Last year, when Facebook (Meta) unveiled Metaverse, very little was known about the existence of this virtual world. Several critics compared it to movies like Ready Player One, while others were unhappy with the direction of the platform.
After ignoring the initial buzz for several months, I decided to explore whether or not the Metaverse genuinely exists, or whether it is only a distant future that everyone is excited about. But the challenge is where to begin.
Horizon World, also known as Meta’s virtual world or Metaverse, only gives you a preview of what the platform will eventually become. Meta has been using the platform to host live events, music concerts, and community-led events.
But that hasn’t stopped brands like Nike, Wendy’s, and others from experimenting with Metaverse. As Vishal Shah, Meta’s VP of Metaverse, puts it, “The full vision of metaverse may be years away, but brands should start experimenting on what their metaverse presence will be now. There are experiences like Horizon Worlds which can give people a feeling of what it means to be together in an experience — it’s a great place to start.”
Meta’s entry into the metaverse has catalyzed the whole industry. Metaverse-related companies have raised upwards of $10 billion, more than twice as much as last year. But before delving into what Metaverse is, who are the key players, and how brands should leverage this platform to create new experiences for their potential customers, let’s start with the basics.
What is Metaverse?
Metaverse is a virtual world that mimics the real world using technologies like augmented reality, virtual reality, artificial intelligence, social media, and virtual currency. While we browse the internet, the metaverse is something that people will be able to experience and live in.
The concept of the metaverse was first described in the novel Snow Crash. Ready Player One by Ernest Cline was another novel that popularized the idea further. Several companies have built on the concept in the last few decades, including Second Life, Klay City, and Roblox.
Why is Metaverse here to stay, and who are the big players?
The technological advancements of the past few decades have created the ideal conditions for the metaverse to become mainstream. Data consumption has increased exponentially due to the adoption of 4G; Indians, for instance, consume 12 gigabytes of data every month. We have the highest data consumption in the world. Advances in cloud and edge computing coupled with 5G will improve this further.
In 2021, Meta invested $10 billion in the metaverse. Investments in the space as a whole went up, and almost every big tech company wanted a piece of the action. The Metaverse’s total addressable market (TAM) could potentially be $8 to $13 trillion per annum by 2030.
Metaverse might also boost omnichannel commerce; if most of us spend our time in virtual worlds, we will likely utilize virtual currency to purchase virtual goods. The virtual-goods economy today accounts for almost forty percent of the worldwide gaming income generated by the billion players in the globe.
Consumers of Generation Z will also be active participants in the metaverse. This generation of consumers is more acquainted with virtual worlds, transactions, and products than prior generations. The fact that 67 percent of Roblox’s 50 million daily users are under the age of 16 may indicate the emergence of an entirely new generation of native metaverse users.
Marketing in the Metaverse from an Indian Context
Marketing in the metaverse will be unlike anything you have previously encountered. The focus will most likely shift from advertising to experiences considering the immersive nature of the platform. Nikeland, the micro metaverse built on Roblox, points out this fact.
Since its debut in November last year, Nikeland has garnered 6.7 million users from 224 countries. In addition to playing to Roblox’s strengths as a platform with activities such as dodgeball, the space enables users to try on virtual products.
Nike is banking on its strategy to sell virtual NFTs to monetize its micro metaverse. The brand acquired RTFKT, NFT collectibles, and fashion startup to build Nike Virtual Studios. Unlike other brands, Nike has a clear vision of what they plan to accomplish with their micro metaverse. Nearly 26% of the brand’s revenue comes from digital initiatives, and with this investment, they are doubling down on growth.
In India, most use cases of marketing in the metaverse have focused on virtual launches. For instance, Gujarat Titans ‘unveiled their new team logo’; more recently, Hyundai launched its Venue N Line range on the metaverse. The natural next step for some of these companies would be to sell non-fungible tokens or virtual goods.
But unlike Nike and Wendy’s, most brands don’t have a well-thought-out strategy; the adoption is mainly driven because they don’t want to miss out (FOMO) or because it makes for a good PR story. So if you are jumping into the metaverse bandwagon, where and how do you even get started?
How to start marketing in the metaverse in India?
1. Selecting a platform to build your micro metaverse
The most popular virtual worlds or metaverses that exist today are Roblox, Fortnite, Minecraft, Horizon World, Decentra Land, and the Sandbox. Fortnite might be the largest in terms of numbers considering it has over 390 million users; however, that might be an inaccurate comparison to make. Considering some of these platforms predominately started as gaming platforms but have morphed, over time, into potential virtual worlds.
But since Fortnite demands that users have a high-end system to handle all that graphics, the platform hasn’t taken off in India. Unlike other markets, India isn’t a console or PC gaming-friendly market; rather, it is driven by smartphone gaming. But still, Fortnite is played by at least 8.5 lakh Indians, but nothing close to PUBG (Battle Grounds India), played by over 22 lakh people. Yugverse and OneRare, which is trying to position itself as a food metaverse, are also promising Indian alternatives.
2. Limited-time activations vs. always-on experiences
In India, limited-time, event-based metaverse activations are preferred by the majority of brands. The trend closely mirrors what’s happening on Roblox globally; very few brands choose to create an always-on custom-built brand space. Limited-time activations allow brands to understand how the platform works, scale, and build more robust experiences if the audience is receptive.
Limited-time activations always receive higher engagement because there is a clear impetus to experience them before they go away. They can also fit better into the natural marketing cycles of brands since most marketing campaigns are limited in time and not always on.
Even brands are opting for limited-time activations. In October last year, Chipotle held a free burrito event that got a lot of attention. Some users thought it caused the platform’s servers to crash.
Some brands are a natural fit for a persistent brand space or micro metaverse, especially if you have a portfolio of brands or IPs that you want to promote. In fact, Godrej had created Go Jiyo, its own metaverse or virtual world, back in 2010, it didn’t take off because they were early in the game, and technology hadn’t taken off yet.
3. Costs and other implications
No matter which metaverse platform you choose to work with, you will have to build your brand space with the help of creators and developers. Roblox developers, for instance, charge between $60-100+/hour.
If you need a persistent custom brand space on Roblox, you should be prepared to spend at least $150,000, which doesn’t include the cost of promoting it. This cost can also go as low as $25,000, depending on the scope of your project and the complexity involved. Also, creating persistent brand space would mean you will have to work with creators/developers on an ongoing basis and dedicate internal resources to consistently refreshing the space with updated content.
If you get past the hurdle of finding developers and funding the whole project, then you have to manage challenges like brand safety and how the project will feed into what you are trying to achieve as a brand.
Metaverse beyond the hype
Metaverse, or at least the vision Mark Zukerberg seems to be selling, feels a lot like a distant reality. The hardware and software both have to evolve at a rapid pace. If you somehow solve that challenge, you have internet connectivity that needs fixing. Even though projects like Starlink and Kuiper sound great, would they take off in India, where the government makes thousands of crores from spectrum auctions?
Putting aside the technology, is this a future that excites people? Elon Musk made a valid argument about metaverse sometime back, “You know when I grew up, it was like ‘don’t sit too close to the TV it’s gonna ruin your eyesight’ and now TV is like literally right here (puts his hand very close to his face), I’m like umm what? Is that good for you?”
Before we dismiss the idea of marketing in the metaverse and what it will end up looking like as marketers, we must stay informed about where it is headed.