At a glance, businesses are looking to the metaverse to:
- Enhance consumer/user experience
- Develop and market virtual products, exclusively available in the metaverse
- Collate fresh consumer data
- Advertise products and services
- Support metaverse payments and finance
- Develop and promote hardware and software applications that can support metaverse activities
With the advent of virtual reality (VR) and the rising popularity of the metaverse, businesses and developers have been scrambling to get ahead of their competitors to strive in this new digital realm.
While skeptical businesses are still pondering if the metaverse will even matter to their companies, several metaverse concepts are already becoming concrete. Many big companies are investing, aiming to deepen customer loyalty, engage in new ways with their communities and grow revenue.
The good news is, it’s possible to separate the reality from the hype: understand what the metaverse is really about and take practical, affordable steps to meet your business needs.
Metaverse to enhance business networks (NVidia and Microsoft)
The immersive nature of the metaverse does not only pose new opportunities from a business-to-consumer (B2C) perspective but also offers new avenues of intra-business development. From training future surgeons to rolling out product demos to retail employees, there are plenty of business applications. For example, the leadership of tech company NVidia believes that investing in metaverse simulations such as manufacturing and logistics will reduce waste and accelerate better business solutions.
Microsoft is positioning its cloud services to be the fabric of the metaverse, using its Mesh platform to integrate avatars and immersive spaces into collaboration platforms, such as Teams, over time. With society embracing post-Covid hybrid or remote working lifestyles, many of these innovative virtual business experiences are likely to become more relevant tools in helping companies connect to their people and their prospects/customers.
Expand Product development (Nike and Sotheby)
Nike a highly established brand, it is certainly leading the charge at the assertive end of the metaverse spectrum, filing for patents for virtual goods and the opportunity to build virtual retail environments to sell those goods, as reported by CNBC. More recently, they acquired a company called RTFKT that creates virtual sneakers and collectibles for the metaverse. Sotheby’s recently announced its metaverse gallery for curated virtual art, housed in Decentraland. In time to come, physical goods may also be purchased in virtual worlds as capabilities continue to evolve.
With the metaverse, you can now put on a virtual reality (VR) headset and visit a factory on the other side of the world. You can not only see and touch its machines, but also shake hands with the local supervisor, and inspect its operations without leaving your desk. You could even send one digital version of yourself to that factory, while another meets with your board of directors. Anheuser-Busch InBev, the world's largest brewer, is using metaverse applications to dramatically improve its operations. They have used Azure Digital Twins to create a complete digital model of their breweries and supply chain that syncs up in real-time with the physical environment. The model enables brewmasters to adjust the brewing process and conduct quality control. Click here to see a useful video that illustrates how the digital twin process works.
Level up the immersive gaming experience (Fortnite, Roblox, Unity)
Major console and PC gaming titles, such as Fortnite, from Epic Games, have normalized playing and socializing with people in virtual settings. Newer gaming platforms, such as Roblox, allow people to create and play across immersive worlds created, and often monetized, by users.
Decentraland is an entire 3D virtual world owned by its users, allowing them to create virtual structures — from theme parks to galleries — and then charge users to visit them, all powered by Ethereum blockchain technology.
Other companies, such as MetaVRse and Unity, are creating engines to power brand and gaming studios and accelerate the development of AR and VR content creation.
NFTs - A force to be reckoned with
NFTs present a huge potential for businesses, with applications ranging from authenticating tangible goods to bringing greater ease to e-commerce and generating new revenue via virtual sales.
The prevalence of NFTs has been capturing a growing number of executives’ attention, with mentions of “NFT” or “non-fungible token” on earnings calls sky-rocketing over the past months. For businesses, they represent a huge opportunity to leverage the growth of virtual worlds and connect with their customers.
What are NFTs?
What are NFTs? NFTs are defined as “unique, digital items with blockchain-managed ownership,” per NFT marketplace OpenSea. These digital “items” can be digital assets or virtual goods — which can range from images to songs to videos to tweets — that are verified through blockchain technology. To find out more about NFTs, click the link here.
Businesses are leveraging on NFTs in the following ways
Use of NFT for tracking authenticity (Audemars Piguet and Breitling)
- Luxury goods and NFTs have overlapping traits, including scarcity, and prices are largely driven by intangible value. Luxury brands such as Gucci and Louis Vuitton have been engaging in research and development to sell virtual goods for a while and are rumored to be close to releasing NFTs. For these brands, their key consumers’ familiarity with virtual goods as well as their ability to come out with a peculiar online shopping experience is likely to determine their success rate. Authentication of tangible goods is another application of NFTs that is particularly relevant for luxury goods. Paris-based Arianee is already offering its NFT-based tracking and authentication solution to several luxury brands such as Audemars Piguet and Breitling.
Advertising in the virtual world (Pringles, Taco Bell, General Mills)
- While not every business can draw profit out of selling virtual versions of their products — food and beverage, for example — they can leverage NFTs to engage customers, especially those spending time in virtual worlds or metaverses. CPG brands are already leveraging the craze around NFTs to boost their products and increase brand awareness among new demographics by auctioning digital artworks. For example, Pringles and Taco Bell have already issued and sold some NFTs as a way to promote their brand and products to younger audiences. More recently, General Mills auctioned 10 digital artworks as NFTs to promote the return of its chocolate-flavored Dunkaroos, a popular snack brand that was discontinued in 2012 in the US. In addition to owning these NFTs, the highest bidders will receive some chocolate-flavored Dunkaroos before they hit store shelves.
Tokenizing products (Boson Protocol and Splyt Core)
- NFTs are not necessarily limited to intangible goods. As infrastructure is developed, merchants could tokenize physical products and services to help reduce online transaction costs and arbitration risks by bypassing intermediaries such as Amazon or Shopee. For example, a fashion brand could tokenize the ownership of a physical dress and put this token on sale — the owner of the dress — to any consumer or reseller. The payment would be escrowed to protect both parties and reduce counterparty risk. The buyer could then redeem the token and get the dress delivered or resell it. Startups such as Boson Protocol and Splyt Core are already working on building NFT-based decentralized commerce infrastructure, touting additional benefits such as enabling physical good authentication as mentioned.
Selling digital art
- Digital art is leading adoption: While NFTs can represent many things ranging from trading cards to plots of virtual land such as the ones you can buy on Decentraland, most of the recent headlines have been about digital art being sold for eye-popping prices. This includes a $560K New York Times column, Beeple’s $69M JPEG, a $7M Cryptopunk icon, and Jack Dorsey’s $2.9M tweet, among others.
Is it too late for my business to enter the metaverse?
Facebook was only made available to people outside of US universities and corporations in late 2006. By 2008, it had 100 million users. These things can certainly grow at incalculable rates.
Don’t worry – whether you purchase a digital art piece or virtual land today won’t determine whether your business will survive tomorrow. It may be useful to think about how crucial social media pages such as Facebook, Twitter, and Instagram are to businesses, and then picture how utterly alien they would be to businesses getting introduced to them in 2005. The same logic can be applied to businesses in the 1980s and web pages.
The metaverse is still in its early stages of development and no business today can confidently claim that it has conquered it. However, its influence and applications - those currently running as well as those in development - are growing relentlessly. Every business intending to stay in its game should be ready for this new realm of fresh possibilities that will require all sectors, industries, and companies to be flexible, adapt quickly and, above all, start taking the value of digital spaces seriously.
Conclusion - Once a novelty could soon be a necessity
Although digital reality still feels like a distant dream lurking deep inside the pages of a sci-fi book, the shift to a virtual, online world could hit us sooner than we think.
Businesses should always be in an experimental model and approach the digital landscape with unwavering intellectual curiosity. In addition, we should perceive the metaverse as an evolution rather than a revolution – the next iteration of how humans use the internet to collaborate, connect and transact – sitting on the sidelines too long may cause you to miss the boat.
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