These days, it seems like every big corporate player wants a piece of the metaverse, and it’s easy to see why. Many have described it as the “next iteration of the internet”, with predictions that it’s about the disrupt our entire corporate landscape as we know it. The numbers would seem to support that story:
- The market is expected to go from $46 B in 2020 to $800 B by 2024
- The Metaverse gaming market is set to reach $400 B by 2025
- The global AR, VR and MR market is expected to reach $300 B by 2024
And those are just the “conservative” ones. According to crypto investment firm, Grayscale, the metaverse might eventually bring in up to $1 T in annual revenue through advertising, digital events, e-commerce and hardware sales. The race has already begun, with big corporate players positioning themselves to get a piece of the action:
- Alphabet recently bought North, a startup that makes lightweight AR glasses.
- Sony has invested $200 M in its metaverse efforts so far.
- Microsoft is all in, with Microsoft Mesh, its HoloLens headset, and its purchase of Activision Blizzard for $69 B.
- Meta is spending $10 B to build its version of the metaverse “Horizon Worlds”.
With readily available tech resources to build it and more people than ever ready to jump in (see the first article in our metaverse series), the market is ripe for the taking - it’s just a matter of seizing the opportunity. With that goal in mind, we’ve outlined ten ways corporations can leverage the metaverse to future-proof themselves against disruption and create valuable revenue streams.
1. Advertising, marketing and virtual showrooms
As more people enter the metaverse, its potential as a place for companies to advertise and showcase their offerings will only increase. You can expect it to be as overrun by ads and marketing campaigns as the internet is today. Except that in the metaverse, things will go far beyond your typical YouTube ad, 2D Billboard, or email drip campaign.
Some companies are already coming up with brilliant new ways to feature their products, boost their brands and reach their target audiences. Warner Brothers, for example, recently created an immersive metaverse block party experience to hype its “In the Heights” film. It simulates the neighbourhood in the movie and does a pretty nice job of bringing its music, dance, and Latin American culture to life.
And then there’s Wendy’s, who took metaverse advertising to a whole new level during Fortnight’s battle royal event between “Team Pizza” and “Team Burger”. After creating an avatar on Twitch, they dropped into the game, not fighting other players but destroying virtual freezers. The goal? To promote how the company famously “Doesn’t do frozen beef”. The shenanigans went on for nine hours in which top gamers (and their massive followings) jumped in, promoted the mission on Twitter and helped destroy quite a number of virtual freezers. Kudo’s to Wendy’s for its metaverse marketing genius.
These are just a few of the ways companies can market themselves in the metaverse:
- Virtual billboards in metaverse areas frequented by your target audience.
- Product placement within popular metaverse games (e.g. branded in-game items).
- Digital humans or AI-powered avatars that can interact with potential customers.
- Full-scale immersive experiences where customers can interact with your brand.
2. Virtual customer experiences
Providing customers with unforgettable experiences is a priority for most businesses. It helps differentiate you from the competition, boosts loyalty and increases the value of your brand. Now imagine if you could design an experience untethered by the constraints of the physical world. The possibilities are endless!
Here are a few examples of brands that have found new ways to monetise brand experiences in the metaverse:
In May of last year, Gucci partnered with Roblox to create its Gucci Garden metaverse experience, the virtual counterpart of a physical Gucci installation in Florence. Visitors got to explore the virtual space (with rooms like “urban romanticism” and “Tokyo tribe”) as neutral mannequins, with no gender or age, which was a sort of metaphor for how we begin life as a blank canvas. During the event, Gucci sold a digital version of its Dionysus Bag for 350.000 Robux or $4.115 (more than it costs in real life).
NASCAR also teamed up with Roblox to reach a younger cohort. Part of its strategy involved launching a customised digital car on the platform’s “Jailbreak game” and selling clothing for its player's avatars. The experience also involved a fan contest where players could design their own NASCAR uniforms and have them judged by the game’s developers. A great way to boost the brand among younger players.
AB InBev’s Stella Artois (a common horse racing sponsor) took things to the next level by teaming up with Zed Run to create an experience where players can breed, raise and race digital horses. The horses could even have Stella Artois-themed skins. It was a great way to excite their fan base, and some horses were sold for over $150.000.
3. Real estate
Believe it or not, metaverse real estate is a hot commodity right now, especially on platforms like Decentraland, The Sandbox and Axie Infinity, where virtual plots (i.e. NFTs) are selling for millions of dollars (a plot on Decentraland recently sold for $2,4 M). And the number of interested buyers is on the rise.
People are basically investing in the future of specific metaverse worlds, targeting areas they feel will eventually go up in value (just like in real-world real estate) - and sometimes those bets pay off. For example, after Snoop Dogg started developing his “Snoopverse” on The Sandbox, someone paid $450.000 to be his metaverse neighbour.
Here are just a few of the ways companies can make money off virtual real estate:
Metaverse real estate flipping
Much like real-world real estate flipping, this consists of purchasing virtual plots or properties and making a profit from re-selling them later (for a higher price). For example, Atari recently sold its plot of virtual land in The Sandbox to Republic Realm (a metaverse real estate firm) for $4.3 M. One of the most expensive metaverse real estate deals to date.
So, if people are buying these plots, who’s selling them? That’s right, virtual real estate companies like Metaverse Property. You can make some pretty sizable commissions providing expertise or simply connecting buyers and sellers.
Once you buy a plot of land, you can build on it and rent the property out to other businesses. If you have a building in a commercial or high traffic area, you can even advertise on your property.
Virtual property management
Once you have a bit of experience with virtual properties, you can start making money off your expertise, providing advice on how to best use a piece of land or overseeing how the property is used.
4. Fashion, v-commerce and D2A
Just like in the real world, having a unique visual identity is important in the metaverse, where we’re represented through avatars. In fact, according to a global study by the Institute of Digital Fashion, 92% of people report that customisation is important when creating virtual avatars. People will customise their avatar by controlling its gender, body type, and, of course, its fashion. This has given way to a new direct to avatar (D2A) market, and retailers and fashion players are already exploring it. Some of the benefits of D2A include no overstock, fewer production delays and higher profit margins.
For example, retailers like Nike, Hello Kitty, and Walmart are selling virtual goods in the form of NFTs. Luxury fashion brands like Balenciaga and Ralph Lauren are already dressing people in the metaverse (or their avatars). In addition, many brands and retailers are leveraging the metaverse to sell actual items (e.g. you try it out in the metaverse, order it and have it sent to your real-world door).
Here are just some of the ways fashion brands and retailers can tap into v-commerce (virtual commerce) and the D2A market:
Partner with platforms that cater to your target market
Existing platforms have built-in audiences, making it easier for you to reach the people that will want to buy your virtual clothing and accessories. You can do things like create in-game items or sell your virtual creations on open virtual marketplaces.
Experiment with augmented reality (AR)
Augmented reality enables customers to visualise how clothing and accessories will look and feel in real-time. In fact, 61% of users report a preference for AR shopping experiences. So, make sure to incorporate it into your shopping experience if possible.
Turn your creations into non-fungible tokens (NFTs)
If the virtual apparel you sell is in the form of an NFT, your customers will be able to trace its production and authenticity. This can raise the value of your virtual products and, in some cases, provide you with some nice royalties. For example, Coca-Cola launched an NFT collection that made $575.000 in an online auction.
5. Education and training
The e-learning industry has skyrocketed during the last decade, surpassing $250 B in 2020, and it’s expected to reach $1 T by 2027. More people than ever are attending online classes, checking out video tutorials, reading “how-to” articles and honing their skills on apps that turn learning into games. While this may be cutting-edge at the moment, more immersive and gamified experiences in the metaverse can potentially make what we’re doing now seem outdated.
Imagine a history lesson where you could travel back in time and experience the renaissance or ancient Egypt up close. Seeing a 3D representation of a particle or physics lessons that show you what every formula represents as opposed to just hearing a professor drone on in the typical “if a ball is flying through the air at X speed, then…”. Within the metaverse, there are no physical restraints, opening up endless possibilities for fun, gamified and highly engaging learning experiences - that will probably be a lot more effective.
Companies are already investing in the idea:
- Roblox recently announced a $10 M fund to boost online learning experiences.
- Microsoft’s Mesh for Microsoft Teams facilitates virtual learning for companies.
There are plenty of opportunities for companies to make money in this sector:
- Building the hardware that facilitates the experience
- Creating new metaverse learning environments.
- Building up their own internal learning academies to better equip employees
6. Virtual travel and tourism
What if you could go to your favourite vacation spots without the hassle of the airline, the jetlag or the extra covid testing? People are already doing it using VR - and not just to locations you can actually visit, but to created places (e.g. fictional lands, different time periods, etc.).
The metaverse will be the next iteration of that idea, enabling people to visit any place they want and have realistic experiences, probably at a fraction of the cost. This has the potential to revolutionise the industry, creating an endless number of opportunities for companies in the travel space.
But let’s face it, we’re nowhere near having the technology that would offer the same experience as actually visiting a location - so metaverse travel won’t be completely taking over any time soon. However, here are some of the ways it will impact travel and tourism in the near future:
Customers are much more inclined to buy a travel package, book a hotel or purchase an airline ticket if they can “test drive” the experience beforehand. Hotels could showcase their facilities; airlines could give customers a glimpse of their destination and travel agents could showcase different experiences they want to sell - think of it like a movie preview, but for travel.
Metaverse experiences will be a great way to give customers a taste of what they’re buying, giving the companies that provide it a competitive advantage.
Imagine booking a travel package that comes with its own VR headset to access the metaverse. So, if you’re lost in a new city, you just put on the headset and ask your metaverse guide for help. Perhaps you need tickets to a local show or reservations to a restaurant you want to visit? Just talk to your metaverse concierge, and he’ll hook you up anytime.
7. Virtual events and concerts
In 2019, we already started to see the first successful metaverse events, like Fortnite’s Marshmello concert, which boasted 10,7 million attendees. In 2020, we saw Travis Scott make his metaverse debut in a concert attended by 12,3 million and reportedly made him $20 M.
Since then, musicians like Justin Bieber and Ariana Grande have made millions through virtual events and concerts.
As the metaverse continues to evolve, you can expect to see significant improvements in graphics, avatars and hardware - making the experiences even better than they are today. For example, more advanced headsets might provide surround sound to give you that “in-concert” feeling or enable you to look over and see your friends singing along with the music.
As these metaverse events, concerts, festivals and parties continue to become more popular, they’ll give way to a slew of opportunities for companies to host, sponsor and create the experiences. Advertising in the right event will be an effective way for companies to catch the eye of younger audiences.
8. Metaverse games
From the beginning, it was clear that gaming and the metaverse were inextricably linked. It’s therefore not surprising that a lot of companies are using games to get their proverbial “foot in the door”. Many companies see it as a way to reach new audiences. Here are just a few examples:
To mark its 200th anniversary, Louis Vuitton launched a puzzle adventure game called “Louis The Game”, where players can find and collect NFTs. Players can journey through six colourful locations to find the game’s 200 collectable candles.
In September of last year, Hyundai launched its own game in the Roblox metaverse: Hyundai Mobility Adventure. As described by Hyundai Executive Vice president and Head of the Customer Experience, Thomas Schemera:
“To build innovative relationships with young people, we will strengthen our virtual customer experience content for familiarizing them with Hyundai Motor’s new vehicles and future mobility solutions on Hyundai Mobility Adventure.”
9. Helping to build the metaverse
Architecture and design firms are already using their capabilities to build structures and decorate spaces in the metaverse. Voxel Architects, for example, makes up to $300.000 per project, designing real estate in the metaverse. In the metaverse, these construction firms will probably be the next generation of website developers.
The metaverse is still in its infancy, which means there are plenty of great opportunities for corporations that want to contribute to building it. Here are just some areas you could focus on:
- Infrastructure: Providing connectivity tech, like 5G, Wi-Fi and GPUs.
- Hardware: Making headsets, AR glasses and haptics to heighten user experiences.
- Helping to connect metaverse worlds through blockchain, AI, edge computing, etc.
- Spatial computing, including 3D visualisation and modelling frameworks.
- Supporting the creator economy with design tools and digital assets.
- Facilitating discovery with ads, social media, ratings, reviews, etc.
- Creating your own metaverse experiences.
10. Testing products and services on the metaverse
As the metaverse continues to evolve, a growing number of companies will need help testing their new offerings, finding users, and getting real objective feedback. New metaverse products will need to be looked at from a variety of angles, including:
- Performance: Does it do what’s intended?
- Usability: Is it intuitive?
- Quality: How good is the overall experience?
- Accessibility: Can it be used across different groups of people?
- Security: Is your user’s information safe?
This will create many opportunities for companies that specialise in testing metaverse products and services.
A brave new metaverse world.
As more people join the metaverse, lured by their favourite brand, artist, company or just good old fashioned curiosity, cryptocurrencies will become more ubiquitous - resulting in endless possibilities for businesses. Imagine a fully-fledged metaverse where:
- Amazon exists as a giant virtual mall you can walk through
- People can visit their Pfizer-powered “digital person” doctor for a check-up 24/7
- You can walk into your favourite Netflix shows and movies
A reality that might be closer than we think. For corporations, it all boils down to one inevitable conclusion: Adapt or risk getting left behind.
Are you a corporate innovator looking to explore new areas for growth? We can help you identify promising growth spaces beyond your core business, so you can diversify your portfolio and build valuable new revenue streams.