To some, it might seem that metaverse is a new buzzword. But with organizations from all sectors rushing to announce new virtual offerings, from Prada’s virtual winter sports line to Disney’s announcement that the metaverse is ‘top of mind’, it’s clearly a big deal.
While the metaverse could be a valuable tool for engaging customers and opening up new revenue streams, organizations need to be wary when launching into the metaverse. An approach that is not led by a clear strategy to improve customer experiences may leave businesses open to criticism that they just want to turn a profit rather than create offerings that have been genuinely designed with customers in mind or for improvements to an organization’s functionality. This kind of backlash might prove disastrous for businesses, so a careful strategy is essential.
The metaverse can’t just be about businesses earning quick extra revenue when it comes to their offerings within virtual worlds. Organizations must instead focus on providing customers with new and improved environments and interactions that enhance the overall customer experience. Otherwise, businesses would risk criticism that they don’t care about their customers, which could ultimately lead to a brand being damaged and seeing a lack of trust from their targeted market. We have seen this in the gaming industry, where players reacted badly to Team17’s decision to offer NFTs (non-fungible tokens), feeling that the company was just trying to make some extra revenue. To avoid this, organizations might offer customers exclusive rewards or experiences in the metaverse that they wouldn’t have access to in the physical world, such as limited-edition merchandise or the opportunity to attend exclusive virtual events.
Rewards such as these can be unlocked or facilitated by NFTs, which cannot be replicated or forged within the digital universe. They could be offered to consumers as a reward for virtual interactions with a brand or organization or as exclusive collectibles. It’s something we’re seeing within the luxury goods space already. For example, Gucci auctioned an NFT artwork inspired by its Aria collection, which lets customers feel closer to the brand, creating long-term value.
Businesses might feel tempted to jump onto the bandwagon when it comes to the metaverse, but with no clear strategy in place or no consideration for a long-term plan, the ROI could be compromised, particularly when it comes to building a lasting solution that truly engages the customer base. Without a plan, organizations might fall into the trap of wasting vast amounts of time and resources on their metaverse strategy or initiatives, which would only succeed in the short-term if it does not fully engage their customers and focuses on quick revenue injections over long-term plans or leaves them open to criticism that they are just adopting a trend, rather than undertaking serious business decisions.
It is essential, then, for organizations to create a dedicated metaverse strategy if they want to take full advantage of the metaverse. It should include a plan for how they can utilize innovations in web3 and metaverse technology to improve the customers’ experience and create additional value on an ongoing basis.
One of the best strategic approaches that businesses can take is pairing metaverse platforms with exclusive NFT offerings. NFTs truly are key to the metaverse, as they will act as the currency of the virtual world. In addition to adding long-term value for customers by giving them access to exclusive collectibles, adopting a combined metaverse and NFT strategy means companies can use NFTs in the virtual world to their full potential, as opposed to jumping on the bandwagon and missing out on future benefits. For instance, fashion brands could create additional revenue streams and opportunities through NFT ‘wearables’; a certain type of NFT that can be purchased by customers and then worn by avatars within the metaverse. Some luxury brands have already taken advantage of this type of NFT – Balenciaga previously launched a collection of outfits in Fortnite that players can purchase to have their avatars wear in-game. Organizations can also create further value for customers with ‘wearable’ NFTs by attaching personalized rewards to them. This could be something like having a buyer’s name included on the piece; for example, a sports jersey with a player’s name on the back, which could create new revenue streams for brands, with the potential to engage new audiences across the metaverse.
Digital environments and NFT platforms have the potential to engage consumers in new and exciting ways. This is something that we’re particularly seeing in the sports business nowadays. For example, the owners of Manchester City are building a virtual version of the Etihad stadium. But relying on just one platform or environment can pose a risk for businesses. If you put all your eggs in one basket, it could end up being a problem down the line, and you may struggle to reach the desired customer base by utilizing just one platform. Instead, businesses can integrate with or utilize existing platforms to expand their reach to new audiences and markets.
There are already a number of virtual worlds and different platforms with established audiences that can be utilized by brands looking to enter the metaverse. Brands will need to evaluate what is available and decide on the right platforms to use, making decisions based on a dedicated strategy.
Organizations seeking to harness the metaverse have an opportunity to take the lead with this new technology, but without forward planning, they will risk losing out on its full potential. Avoiding the concerns outlined above can help businesses to ensure their metaverse plans are future-proofed and have real appeal to customers and fans alike, improving the experiences for both new and existing customers.