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Always looking for new growth levers, many companies are interested in the metaverse, which is often presented as the new generation of the Internet. These virtual worlds, although in their infancy, offer many opportunities for brands.
Not a day goes by that we don’t hear about metaverses or NFTs (“non-fungible tokens”). It must be said that these new technologies, derived from blockchain, have the potential in the coming years to profoundly disrupt all sectors of activity with which consumers interact on a daily basis. According to a report published by Gartner in February 2022, 25% of people will spend at least an hour every day in these virtual worlds by 2026. Some will work there, others will shop there, find friends theirs, they will have fun there, you will take lessons there, or all these things at the same time. Depending on different estimates, this market could generate between 1,500 (Gartner) and 5,000 (McKinsey) billion dollars in 2030. A windfall that companies of all sizes will undoubtedly want to take advantage of.
What is a metaverse?
Metaverse is a 3D virtual space, shared and continuous, accessible on the Internet. Simply put, it’s a parallel digital world to the one we live in that keeps spinning even when we’re not connected. It is therefore a digital counterpart of our physical and daily reality, accessible through any internet-connected device (smartphone, tablet, computer, virtual reality headset, etc.).
Metaverse is often referred to as Web3 as the next generation of the Internet. If the tech or gaming giants are already offering their visions of a centralized metaverse, like Meta with Horizon Worlds, decentralized platforms like The Sandbox or Decentraland are in the process of operating a real revolution. In the absence of a controlling entity, these universes are controlled by their own users, who make decisions through DAOs (Decentralized Autonomous Organizations). In practice, holders of tokens issued by a platform can vote on any decision that affects the future of its metaverse.
In addition to DAOs, decentralized metaverses rely on NFTs, which introduce the notion of ownership over digital assets. They make it possible to hold virtual objects or land, which offer their holders a host of advantages. Owners of digital objects can, for example, access certain experiences that are reserved for them, while owners of land in the metaverse can set up their business there, or provide an experience there for users (treasure hunt, platform, etc). This decentralization is also based on the use of cryptocurrencies for payments, with the aim of eliminating any trusted third party in transactions between users. In a metaverse, it is thus possible to sell or buy NFTs peer-to-peer, without any intermediary or control body.
A virtual world with endless potential
The Metaverse is currently just a world under construction with mostly unknown potential, but the big companies didn’t wait for it to mature enough to conquer it. This is also one of the strengths of the metaverse: all its users participate in its development. Brands use it in particular to experiment with new interactions with their customers. And they would be wrong to deprive themselves of it, because the investment it requires remains negligible compared to the benefits they can derive from it. We saw it especially with Nike. After creating its own space in the game Roblox, called Nikeland, the comma brand acquired the company RTFKT Studios in December 2021, which specializes in creating sneakers in the form of NFTs. He got it right because according to blockchain data analysis platform Dune Analytics, his virtual sneaker collection has earned him an estimated $185 million as of April 2022 (half during the initial sale, the other half thanks to royalties received from each resale of its NFTs). While Nike has taken a step ahead of the competition, most brands in the world of luxury and fashion are struggling to keep up. Among the companies rounding out the top 5 in revenue generated by NFTs are big names in the industry: Dolce & Gabbana, Tiffany, Gucci and Adidas.
The Metaverse, and all related technologies, display a potential whose limits are unknown. The most obvious use for companies is to facilitate remote collaboration by offering, for example, more immersive virtual meeting or conference rooms than with the tools currently used. Some companies also use it as a marketing tool to reach younger generations, to show that they are at the forefront of technological trends or to stimulate the engagement of their customers by offering them new digital experiences. Other brands even merge the real and virtual worlds. This is the case with Leader Price, which earns coupons in The Sandbox metaverse that can be used in its physical stores. In the same logic, one can imagine shopping in a virtual store before taking their purchases home. Beyond its ability to unlock new revenue streams for businesses, metaverse offers an endless array of possibilities in terms of marketing and customer experience.
Fear of the unknown
If the metaverse holds great promise for businesses, we shouldn’t get carried away either. This is a very recent technology, for which we do not yet know all the risks. Speculation remains strong there, with NFTs whose interest is hard to fathom. But above all, these technologies speak for the moment only to a minority of individuals. For companies entering this sector, it is therefore a bet on the future.
To hope for mass adoption of the metaverse, it will also be necessary to secure these spaces and the transactions that occur there, in order to reassure companies and consumers. Indeed, according to a poll conducted by Ifop for Talan, published in January 2022, 75% of French people express fear in front of the metaverse. This is where companies from traditional finance have a role to play, as explained by Olivier Gabrielli, head of innovation and new payment solutions at Mastercard France: “Our goal is to support companies in their approach to innovation and bring the trust and security we guarantee for card payments in the fields of cryptocurrencies, NFTs and metaverses Mastercard is convinced that metaverse and blockchain technologies will become essential tools for businesses and the general public.
The payments giant has even decided to make it the theme of its upcoming Innovation Forum, which will be held inside the Stade de France on December 8. Among the speakers invited by Mastercard to shed light on its partners and customers, we find Sébastien Borget, co-founder of the metaverse The Sandbox, or Lindsey McInerney, who created the entertainment company Web3 Sixth Wall with actress Mila Kunis. While you wait for the arrival of the metaverse, you can follow this web 2.0 event through Mastercard’s social networks.
“3 questions for” Geoffroy Seghetti
Marketing and Communications Director for Western Europe at Mastercard
HBR: Why is it important to show that Mastercard is involved in the topics of Web3, metaverse, NFTs, blockchain and cryptocurrencies?
Geoffroy Seghetti: Mastercard is a company specializing in the development of payment technologies. We create new services and solutions for the actors of this ecosystem. Therefore, we study all innovations and their potential, to support new uses, guaranteeing safety and confidence for our customers. As such, we are developing and testing Web3 technologies to provide consumers with more choice in their means of payment. That’s why we’re building bridges between the traditional payment ecosystem and the cryptocurrency ecosystem, ensuring access and security for consumers.
What can these technologies bring from a marketing point of view?
These technologies are developing rapidly. To use them correctly, you must first understand them and appreciate their potential. This is what we have been doing for many years for artificial intelligence and blockchain. When it comes to the metaverse, no one can predict when it will reach its full potential, but there is little doubt that it will grow in importance in our personal and collective lives. What is clear is that it will have an impact on how we interact with consumers. We already know that in the metaverse, advertising and marketing will not be content with a simple, sticky copy of current formats. They will need to be reinvented to be relevant and integrate naturally into this new immersive environment. We are only in the first phase of what will be a tremendous evolution for our interactions in general.
You seem very optimistic about the future of Web3 and all the technologies that accompany its deployment…
We live in a time of stimulating innovation cycles. The digital ecosystem continues to bring new opportunities for companies, but also for the general public. Metaverse, NFT and blockchain offer new playing fields that open up even more possibilities. We’re not done hearing about it.
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