If you haven’t been living under a rock for the past year, and you’ve so much as seen the news or visited social media, then there’s a good chance that you’ve been met with a barrage of techno jargon, that seems not to make much sense at first, but also appears that it’s making people in the know a fortune.
Yes, people are actually milking digital cows and selling their “milk” for real money. Is it a trend? A crazy fad? Or the next chapter in the evolution of web technology and the customer experience journey?
If you haven’t figured it out yet, we are of course talking about Web 3 and the Metaverse. So, what’s it all about? NFTs, digital twins, virtual avatars? Web 3 can certainly be a confusing place at times.
Well, we’ll do our best to run you through the foundations, and whilst we’re in no position to predict the long-term future of the metaverse (if we could, then we’d be writing this blog from our 10-bedroom villa in Marbella) we certainly have a good idea of how brands can capitalise on the current landscape.
If you haven’t already, check out the recording of our Notepad founder Naeem Alvi, from our Linkedin live event on the subject, where he goes into far greater detail than we will here. Insightful, entertaining and well worth a watch / listen. Follow this link and the recording will be available.
Far from being some pie in the sky concept, Citigroup investment bank has predicted that the metaverse economy could be worth a staggering $30 trillion dollars by 2030, and with some of the world’s biggest brands getting involved, it’s easy to see why. If Visa, Unilever, Intel are all on board with NFTs and Web 3, should we be taking the plunge with them?
Well before we all get ahead of ourselves, starter for 10, what exactly is the metaverse?? According to Andrew Faridani, of the Forbes Business Development Council, “The metaverse is defined as an immersive digital environment populated by virtual avatars representing actual people.”
And this is all made possible by Web3. The latest Internet technology that leverages machine learning, artificial intelligence, and blockchain to achieve real-world human communication.
And whilst we’re at it, blockchain is a system that maintains records of transactions made in cryptocurrency and is linked to a peer-to-peer network.
So in this weird and wonderful place, what opportunities are available for brands to engage their audiences and make waves?
NFTs are great for luxury brands and collectables
An NFT, or non-fungible token, is a collection of data stored in a blockchain that proves ownership of digital assets. This could be a piece of art, music or even an item in an online game.
This ironclad proof of ownership vastly enhances the collectability of assets, as they can’t be stolen or reproduced. For decades, upmarket brands have understood how to market a product through scarcity, now this approach has found a new platform.
Rolex, Gucci and Hermès (that’s the fashion house, not the unreliable courier service) have already invested billions in NFTs, sensing opportunity in the metaverse economy and online avatars. A Macallan Whisky Cask NFT has even sold for $2.3 Million in October 2021!
Whether or not there is in fact any long-term intrinsic value in these online items, this is certainly another avenue for companies to explore that will feed the exclusivity of their brands and create a buzz.
New revenue streams and business models
The metaverse has created new ways for brands to incentivise their customers into taking desired actions. Trends such as “play to earn” or “watch to earn” are driving engagement with a brand, rewarding consumers with points that can be spent on physical products or on digital items such as NFTs.
Naturally, this encourages longer interactions with a brand, and also makes audiences more likely to purchase products in the future. This form of decentralisation also gives audiences a feeling of ownership in a brand that creates advocacy.
This could be the start of a new age in customer loyalty schemes for brands.
Preventing Fraud
Blockchain and NFT technology adds an extra layer of security to exchanges. This can be implemented into ticketing systems, utilising the technology and making tickets virtually impossible to clone or defraud.
QR codes have served as a good answer for event organisers, but they’re not that effective for the guests purchasing them. Customers can now verify the authenticity of the tickets through peer-to-peer blockchain before any purchase is even made. Unscrupulous scalpers everywhere are having sleepless nights at the prospect.
Tickets in NFT format can also act as digitable collectables for consumers, to be treasured, sold or traded, knowing that their souvenirs will stand the test of time. As someone who’s put the tickets from my two recent Wembley visits through the wash, this is definitely something I can get behind!
Giving physical products a digital twin
Digital twins are the copies of real, physical products or assets which can act as records of ownership, or an opportunity to interact with these products in new, exciting ways.
Drinks companies have been leading the charge in this space, giving their customers NFT supported collectors bottles, which can be stored in their virtual drinks cabinets. And in an unconventional twist, the twins attached to certain limited edition whisky bottles are now fetching over 50x the physical bottle’s RRP.
Now if this all sounds like a fad-driven, unsustainable bubble, I’d tend to agree with you, but the 3-D mapping technology used to create twins is being utilised in powerful ways.
Amazon has invested in technology that can make the digital twin of real physical environments. This includes buildings, transport links and even entire cities, allowing us to experiment with the impact of projects more extensively before carrying them out.
This real world, practical application of the technology shows that there are countless opportunities, just waiting to be explored by brands, and that Web3 technology is here to stay.
Adverts and marketing within the metaverse
Savvy brands are now plugging into existing meteverses, with large, established follower bases, seeking to engage their audiences through new means of advertising.
Vans have recently created a digital skatepark that you can explore within the Roblox metaverse. This is classic product placement but in a whole new dimension, whilst audiences are already deep within an immersive experience with neurons firing in their brains. Strengthening feelings towards a brand and recollection of these interactions.
Vans’ metaverse marketing also lends itself perfectly towards play to earn rewards for users, as discussed earlier. Where points earned by doing certain tricks can be spent on the Vans website – giving value to the experience and fostering further engagement with their brand. Absolute goldust for marketers.
To recap
- NFTs are good for luxury brands and collectables
- Play to earn is creating new revenue streams and boosting engagement
- We can use the technology to prevent fraud
- Digital twins are causing a stir, and the technology has real-world applications
- Advertising is taking off within the metaverse
To finish off, I’ll leave you with the closing words from Naeem’s live event, with his take on Web3 and the Metaverse, with definite cause for optimism, and also some sound advice!
While a lot of the Web3/Metaverse narrative is hype-driven nonsense, the move towards digital ownership and virtual brand experiences is happening. It won’t work for every brand, but if you have an in-demand product or service, there are some worthwhile opportunities for brands to jump on.
Just don’t turn off everything else you’re doing.
Follow us on LinkedIn and keep your eyes peeled for our next live event.
