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If the journey of a thousand miles begins with a single step, how does one take that step when on a virtual journey? In a recent conversation, I was asked, “how does someone move in the metaverse? Do they float? Do they glide? Do you walk or run, or is it more like surfing?”
The questions revealed both a genuine curiosity and a true lack of understanding that is shared by most people who don’t quite know what to make of this multi-universe, immersive experience that has sparked as much interest as it has investment from businesses and individuals betting the metaverse is the future.
Why are Nike and Adidas developing footwear for that virtual step? Why is Coca-Cola creating a “pixel-flavored” drink? Why are offices, classrooms, gyms, concert venues, sports arenas and every other entertainment and educational center moving into the metaverse? Most importantly, how does a company, of any size and from any industry, prepare to take the first steps of its virtual journey?
For businesses attempting to enter the metaverse, there are a series of measures that must be taken that mirror many of the same actions a company would take were they to enter a new market in the physical world. From defining and researching the market, to analyzing and assessing the opportunities and risks, to designing a market entry plan, to ultimately allocating and unleashing the necessary resources, both capital and organizational capabilities.
If a company were interested in opening a new brick-and-mortar location in the real world, the business would aggregate data about various locations, study the population of consumers in each location and investigate the possibility of further development by other companies in those same spots. The same process of destination evaluation and comparison exists in the metaverse.
Once an ideal position is identified and selected, a company should develop a market entry plan acknowledging the risks, threats and opportunities in the short-term and long-term. Then, once this business strategy is organized, use that analysis to assist in the design and development of the virtual space and experience.
In order to encourage business leaders, members of the C-suite and valued stakeholders to embrace expansion into the metaverse, such due diligence must also include considerations unique to the complexities and ever-changing trends driving the participation and value in the metaverse.
To understand how the process of entering the metaverse differs from entering new markets in the real world, let’s review the qualities and characteristics creating such distinctions and why they will be important to company leadership and valued stakeholders.
The volatility of virtual investments
When a company is determining, how to enter a market in the real world, geographic, demographic and consumer behavior data drives the decision-making process. In a virtual space, the information to form such conclusions remains minimal by comparison.
Though the data is easily available through the virtual platforms, the companies should consider their virtual space an investment with high volatility. Many companies looking to acquire property or space in the metaverse may want to turn to virtual real estate agents to secure the most coveted locations and minimize the risk of their venture.
Not only will this professional advice and assistance create more security in the speculation, but additional consideration of the use, design and experience that will be offered prior to making any capital investment will lessen the concern and increase the opportunity.
Where are you?
In virtual world platforms like Decentraland, Sandbox and others, there are virtual planets and plots of virtual land available for purchase that range from tens of dollars to hundreds of thousands and in the most bizarre cases millions. These parcels are sold as NFTs backed by blockchain and once purchased are developed, rented, or simply held on to in hopes the land or property appreciates. If you’re a business making this virtual investment, appreciation shouldn’t be the primary focus.
The priority of greatest importance to brands building in these virtual spaces is the ease of being found. Where are you? How do consumers find you? This issue mirrors that of the real world. To help overcome this challenge, one approach is to have a strategy focused on the accumulation of multi-parcel properties, making it easier to be located and offering greater options in the creative design and development process.
These “districts” or “estates”, depending on the platform the vocabulary changes, will be easier to locate on the virtual map for users. Just like the location of major brands at shopping malls, the value in location is both in size and proximity to additional audience-driving brands or virtual experiences.
If the virtual world experiment is successful, it will be because of superior immersivity. Concerts, movies, sporting events and consumer experiences must offer interactivity and wholistic engagement that makes the real world appear dull and lacking in possibilities by comparison. While entertainment companies will more easily master the metaverse experience offered to audiences, brands and businesses in the vast majority of other industries will likely struggle to conceptualize and develop the level of immersivity that will be required to be effective.
Healthcare, education and financial services could all prosper from virtual properties and offerings – medical professionals seeing patients and patients building communities of support, classrooms that are not confined to textbooks but bring subject matter to life for greater curiosity and stock markets with available real-time multidimensional metrics that make Bloomberg terminals appear outdated.
These virtual theme parks of consumerism and participation allow for brand reinvention, offer the possibility for novel sources of revenue and obviously skew to a younger audience that may not have yet come across or interacted with these same brands in the real world.
How long before Progressive or Geico offers a virtual insurance policy to protect from car crashes in the metaverse? Can Bank of America or Wells Fargo teach customers about financial responsibility more easily through an interactive explanation in a virtual bank? When will physical therapy include metaverse meetings with specialists, who can monitor the progress of the patient?
Companies and organizations that currently don’t see a future in this Web3 world will eventually make such a pivot, only to recognize the opportunities that have existed the entire time. To effectively produce the best results from these ventures, being disciplined digital investors, focusing on location and ease of visibility and committing entirely to superior immersivity will distinguish the winners from the rest.
Wyatt Ferber has spent the last 10 years building digital communities and platforms at CBS, FOX and more.