same time, it’s precisely the technical advancements, such as the development of all Extended Reality (XR) technologies — Extended Reality is a collective term for Augmented Reality, Virtual Reality, and Mixed Reality — that repeatedly lead to an upsurge of the topic. It’s primarily through these augmented technologies that the new digital world is becoming more tangible and realistic for the public. If we look at the hype around Apple's Vision Pro, it’s advertised as having revolutionary dual-chip design and the most advanced spatial audio system ever. Responsive, precision eye tracking. More pixels than a 4K TV. No wonder the market doesn't want to miss out on anything here.
Johanna: Basically, these technologies are fostering a fusion of the digital world with the real world. All developments that create an even more immersive experience for the user contribute significantly to success. And I think we've reached the point where it’s inevitable to deal with the topic, because the advantages of the medium are becoming increasingly clear. Companies are also beginning to explore new digital possibilities. For the most part, XR technology is being integrated into many companies, for example for video game development, Street View, or even prototyping. However, the step toward digital upselling via virtual spaces or the future metaverse is currently only being ventured by the big players. However, it will soon become crucial for companies to specialize in the metaverse and position themselves accordingly.
Sabine: Another emerging trend that is closely related to the metaverse are NFTs, or non-fungible tokens. Especially in the art world, you hear the term a lot. I've heard or read about NFTs over and over again in the context of buying NFT art and making a lot of money. Could you give us a little more context?
Johanna: NFT, as you said, stands for non-fungible token. They are unique assets with no substitutable equivalent token or currency. To also briefly touch on the technical background, NFTs are based on blockchain technology. A blockchain is a type of database where the information is structured in blocks and saved in different computers (nodes) at the same time, while information from each computer is permanently and stringently traceable. For general understanding, NFTs can be fundamentally viewed as a kind of digital title deed. In the context of the metaverse and blockchain technology, they form the cornerstone of ownership, enable the monetization of the metaverse, and promote an open and fair market economy.
Sabine: And what exactly is the future of the metaverse going to bring us?
Johanna: The metaverse is designed to create a second or new reality by merging the virtual world, augmented reality, and the physical world. It’s a vision of a boundless virtual space that should also be built like an ecosystem. The metaverse is supposed to offer users extended interaction possibilities, which are unimaginable in the real world. Users will be able to move around in a virtual space, in real time, with their digital identities and communicate, shop, work, and "live" there. And to make this life as realistic as possible, virtual reality glasses are being increasingly used. This makes them a key technology of the metaverse.
Sabine: Okay, quite a few things are already possible today. Microsoft, for example, has introduced Mesh: a kind of office in a virtual space. Meta has created so-called workrooms, among other things, and is now working on an all-encompassing metaverse that integrates many areas of everyday life. And companies like Kaufland, Walmart, Adidas, Nike, and others are already marketing in the metaverse and selling products there - mainly as NFTs.
Johanna: In retrospect, since the nineties, companies and investors have been trying to develop a digital world as described in Neal Stephenson’s book. An early, still very limited example of a practical implementation of the metaverse was the computer game Second Life, released in 2003. Today it’s also called the prototype of the metaverse. Basically, it’s a user-designed virtual world in which people can interact, play, trade, and communicate through avatars. Over time, the development was significantly shaped by the gaming industry, where metaverse-like environments were created by large game manufacturers on platforms such as Roblox, Decentraland, The Sandbox, or Epic Games, to name a few. These are available today and concerts and film premieres are held there, for example. As a result, millions of viewers have already been attracted to these digital venues.
Sabine: This reminds me of ABBA's digital resurrection that's what you mean, right? But what about all the information that I must bring into the metaverse if I want to join this trend? The avatars, the virtual products, and the offerings must come from somewhere. Isn't the metaverse just another channel in the omnichannel context?
Johanna: In principle, yes. Brands that already offer their products via different channels know this: I must adapt the information about my offer to the respective platform and distribute my data in the appropriate format. Within my bachelor's thesis, however, I looked further into the different channel strategies and a completely new model will be added to these strategies in the future.
Sabine: In other words, metaverse marketing must be based on augmented reality and virtual reality, focus on the user, promote interaction, and be platform independent. How can I meet these requirements as a brand today?
Johanna: It depends on the status of your marketing activities. But beyond that, you should also pursue innovations in content marketing. One option is to extend your social media marketing strategy to the metaverse. But beware, if you build out a virtual 3D infrastructure in the metaverse, you'll end up moving your social media communities from Facebook, Instagram, and the like into the metaverse as well. The social media marketing strategy is just a first step to get started in the metaverse. Your brand then must continue to develop the virtual space together with the users.
Sabine: But to do that, content has to be brought from the two-dimensional to the three-dimensional world. Texts don't work in the metaverse.
Johanna: But 3D graphics, animations, and digital applications do. The same applies, of course, to products that are to be sold exclusively via the metaverse. We've already talked about non-fungible tokens (NFTs) or tickets for digital concerts.
Sabine: On the internet and in the metaverse, there is also the link between order and delivery in the virtual and real worlds. I can order virtually and have the product delivered to my home in real life. This reminds me of the film Valerian and the City of a Thousand Planets. A science fiction film by the French director Luc Besson based on Valerian and Laureline, a French comic book series whose first story was published back in 1967. It mentions a huge cross-dimensional bazaar that you can only access by wearing a special helmet. The purchases made there can be delivered in the real world. But back to the here and now, product information needs to be appropriately adapted and enriched for the metaverse, because enriching product data improves the quality of the data and enables a 360° view that includes product descriptions, digital assets, bundles, upsells, and more. With comprehensive content today, you can already interact with your customers, engage them, and build a relationship.
Johanna: Data is definitely an issue and the more structured you already have your information, the faster and more secure you can use it in the metaverse. Consistent product experiences create trust, and that is no different today. The customer journey is usually non-linear and typically combines multiple offline and online touchpoints — including print, websites, mobile apps, social media, and marketplaces. If product content is incomplete or inaccurate or says something different on one channel than it does in another, it can be quite confusing for the end customer. This leads to mistrust and ultimately to sales loss.
Sabine: And nobody wants that. But that also means strengthening loyalty and preserving individuality, even when addressing the metaverse.
Johanna: Absolutely. Personalization continues to play a significant role in the metaverse. Therefore, personalization strategies should be looked at here as well. Integrating AI into a metaverse can help companies tailor content to users here as well. Many platforms already offer such AI integration. Personalization also means giving users the opportunity to express their own personality digitally. A classic example is the individualization of avatars.
Sabine: Which brands can then reinforce again with avatar accessories (such as jerseys from their favorite sports teams, etc.)
Johanna: Depending on the industry and product, you can also work really well with influencers. Influencers are already a key factor in marketing outside of the metaverse that should not be underestimated. With the transition into the virtual space, brands should consider working with digital influencers and thought leaders and evaluate possible collaborations. Thought leaders can, for example, contribute to the community with information and exciting content in a certain topic area.
Sabine: So we can summarize: The metaverse will, most likely, be a game changer for communication and marketing. It’s therefore crucial to start looking at all the possibilities in the virtual space now and to think ahead about strategies for metaverse marketing. What would you recommend companies approach the topic?
Johanna: The development of the metaverse will continue, but until then, there are some underlying technical elements that need to be addressed. However, the metaverse promises so much potential that companies or even private individuals should already start looking into the topic. Even if the metaverse may not yet offer any strategic advantage for your own company, you should equip yourself with the necessary know-how.
Wrapping up
The metaverse offers endless opportunities for businesses to engage with customers in immersive and innovative ways. As the metaverse landscape evolves, brands will need to stay up to date with the latest trends and seek ways to incorporate the metaverse into their overall marketing and business strategies. But the true potential of the metaverse lies in the hands of its users, who hold the power to shape a more exciting successor to the internet than any science fiction novel could predict.
