To some, it may seem that metaverse is a new buzzword. Organisations from all sectors have rushed to announce new virtual offerings, from Prada’s virtual winter sports line to Disney’s announcing that the metaverse is ‘top of mind’.
While the metaverse can be a valuable tool for engaging customers and opening up new revenue streams, businesses need to be wary when it comes to launching into the metaverse. An approach which isn’t led by a clear strategy for improving customer experience could leave businesses open to criticism that they only want to turn a profit, rather than create an offering that has been genuinely designed with customers in mind, or to improve business functionality. This kind of backlash could prove disastrous for organisations, so careful strategy is essential. Here are the top three things businesses should avoid when entering the metaverse.
1. Prevent not putting the customer first
The metaverse cannot just be about businesses earning some quick extra revenue when it comes to their offering within virtual worlds. Organisations must instead focus on offering customers new and improved experiences that enhance the overall customer experience. Otherwise, businesses risk criticism that they do not care about their customers, which could ultimately lead to brand damage and a lack of trust from their target market. This is something we’ve seen in the gaming industry, for instance, where gamers reacted badly to Team17’s decision to offer NFTs, feeling that the company was doing so to make some extra revenue. To do this, organisations can offer customers exclusive rewards or experiences in the metaverse that they would not have access to in the physical world, such as access to limited-edition merchandise or the ability to attend exclusive virtual events.
These rewards can be unlocked or facilitated by NFTs (non-fungible tokens which cannot be replicated or forged) within the digital universe. These NFTs can be offered to consumers as a reward for virtually interacting with the brand or organisation, or can be offered as exclusive collectables. This is something we’re seeing within the luxury goods space already. For instance, Gucci auctioned its own NFT artwork inspired by its Aria collection, letting customers feel closer to the brand, as well as creating long-term value.
2. Keep clear of charging ahead with no strategy
Businesses may feel tempted to jump on the bandwagon when it comes to the metaverse, but without a clear strategy or considering a long-term plan, the ROI could be compromised, particularly in terms of building a lasting solution that truly engages the customer base. Without a plan, organisations might fall into the trap of wasting huge amounts of time and resources on a metaverse strategy or initiative which can actually only succeed in the short-term, doesn’t fully engage their customers, and focuses on quick revenue injections over long term strategies, or opens them up to criticism that they are merely adopting a trend, rather than undertaking a serious business decision.
It’s essential, then, for businesses to create a dedicated metaverse strategy if they want to take full advantage of the metaverse. This strategy should include a plan for how they can utilise innovations in web3 and metaverse technology to improve the customer experience and create additional value on an ongoing basis.
One strategic approach that businesses can take is pairing metaverse platforms with exclusive NFT offerings. NFTs are key to the metaverse, as they will act as the currency of the virtual world. As well as adding long-term value for customers by giving them access to exclusive collectables, having a combined metaverse and NFT strategy means that companies can use NFTs within the virtual world to their full potential, rather than jumping on the bandwagon and missing out on future benefits. For example, fashion brands could create additional revenue streams and opportunities from NFT ‘wearables’, a type of NFT that can be purchased by customers and then worn by their avatars in the metaverse. Many luxury brands are already taking advantage of this type of NFT – Balenciaga previously launched a collection of outfits in Fortnite for players to purchase and have their avatars wear in-game. This can allow businesses to create more value in the digital universe with NFTs, giving fans access to unique options that they can then use within the universe. Not only this, but companies can also create even further value for customers with wearable NFTs by attaching personalised rewards. This could look like having the buyer’s name included on the piece – for instance, a sports jersey with the player’s own name on the back. Not only does this take NFTs to the next level for collectors, creating new revenue streams for brands, but it also has the potential to engage new audiences across the metaverse.
3. Avoid relying on one platform
Virtual environments and NFT platforms have the potential to engage customers in new and exciting ways. This is something we’re particularly seeing in the sports business. For instance, the leaders at Manchester City are building a virtual version of the Etihad stadium. However, relying on just one platform or environment can be risky for businesses – if you put all your eggs in one basket, this could be a problem down the line, causing issues if the platform is compromised in some way, not to mention that you may struggle to reach the desired customer base by utilising only one platform. Instead, businesses can integrate with or utilise existing platforms to expand their reach into new audiences and markets, alongside potentially using their own virtual worlds.
There are already a number of existing virtual worlds and different platforms with established audiences that can be utilised by brands looking to enter into the metaverse – some of the best-known examples being Decentraland, Roblox and Sandbox. Intelligent and leading brands will be evaluating what is available and deciding on the right platforms to use, making decisions based on a dedicated strategy.
Businesses seeking to harness the metaverse have a real opportunity to take the lead with this new technology but, without forward-planning, they’re at risk of losing out on its full potential. By avoiding the concerns outlined above, businesses can ensure that their metaverse plans are future-proofed and have the biggest appeal possible for customers and fans alike, improving the experience for both new and existing customers.
About the author: Lars Rensing is CEO of enterprise blockchain and Web3 solutions provider Protokol.