A version of this story first appeared in Campaign Asia. Click here to read it.
Ever since Facebook rebranded itself as Meta and declared itself a champion of the metaverse, everyone wants to be part of the metaverse conversation.
Matthew Ball, author of The Metaverse, says the metaverse is the ‘fourth wave’ of computing: “It’s about being always online rather than always having access to an online world.” This vision of an always-on world has exciting implications for how we might live, work, and play in the future.
Many brands are eager to get in the metaverse game for a head start on the next digital frontier. At present, however, the metaverse is still a concept in its infancy. There remain many grey areas that brands must first do their due diligence on to decide whether they should make a metaverse play now, or whether waiting is the smarter choice.
Broadly, we understand the metaverse as a convergence of our digital and physical lives. It is a world where both of our existences will carry real importance.
By 2026, Gartner says, a quarter of us will be working, studying, shopping and socialising in the metaverse for at least an hour a day. It will have a ‘virtual economy’, which will include digital currencies and non-fungible tokens (NFTs), to buy, own and sell digital or physical items online. The metaverse technology market alone is already projected to hit US$224 billion by 2030 — to say nothing of the revenue opportunities it will create for companies across sectors.
Unsurprisingly, we are seeing brands experimenting with new metaverse experiences to establish first-mover advantage in what could be a very lucrative new space.
Last year, Hyundai launched its Hyundai Mobility Adventure metaverse space in Roblox, an online entertainment platform and metaverse frontrunner, to showcase its products and future mobility solutions. Recently, Meta launched an online store for Facebook, Instagram and Messenger users to buy digital clothing for their virtual avatars — and luxury labels like Prada and Balenciaga already have designs for sale on it.
Other brands are choosing to dip their toes in first by buying digital land — despite prices skyrocketing by as much as 500 percent. In January, consultancy giant PwC bought virtual LAND in The Sandbox, a blockchain-based 3D open world game. Sportswear leader Adidas and gaming brand Atari number among PwC’s neighbours; the former aims to build exclusive content and experiences, while the other plans to build a virtual theme park with a unique digital economy.
With everyone seemingly hopping on the metaverse train, it is natural for brands to worry about the potential opportunity cost of not following the crowd. It does not help when they are being bombarded by a myriad of articles and podcasts touting metaverse strategies and best practices for brands. But as far as I’m concerned, it always comes back to authenticity.
Brands are used to deciding what platform to advertise and engage on based on where their audience is, as well as which is more authentic to the brand’s image.
An apparel brand for young adults may create trendy TikTok and Instagram video content to appeal to the younger demographic, while brands focusing on mass market appeal may have more outdoor advertising and TV ads to get as many eyeballs as possible. Deciding whether to participate in the metaverse requires similar considerations.
Brands need to think about:
Clubhouse’s meteoric rise and fall is an excellent example of why brands should not jump on trends for the sake of it. I am not saying this will happen for the metaverse, but the lesson remains relevant. At this point, we still do not know what the metaverse will even look like — what we are being sold now in the fancy teaser videos are still concepts and fantasies.
Brands that do decide to take the plunge must approach the metaverse as its own platform. They cannot hope to simply transplant a social media campaign into the metaverse — they must experiment, prepare for a lot of trial and error, and build things organically and in real-time. The key is always to focus on the storytelling — that has never changed, regardless of medium.
Another aspect that brands must not forget when it comes to the metaverse is the question of ethics. For the metaverse to achieve popularity and longevity, it must be safe enough for people to interact, purchase, engage and invest in it comfortably. Unfortunately, we are not at that stage yet.
For a long time, the business model of Web 2.0 (our current iteration of the Internet) companies revolved around speed and profit: in fact, Facebook’s mantra was ‘move fast and break things’ until 2014. As a result, ethical standards and enforcement could not keep pace. Facebook is infamous for its inadequacy in dealing with ethical issues around data usage and collection, as well as its opaque content moderation standards. It may have a new name now, but its problems remain.
Brands in the metaverse cannot afford to ignore the ethics question. Already there are numerous accounts of virtual harassment in the metaverse, ranging from virtual groping to more violent behaviour. Meta’s latest answer was to institute a four-foot ‘Personal Boundary’ between avatars in its Horizon Worlds VR experience, but this seems reactive and insufficient.
“Designing mechanisms for ‘doing better’ is not beyond an ecosystem that is responsible for designing a virtual world in the first place.” — Mark Read, CEO of WPP
The real-time nature of the metaverse also works against it here. It will be extremely challenging for brands to monitor and regulate at speed — especially given the lack of satisfactory moderation standards in today’s Web 2.0. Managing information privacy and user safety is another question; how will brands protect both users and their sensitive data, and what is the scope of their liability?
No one has the answers yet, but finding them must be top priority for brands seriously considering making a metaverse play.
The technology and the possibilities of the metaverse excite me. If the metaverse does succeed in cementing itself as a cornerstone — if not the nexus — of Web 3.0, then the question will not be whether brands should participate in it — it will be when.
If done well, the metaverse will provide brands with a huge opportunity to create new and immersive experiences for consumers, as well as pioneer new forms of engagement. However, we cannot also ignore its dark side.
The metaverse is presented as a new, decentralised Internet experience, but it is still driven by large businesses that focus on growth and profit — many of them the same ones that have shaped our Internet experience today, with all its features and flaws. Content moderation and digital addiction will both be huge issues that the ecosystem must tackle as a whole for effective and positive change.
With everyone hopping on the metaverse train, it is natural for brands to worry about the potential opportunity cost of not following the crowd. But as far as I’m concerned, it always comes back to authenticity.
What we have now is the relative advantage of time. With the metaverse still in its infancy, brands have some space to plan proactively instead of trying to play catch-up.
Decision-makers must tackle these difficult but necessary questions now about the suitability of the metaverse for their brand, as well as the ethics and regulations that it must uphold for them to participate productively. Joining the metaverse should be an informed, planned choice, not blind bandwagoning or as a last resort.
Ultimately, my advice to brands is: always look before you leap. Do not get dazzled by the metaverse hype. Stay focused on the story you are trying to tell and who the audience is that you are trying to reach. Those are the most important — no matter what universe you are in.