Even as brands have made a dash to cash in on what seems to be a frenzy called, ‘the metaverse’, sustainability still remains questionable. “The global e-commerce industry is predicted to grow by 16.8%, to $4.921 trillion, in 2022. As the metaverse becomes embedded in our daily routines, there will be an increase in Direct-to-Avatar (D2A) purchases, and, for all consumer-catering industries, purpose-oriented integrations with the digital world will have to be emphasised,” Anshul Agarwal, co-founder, and director, XR Central, metaverse technology company told FE Digital Currency. 95% of business leaders expect a positive impact of metaverse on their industry within five to ten years, as reported by Mckinsey and Company.
According to industry experts brands appears to constantly reinvent engagement strategies to sustain in the metaverse. ” The metaverse can optimise engagement through experiences, monetisation, localisation, and customisation. It is important to create a strong return-on-investment (ROI), particularly when it comes to large investment opportunities,” Manasa Rajan, CEO, Jupiter Meta, an integrated Web3.0 entity, said.
The report by Mckinsey and Company further stated that of all the potential drivers of the economic impact of the metaverse, e-commerce is the largest. It has been estimated it may have a market impact of $2 trillion to $2.6 trillion by 2030.
As per industry experts, hybrid approach followed by brands seems to have worked in their favour. “Brands have combined time-honoured brand strategies with new, immersive techniques to create a strong response from customers,” added Agarwal. Likewise, Procter and Gamble created realistic skin types and conditions (eczema, moles) on Avatars on Animal Crossing to highlight the ‘My Skin, My Way’ campaign run by its brand, Venus.
However, Consumer Packaged Goods (CPG) brands which are deeply rooted in physical consumption, continue to face challenges. “The levels of awareness about digitally connected universes are still low and there are still many top-level executives who continue to feign ignorance about the prowess of metaverse platforms to change the rules of customer engagement,” Tushar Gandotra, Co-founder, and CEO, FiEx, said.
Not to mention the cost of devices is very high, which acts as an impediment. According to Agarwal, the Oculus Quest 2 is the latest iteration of the Facebook (now Meta) powered Oculus VR headsets and retails for about $300. “A fully decentralised metaverse with limited users and rooms costs an estimated $15,000-20,000 a month. The cost additionally varies depending on metaverse features,” Shrikant Bhalerao, co-founder, Seracle, a Singapore-based blockchain, and digital assets company, added.
Industry experts noted that brands currently rely on digital to expand reach especially, incase millennials and Gen-Z. “Marketing is more of a distribution game today, and tapping into the digital world is a gate pass to early mover advantage,” Bhalerao added.
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