Embracing the Metaverse as a Practical Marketing Channel

TL;DR — This is a longer read than usual :).

Since its inception, the internet has gone from being a ‘fad’ to a ‘necessity.’ There was, however, a time when the internet had been termed a fad. The word ‘fad’ has since been used for emerging technologies such as social media, virtual reality, and artificial intelligence. While the world saw Cryptocurrencies rise during the pandemic, the metaverse saw a silent yet meteoric rise to prominence.

The pandemic’s far-reaching impact saw nations and businesses across the world reimagine their strategy. Most companies went through a ground-up rebuild that saw several technological innovations. Business processes were among the most affected with organizations opting to use technology as a medium. Although the metaverse was largely viewed as a ‘pandemic product’, it has stood the test of time to become a practical tool in an organization’s marketing arsenal.

The article published by McKinsey does indeed make for a very compelling reading. Here are six reasons why the metaverse ‘fad’ is here to stay.

1. Advancement of the technology itself — The advent of Virtual Reality and ‘The Oculus’ was possibly the first time anyone had given thought to the notion of the metaverse. However, it was the pandemic and subsequent lockdowns that accelerated the maturing of the metaverse technology itself. For instance, gaming companies such as Call of Duty and DOTA had already begun designing games in the metaverse. It was only a matter of time before the technology itself was formalized. Lego, a Danish company manufacturing educational products for children has also invested a sizeable part of its Research and Development into the formulation of the metaverse.
   An interesting point to note has been the popularity of online ‘collectibles.’ These intangible pieces of collectibles are generally termed NFTs (Non-fungible tokens). These tokens have effectively disrupted the collection and art industries. Gaming companies such as Indus have begun offering NFT tokens to attract more gamers to their platform. In less than 18 months, the ‘fad’ of the metaverse has become a sustainable business model for several organizations across the globe.
2. Investments in technology — Reports of Meta (formerly Facebook Inc.), Microsoft, and a plethora of private equity firms have invested vast resources into developing the metaverse. Upon googling the TAM (Total Addressable Market) of the metaverse, one can see the magic number of 13 trillion USD appear. Even a small share of this market can make or break any company in the world.
   Forbes magazine, a leading worldwide business publication conducted its Under 30 conferences on the Metaverse. The results and engagement metrics were off the charts, to say the least.
3. Industry agnostic applications — While the gaming industry appears to have benefitted from the metaverse, the use cases and applications are quite long. For instance, the E-sports universe has effectively been moved to the metaverse with gamers from across the world attracting millions of viewers to a metaverse platform. Game streaming services such as Twitch have successfully integrated
4. Disrupt online commerce — Among the use cases that thrive in the metaverse is online commerce. While e-commerce has disrupted the industry over the last few decades, online commerce on the metaverse gives upcoming brands equal opportunity to display themselves. A good example of this can be found in the Turkish night market where online commerce and the metaverse find an unlikely blend.
5. Diversity in user base — While the world stays divided on Gen-Z’s entering the workforce, most organizations are taking note of their spending habits. In a bid to capture a piece of the market, brands are turning to the metaverse. The Nike polygon shoes and other NFT collectibles have seen the legendary shoe brand enter the metaverse and open a blue ocean by making non-customer Gen-Z’s become part of the Nike family.
6. Brand awareness — Dovetailing from the earlier point, brands can create awareness around their products and or services. The source article from McKinsey refers to how influencer marketing has moved to the metaverse. Several individuals have also made inroads by making NFTs on themselves to promote their brand. ‘Digital Prateek’ — a Digital Marketing influencer in Mumbai has launched his NFT with varying degrees of success for his business and brand.

Marketing on the Metaverse

As mentioned in an earlier reflection paper, marketers ruin everything. Any ‘fad’ that attracts eyeballs is soon populated and disrupted by marketers vying for a few seconds of eyeballs from users. The metaverse, in all fairness, is no different. However, given the nascency of the technology, marketers might find themselves in unchartered territory. Therefore, here are a few ways marketers across the globe can look at tapping into the metaverse to serve their marketing needs.

1. Engagement and Experiences — Marketing is about creating experiences that target audiences cherish and remember fondly. Therefore, marketers must realize that irrespective of the platform, the principles of marketing remain the same. It would also behoove marketers to recognize that the newer generation (Gen-Z) prioritizes experiences while making purchase decisions. The metaverse can be used as a nudge for the same.
2. Recognize if the Metaverse is the platform or not — The number of industries that can be marketed using the Metaverse still is to be seen. As things stand, it appears that B2B industries such as aviation, real estate, and pharmaceuticals might find little joy in marketing products on the metaverse. A good marketer recognizes whether the metaverse can aid in marketing their products.
3. Hold back from direct sales — Cut-throat competition has forced marketers to rethink their approach. The fact remains that most customers would like to associate with brands that stand for something. Seth Godin’s (the guru of modern marketing) blog refers to marketers ‘dating’ customers following which they can convert them into customers. This increases the LTV (lifetime value) of the customer despite an increase in the sales cycle.
4. Success metrics and measurements — Finally, a marketer must always look to measure campaigns. Success metrics generally begin with traffic to the website signups to final purchases. Of course, it isn’t always as straightforward, but measurement of campaign success allows marketers to remain in the metaverse.

Conclusions and General Reflections

1. Experiencing networking events on the metaverse has convinced me that it is indeed here to stay. And marketers will make their entry into the metaverse sooner rather than later.
2. Gaming has already exploded with millions flocking to the metaverse to catch the latest e-sports battles. The metaverse has been instrumental in e-sports becoming an Olympic sport and recognized by the IOA (International Olympic Committee)
3. As technology advances with NFTs and Virtual Reality, marketers will find ways to enter the metaverse and promote products conducive to the kind of audience found on metaverse platforms.