There is often a tangible buzz when a new word gets added to the English language. The latest terms are frequently coined as buzzwords or brands and adopted by the public. We either live with them, or they go into the deep, dark corners of the human brain – never to be extracted or resurrected.
Metaverse was another. With companies like Facebook incorporating it into their names and marketers responding like the last sale at Cosco did, the reaction has been fascinating, varied, and maybe metaphysical.
New English terms are being created at a rate of about 1,000 per year. Adding words like blog, grok, crowdfunding, hackathon, airball, e-marketing, sudoku, and twerk have significantly changed the dictionary in recent years. Metaverse is another one!
As a fintech insider, evaluating and understanding the term metaverse is essential. There is no formal definition of the metaverse, so we can understand it as a convergence, enabled by virtual reality and augmented reality, of our physical and digital life.
A recent report by Mckinsey forecasts that the metaverse is an evolution that will play a significant role in our lives over the next few years. The numbers are there, too: Google’s search engine reveals 677,000 results for the term “metaverse,” and the hashtag #metaverse is widely employed on Instagram, with more than 60,000 posts. Twitter also receives more than 500 tweets per hour using this hashtag.
The metaverse was first introduced to us through popular films, such as Inception, Terminator, Avatar, and The Matrix. Often these movies paint a dystopian picture of the future where things have gone awry. From what I understand, the metaverse is a space where consumers can have virtual brand experiences that are realistic and rooted in our present lives but also a bit removed. Metaverses are virtual universes that merge reality with the virtual world and are becoming a current reality.
Brands may use the metaverse to provide a better customer experience. There would be a world where product webinars and demonstrations are more immersive, and a consumer can almost live the brand and feel it – a heady mix of left- and right-brain experiential scenarios. This virtual world provides us with many lifestyle opportunities, such as concerts, parties, travel, food tasting, and fashion, to name a few. Try before use – and not in a supermarket’s changing room! The boundaries are unlimited – the experiences many.
Metaverse: stepping into virtual reality; a parallel world
The metaverse and NFTs, cryptocurrencies, and other technologies have been the most popular in recent years. In various disciplines, it is heralded as the next big thing.
In a virtual world, what can we do?
The options are truly limitless. Some aspects of the metaverse’s potential have already been recognised. Quoting some examples; Roblox, an online video game company, has its own metaverse and is a pioneer in user-created virtual worlds and hosting significant events on its platform.
Some consumer businesses have already begun their journey to provide their customers with a user-friendly environment with varying degrees of density. Disney+ Hotstar is yet another effort at entertainment promotion in the metaverse. To promote its upcoming show Rudra, the OTT platform collaborated with Hefty Entertainment to build a digital avatar of Ajay Devgn. Another exciting example; is a recently staged wedding on the Indian metaverse site Yug. Companies built up virtual boutiques inside the wedding site, a beautiful beach, where guests mingled and could look around and even shop.
Virtual and augmented reality have enormous promises. According to Bloomberg Intelligence, the global market for the metaverse is estimated to reach US$800 billion by 2024. There is a lot of growth in this industry, and immersive digital experiences are increasingly becoming a popular trend.
Metaverse’s implication for the future of marketing
So, how can marketers make use of the metaverse’s current opportunities? How can businesses use it to benefit their brand, image, and customer experience while also making a turnover?
Promotion and advertisement:
The change from digital advertising to metaverse marketing allows businesses to reach a vast audience at a lesser cost than traditional techniques. Brands have already begun to invest in virtual ads in video games.
The metaverse can be considered a more prominent social media in and of itself, where people can become digital versions of their real-life identities and engage with other people’s digital lives. For instance, TopSocial has announced the debut of ‘Kyra,’ India’s first Meta-Influencer.
A more innovative approach is how companies develop advergames, an advertising tactic in which games are utilised to promote products or services. As a result, the businesses do not promote in other people’s games but instead create their own.
The most intriguing marketing and customer experience possible in the metaverse is what could be called metaverse retail. Brands are selling digital items inside the metaverse, known as the direct-to-avatar (D2A) market.
It’s a step forward in metaverse marketing when brands correctly claim virtual real estate in the metaverse with their own virtual venues. Hyundai Motors, for example, has built five theme parks on Roblox to introduce younger people to the company’s products and future conveyance options.
Although this is primarily a strategy used by the entertainment industry, the attendance figures are astounding and demand our attention: Travis Scott’s concert on Fortnite was watched by 2.3 million people, making it a huge success, and now corporates are increasingly realising the value of virtual events for their customer experience and have begun to explore on this grounds.
Metaverse’s implication for the future of financial technology
The metaverse has the potential to revolutionise how we interact with financial technology. The world of banking, trading and payments could all be entirely transformed by it.
The banks of the future could exist entirely within the metaverse. Customers could visit their bank’s virtual branch to conduct all their banking business. This would be a more convenient and immersive experience than visiting a physical bank branch.
The metaverse could also change how we trade stocks and shares. In the future, stock exchanges could exist entirely within the metaverse. Traders could buy and sell shares in virtual companies using virtual currency. This would make trading more accessible and convenient than it is currently.
The metaverse is already changing how we make payments. Virtual currencies are already being used to make payments in the real world. In the future, we could use virtual currencies to make payments in the metaverse. This would make payments more secure and convenient than traditional methods such as cash or credit cards. Regardless of the payment type, however, it is inevitable that fintech will play a foundational role in the metaverse’s development.
There are also dozens of other fintech verticals that the metaverse will have an impact on. These include insurance, lending, accounting and many more. The possibilities are endless, and the potential for disruption is enormous.
The metaverse is still in its early stages of development. However, it is clear that the metaverse will have a profound impact on the financial world as we know it and has the potential to change how we live, work and play. It is therefore crucial for businesses to stay ahead of the curve and be prepared for the opportunities it will bring.
What steps could businesses take to prepare for the virtual world?
Fintechs could start exploring how they can use the metaverse to improve their products and services. Banks should consider using the metaverse to provide a better customer experience. Traders could explore how they can use the metaverse to make trading more convenient and accessible. Payment providers could explore how they can use the metaverse to improve the payments experience while enhancing the security of the metaverse.
There is a lot of hype about the metaverse. If you’re sceptical of this new digital cosmos, concerned that it will be nothing more than a passing whim, you’re not alone. On the other hand, technology has impacted how we market to clients for decades. To suggest that you could pay for products with your phone in stores fifteen years ago would have been absurd. However, it is now simple. Nobody predicted that you’d be able to make purchases over the phone and have them delivered the next day. This reality is starting to make sense.
The role of leaders, and the brand for which they carry the flag, is that of responsibility. As long as it is regulated and the experiences are limited to creating wow ones, no one is hurt, and the metaverse is something we could all productively harness. But a line needs to be drawn somewhere.
About the Author: Debal Dutt is the Executive Vice President & Chief Marketing Officer at Intellect Design.