The previous article already showed us how the metaverse is to look like from the technological point of view. Probably in a few years each of us will own VR glasses to transfer us to virtual reality. What will change in our lives and will this change happen?
In a survey by Wunderman Thompson Data, 72% of participants described the metaverse as a great thing, and 74% of them said that it would be our future. Does it mean that we will not leave our homes for work or shopping, and will see our friends only online? Let’s see.
An introduction to the virtual world
Before we start to analyze our future life, we should get acquainted with a few terms described below. This would definitely help us to move around the metaverse, which is associated with plenty of new words:
- Interoperability means an ability to involve in virtual experiences, travel between sites and identities, without changing platforms.
- Persistence means a continuity of existence; a continuation of a virtual life, regardless of whether you are offline or online.
- Decentralization means shared ownership. An idea, according to which the metaverse will not be governed by corporations or individuals.
- NFT (Non-fungible tokens) means tokens that cannot be replicated. They are digital certificates of authenticity with which we can prove a basis of digital ownership.
- Digital twins are physical spaces cloned in the virtual world to promote brand awareness.
- Liminal spaces are a new generation of places, meetings and event locations that contain both physical and virtual components.
- Extended reality is a term under which we find combined augmented, virtual, and mixed realities. Information on different types of realities is presented below.
- Web3 or Web 3.0 is a decentralized, blockchain-based Internet network in which the virtual and real life will merge.
- DAO (decentralized autonomous organizations) are decentralized autonomous organizations maintained by a digital society on the basis of the blockchain technology.
- Virtual teleportation is a technologically new form of a journey or cooperation that uses multisensor and photorealistic renderings. This way, we can feel as if we were in the same room as a person who partly shares it physically.
As you can see, the dictionary will have to be expanded with many new words that probably do not function in Polish yet. So, what is waiting for us in the metaverse?
Social aspect of the metaverse
Apart from all technological and physical aspects, the area worth focusing on is the society. The metaverse is discussed as a virtual space in which our life will happen in parallel, will be our twin life or its virtual extension. Some also say that it will be just another digital dimension of our life, in which we will function. MetaLives will enable us to order clothes, cars, or buy virtual land of our own. We write about this as if it was the future, but in fact it is already happening.
Already, we can create our avatars using an iPhone or an iPad, or in Messenger. We can choose the colour of our skin or eyes, select a hairstyle, and clothes. We like to present that virtual person, change its clothes or headgear. It is similar in the virtual world. At the moment, it is limited to avid gamers, but probably everything that is happening in a virtual reality of games, will be transferred into more extensive fields and gain even higher value in the society.
Digital goods market
The examples are not hard to find, and brands gradually realise the consequences of launching digital products. Below, we present a few of them.
In 2019, The Fabricant, a digital fashion house, cooperated with brands such as Adidas, Puma or Tommy Hilfiger, but it also sold its own design for a dress for USD 9,500. It may seem that paying USD 9,500 for a dress that does not exist is quite an expenditure, but customers assign a relatively high value to that product. Why? We wrote about it at the end of this article. In 2021, The Fabricant was worth over USD 76,000, and its estimated value is still rising.
In February 2021, an NFT sales platform called RTFKT sold 600 pairs of virtual shoes in just 7 minutes. This brought it a profit of 3.1 million. What is NFT? This abbreviation means a non-fungible token. It means that we cannot replace a given token with another, identical one. We should add to this their digital nature. It means that NFT are irreplaceable digital tokens. An example here is sales of a model of shoes by Nike: RTFKT x Nike Dunk Genesis CRYPTOKICKS.
On the website, we see several dozen nearly identical models of shoes. What differs them is an ID of a given token. With it, we buy a unique model. Under a relevant photo, we see the value expressed as Ethereum. Converted to Polish zloty, the price at which the models are available ranges between PLN 5240 and PLN 655,000, although an average price is about 12 thousand zloty per model. Does it sound intriguing?
In June 2021, the fashion brand Gucci sold its purse for 4 thousand dollars in Roblox, a social game. Its users create the reality themselves and share it with friends from all over the world. The purse reached a higher price than it had in the real world. Can we expect the brands to open their virtual stores? Absolutely! Gucci opened Gucci Town space in Roblox, and there players can play mini-games, learn a little bit more about the fashion house heritage, or buy clothes for their avatar.
In all cases, NFT prices reach enormous levels. When we add to it the fact that those products are digital, i.e., will never have physical characteristics and will only exist in a virtual reality, then their price seems to be even more extravagant. However, what makes us buy digital products so willingly, even those which prices reach unbelievable levels?
- They are available to a selected group of customers. Each NFT group is limited – for example, only 100 tokens are let in, and only 100 people can boast of having them.
- The right of exclusivity also works in favor of desiring NFT. Due to its exclusive nature, a given product is associated only with one company or event. It is like with the RTFKT x Nike Dunk Genesis CRYPTOKICKS collection mentioned above. There are thousand models of Nike shoes, but only a limited group of people will have one unique model for themselves.
- The higher the price, the higher the quality. Of course, it is hard to talk about the quality of digital tokens, but consumers associate higher prices with higher quality, and thus the product is more desirable.
- Clothes or accessories are simply means to express ourselves, and the same applies to the digital world. Additionally, they have a financial value. We can easily purchase and sell them for money.
In the future, we will buy clothes, accessories, cars, or even houses using Ethereum (ETH). A consumerism of the future is associated with virtual products, and a centre of the wardrobe gravity is being shifted to virtual reality. Probably our physical wardrobe will be limited, while the virtual one becomes unlimited.
The real estate market flourishes
It seems that the years 2020–2021 brought profits not only in the digital luxurious goods market, but also in the digital real estate market. 500 thousand dollars is a price for a virtual Mars House, sold in March 2020. A year later, in 2021, a virtual plot in Decentraland was sold for 913 thousand dollars. Another interesting social browser game is The Sandbox, which broke a record in the virtual real estate market. Over 2300 plots were sold for 2.8 million dollars, and the users increased their value to 37 million dollars.
The digital real estate market flourishes and abhors a vacuum, therefore, Metaverse REIT, a real estate investment fund, was established. Its task is to help in implementation and exposure of developers who want to start investing but do not know how.
The users are increasingly interested in the virtual real estate market.
Owning and developing your own piece of a meta universe will probably bring many benefits, mainly financial, in the future. It is also a potential opening of a completely new market.
We may not be able to imagine it now, but in a few years our life will be conducted in the metaverse. We will have virtual houses, clothes, and vehicles, and go for a holiday or work there. We will live a metalife.
In 2020, the Food and Drug Administration (FDA) in the United States approved the game EndeavorRx as a therapy supporting treatment of cognitive disorders. Initially, the game was introduced to treat ADHD disorders. Doctors recommended 25 minutes of the game for 5 days a week for a month. In consequence, an improvement in attention deficits was noted in one out of three children. In April 2021, one of the centers in New York started studies on prescribing the game to patients with brain fog caused by the coronavirus infection.
Increasingly larger number of people use the benefits of the technology to care for their physical and mental well-being. A study conducted in people from the United States, UK and China shows that mental and physical health of every second person improved due to the technology. This gives rise to a new class of drugs: techceuticals. Of course, this also encourages people to enter the metaverse world, so a certain group of users will have no problems with using the technology of a new kind.
Do we feel ready for the metaverse?
83% of the global Internet users think that technology brings people together. In China alone, 84% of people say that technologies improved their relations with their families and friends. Social media has become global platforms. We observe people from all over the world. Facebook, Instagram or Snapchat are called social platforms for a good reason. It is there that we look for answers to our questions, talk with different people, or exchange our views. We moved a significant part of our social life to the network. This was caused not only by the social media themselves, but also by circumstances that affected us. The media became more social due to the coronavirus pandemics. People organized concerts, lectures, or webinars. We connected and created a community, although it was not possible to meet in person.
Social media increasingly often prepare us so we can easily break through a barrier, not only mental, but also a technological one. IMVU is a social platform based on 3D avatars. It was established in 2004, and at that time it did not gain recognition, until today. Using IMVU, people work actively and create new, important relations, As Daren Tsui, the IMVU platform publisher says: ‘Social media do not fulfill our need to have friends – they are more media than social networks’
We could present multiple examples, but another thing that is worth noting is the omnipresent availability of video materials. Sites at which we use the video format include streaming and VOD platforms, video games, or Tik Tok and Instagram applications. The popularity of this format increases. In Poland, users spend 6 hours and 42 minutes a day on social media, on average. And ⅓ of them dedicate nearly two hours solely to Tik Tok. Instagram successively increases the presence of video materials, although it started as an application offering sharing of photographs. Being used to the video will make entering the metaverse world easier. We will get used to moving pictures that are quite abundant in the metaverse, as this whole world is built of 3D video.
Are we ready for the metaverse? Probably not yet, but neither is the technology. It is worthwhile to monitor the market and changes, because it may turn out that the years 2023–2024 will bring us “new” technologies and devices. Social media evolves and successively prepares us for entering the digital world, in which we will build our new lives.
Last but not least…
The metaverse is not a place solely for the Internet users. It is another place for customers and sellers. Over 88% of the Internet users expect the brands to appear in this space. Of course, if we find ourselves in the metaverse times, it will be necessary to adjust marketing and sales strategies. So you should keep your finger on the pulse and observe the social media market; particularly, as it will touch our entire life. 68% of the respondents say that the metaverse is the future of e-commerce and online shopping.
The metaverse represents an opportunity for many brands, mainly due to a possibility of a direct interaction with the users and the extensive consumer base. If you manage a brand, it is a good idea to have a look at execution of online stores in the metaverse, creating also a fully complete online experience, where customers can meet, experience, and play. In the future, this may translate into higher profits. Are you wondering what it looks like?
Skechers (a brand of shoes and clothes) was the first to sign a rental contract in the Decentraland fashion district, intending to open an experimental virtual store. Skechers also submitted trademark applications, to sell virtual goods, including shoes and clothes, in the entire Decentraland.
The brand not only did enter the metaworld wishing to sell virtual shoes and clothes, but also prepared for the opening of an official shop in the virtual reality. Michael Greenberg, Skechers president, calls the contract with Decentraland “an investment into our future” and says that the brand is looking forward to “embarking on this virtual era, and exploring creative ways for our brand to engage with new customers and audiences as we launch the new Skechers experience”.
The metaverse gives endless opportunities: reaching a new group of customers, establishing stronger bonds with clients, and guiding them through new brand experiences. The future of e-commerce is in the metaverse, and it depends solely on the brands at which moment they decide to expand the field of their operations.
The times are a-changin
The metaverse will influence every aspect of our life: finances, food, entertainment, work, or government. This vision may seem an utopia, yet some of the described situations have already occurred. These events pave the way not only for new users, but also for the brands. Observe them and try, because soon this vision may become a reality. What is your opinion on this subject? Share your thoughts with us in your comments!