This Week in the Metaverse (W48.2022)
The Big Read - How Can Brands Enter The Metaverse; Latest on Into The Metaverse Podcast; Other News from Around the Metaverse
Welcome to Letters - commentary, analysis and ideas from Into The Metaverse.
The Big Read - How Can Brands Enter The Metaverse
Latest on Into The Metaverse Podcast
Other News from Around the Metaverse
Let’s dig in!
(1) The Big Read: How Can Brands Enter The Metaverse
IAB (The Interactive Advertising Bureau) released a guide for brands to help kickstart their marketing efforts in the metaverse, designed to help marketers assess their options. The report includes some definitions, an overview of current metaverse-type platforms, and several use cases (access the PDF here).
The guide does a solid job at providing high level overview of several key metaverse-type platforms (e.g. Roblox, Fortnite Creative, Decentraland) as well as presenting a few use cases to show how some brands have used these platforms to experiment and connect with audiences on these emerging platforms. However, the sections that aim to provide more concrete guidance and suggestions are relatively light on content and leave a desire for much more though it’s a solid base to work from.
Why It Matters
With the metaverse remaining at a very nascent state, trailblazing brands are entering the space and experimenting rapidly with what this new frontier means for their brand and how can 3D virtual worlds connect them with their audiences in new ways, establish a connection with new audiences, and discover possibilities to grow their reach and revenue. That being said, given the nascent stage of the category, there is a growing need to help marketers not only better understand what the metaverse is (or could become), but also, and perhaps more importantly, what it means for them and for consumers and communities.
It’s wonderful to see organizations like IAB (and others like Citibank, McKinsey) helping to build the case and provide more educating information about this emerging category, and I’ll use the opportunity to re-share a letter I wrote a few months ago about:
How Can Brands Enter The Metaverse
State of the metaverse and the impact on consumers
We are at the very early stages of an emerging metaverse. While the consensus on what exactly the metaverse is continues to form, as a company builder and creator in the space I subscribe to the view that at its core, the metaverse promises to evolve the human experience on the Internet in three profound ways: (1) Immersion - A 3D Internet that will enable people to feel embedded within experiences versus just casually interacting with them; (2) Hyper Social - The metaverse will allow people to co-experience the virtual realm at a much larger scale, enabling them to form deeper connections that feel more similar to real life; (3) Expression - it will give people the ability to manifest their personality through the lens of a 3D avatar as they navigate these immersive, hyper-social virtual spaces.
In its current state, while the metaverse I described is not entirely here yet, it is nonetheless near. We might be years away from the fully realized vision, especially when it comes to interoperability between different platforms that offer metaverse-type experiences, but certain elements of that vision are gradually materializing. Today we have early metaverse platforms that, while don't yet "speak" to one another, are already giving users the opportunity to feel immersed, socialize at a large scale, and express themselves through their 3D avatar. Roblox is a great example of that. Its 58.5 million daily active users (as of July 2022) not only spend an estimated 2+ hours a day on the platform, but are also interacting through a diverse portfolio of experiences – games, virtual concerts, and brand worlds – jumping freely from experience to experience using an avatar that is the virtual representation of them (1 out of 5 Roblox users change their avatar outfit every day).
While some might think of these emerging platforms (e.g. Roblox, Fortnite, Minecraft) as purely "games", for the global audience that is immersed in these experiences it is much more than a "game." It is the virtual parallel of "living" IRL. The generation of Internet users who were born after the year 2000 is using these proto-metaverse platforms to play, socialize, make friends and express themselves in many different ways. For a 10 year old girl in Columbus, Ohio, Roblox is a place to hang out, play, chat with friends and purchase awesome outfits for her avatar.
The metaverse is transforming personal expression
Expression 1.0 was based mostly on written content during the early days of the Internet (1990-2005). Blogs and forums were the only outlets for online expression (e.g. Blogger). When social media entered the scene around 2004-2005 (Facebook, MySpace), it enabled people to express themselves through social feeds and photos (Instagram and Snapchat at a later stage) as well as video (YouTube and nowadays TikTok). These experiences were, and still are, experienced primarily through a 2D gateway. This was Expression 2.0 and it was powered by the explosion of smartphones as the primary medium for people to connect, play, and express themselves. In the mid-2010s, we started to see the rise of 3D-based social platforms, initially revolving around games (Roblox, Minecraft) that went hand in hand with user-generated content (which started with YouTube at mass scale). While 3D worlds had already existed for a long time in the form of video games (World of Warcraft, Grand Theft Auto, and others), platforms like Roblox allowed users to actually create virtual worlds and experiences for other users (UGC) taking it to the next level with the introduction of avatar identity as the centerpiece of virtual human existence within a 3D world (albeit for a younger audience).
I believe that we are now accelerating towards the transition of the Internet into a 3D space where our avatars become an even more dominant modality for interaction and expression - Expression 3.0. Being immersed in a hyper-social virtual world surrounded by other people gives you a different sense of presence, it's closer to feeling like you are in an actual place. You have full autonomy over a 3D avatar that is essentially your "self" in this world. Others can see you, and you can see them. Having a full-on personification of your virtual presence, through which you attend games, concerts, and social events, might make you want to invest a little time in making that avatar feel like you. You are no longer a static profile picture -- you are actually there, walking around, emoting, interacting with others. For this reason, it's likely that people will begin to treat their virtual existence with as much care as they do their IRL identity. I suspect that by the end of this decade, millions of people around the world who access the metaverse (or at least metaverse-type platforms) will invest significant time and resources in the look and feel of their avatar identity (or even create multiple identities). This means that many more users will purchase and invest in outfits, accessories and other virtual goods for their avatars, potentially matching the amount of money they spend on IRL goods. Metaverse builders and communities refer to this trend as Direct-to-Avatar (D2A).
Opportunities for brands
The metaverse is a paradigm shift when it comes to consumer behavior. Covid-19 accelerated the trend of treating virtual spaces with the same level of importance as physical ones. While platforms like Zoom became the go-to modality for millions of people (across work, social, entertainment, education, and more), 3D virtual worlds on the other hand, which up to that point were primarily accessed by gamers and/or young people, not only grew tremendously in usage but also became a prototype for what the future of the Internet could look like - what we are now calling the metaverse - and with that, attracting many more millions of people to show real interest in figuring out what this means for them - and with that, attracting many more millions of people to show real interest in what this means for them.
Brands, small and large, are starting to understand that we're witnessing a paradigm shift in real-time. They are starting to see that this is where millions of consumers are spending their time, and if they want to connect with them on a deeper level, they need to have a presence in the metaverse. While some brands are already investing significant capital into creating persistent virtual worlds of their own on platforms like Roblox and alike, many more brands are experimenting with different types of activations as a way to dip their toes into the space, and most brands that haven’t started to experiment with these platforms state that the metaverse is on their radar.
When assessing opportunities for brands in the metaverse, it is important to emphasize that the space is still very nascent. A lot is still undefined, so an experimental mindset is essential and brands must have a clear point of view on what they are trying to achieve. They must have a clear perspective on why they want to establish a presence in the metaverse. Is it about positioning the brand as pioneering innovators? Raising awareness with a different kind of audience? Establishing a relationship with a new generation of consumers? Testing new ways to monetize their intellectual property by selling avatar cosmetics? These are all solid reasons to enter this emerging space, but having a strong intention is crucial to developing an experience that is authentic to both the brand and the platform itself.
Brands - here’s where and how you can start
With all the hype around the metaverse, especially when it became intertwined with web3, it becomes difficult for brands to understand when, where, and how they should experiment with these brand new mediums.
When I meet brands that are interested in establishing a metaverse presence, some have already made a choice on which platform they would like to enter, but many are in an even earlier exploratory stage, where they simply know they want to do something in the metaverse. Regardless of which side of the aisle you are on as a brand, our advice to brands is to start with “why” - why is it important for your brand to establish a metaverse presence? Then, what would you like to accomplish and what does success look like for your brand? It is essential that as a brand, you can identify and prioritize your objectives – this is such a malleable medium that the final product could take shape in many ways, so clear objectives are key to launching something that will be effective for your brand . The third question is, what level of investment are you willing to make and what level of risk are you willing to take? The answer to these questions will help you assess which platform or channel is the right fit for your strategic rationale, objectives, and budget.
To be successful entering the metaverse you must create a starting framework based on the pillars above, alongside a partner that can help you plan, build, deliver and sustain. It's a new frontier. The unique and complex reality about the metaverse and all of its current platforms is that building an engaging 3D experience is unlike any other digital experience that brands may have created in the past. Creating an engaging and differentiated 3D virtual world requires a multitude of capabilities that until today were mostly associated with the creation of video games - art, engineering, design, production, live ops (among others) to bring to life an interactive experience that will delight users. Yes, it is complex, but it will gradually become the norm and the de-facto modus operandi for many brands and enterprises.
Today brands can establish unique virtual worlds and experiences on a multitude of platforms - Roblox, Fortnite Creative, Minecraft, The Sandbox, Decentraland and Horizon Worlds, to name a few. Without getting into the many nuances of the different platforms (that’s for a different essay), the question is what can brands build today? (1) If you just want to experiment and make a splash, you can launch a limited-time brand activation. This is a brand experience that is in live-mode anywhere from one day to one month. This would be a small-scale virtual world best suited to serve short-term activations, product launch parties, promotional events or a virtual iteration of an ad campaign. (2) If you want a larger-scale experience and grow it gradually, you can launch a game event - a longer time-bound experience (between 1-3 months) that contains an array of gameplay experiences inspired by your brand, centered around world exploration and an innately social gameplay loop. And (3) if you know what you want for your brand and are ready to invest more significantly, I recommend that you go “big” with a persistent brand experience - a full-scale virtual world with more intricate gameplay that is designed to stay live indefinitely and grow consistently. It’s an always-on experience with frequent content releases and updates, with the goal of becoming a go-to experience that players return to again and again. Each of these options can be massively successful in their own right, and the “right” approach depends heavily on the brand’s objectives, strategic rationale, and budget.
The metaverse is not yet here, but it's near. The best time to start was yesterday. The next best time is today.
(2) Latest on Into The Metaverse Podcast
Listen to episode 34 with Neil Trevett (NVIDIA, Khronos Group, Metaverse Standards Forum).
Joining me today is Neil Trevett, Vice President of Developer Ecosystems at Nvidia, President of Khronos Group and Chair of the newly established Metaverse Standards Forum. We cover in detail why standards how vital for the metaverse to emerge and what could happen in its absence.
What is the metaverse by Neil:
Most people have some kind of core vision that the metaverse is gonna be a combination of the connectivity of the web with the immersiveness of spatial computing at its essence.
The one thing Neil wants the listeners to take from our conversation:
Don't get trapped by the hype and don't get trapped by. The talk of dystopia. If you can and actually focus on the reality of these technologies are coming together and there is going to be this continual wayfront of opportunity. As we figure out how to bring all these elements together, focus on what that could mean to your organization here now. Today, or at least in a short to medium term, because there are gonna be opportunities, not just people building metaverse, but using this metaverse, whatever it's gonna be. And it may not be called the metaverse so much longer, who knows? But it doesn't matter. It's these technologies that are coming together and creating new opportunities. Just like the web was transformative. And when the Netscape browser was launched, no one predicted what the web was gonna turn into and where the opportunities were gonna be. We're on that same journey again. Don't be left out but don't get caught up in the hype either.
On: Apple / Spotify / Google / Anchor / YouTube.
(3) Other news from around the metaverse
Mark Zuckerberg Says Apple Holds Too Much Control Over App Ecosystem (link, paywall) - Meta chief executive remains optimistic about his company’s metaverse products and services.
How generative AI could create assets for the metaverse (link) - interview with Jensen Huang, CEO of NVIDIA.
Deadmau5’s Pixelynx Unveils NFT Scavenger Hunt: ‘Rock Band Meets Pokémon Go’ (link) - Pixelynx, a music metaverse startup co-founded by Deadmau5 and Richie Hawtin, has launched part of its Elynxir game this week. An augmented reality scavenger hunt will take place in Miami, and winning players will help control a virtual music act within Elynxir.
Mozilla acquires Active Replica to build on its metaverse vision (link) - Mozilla announced that it snatched up Active Replica, a Vancouver-based startup developing a “web-based metaverse.”
NFL continues metaverse exploration with persistent Fortnite experience: NFL Zone (link) - The National Football League announced the launch of NFL Zone, a multifaceted, dynamic metaverse experience built in Fortnite Creative. Presented by Visa, the NFL's Official Payment Services Technology Partner, NFL Zone is designed to engage existing fans while increasing fan discoverability through an NFL-inspired social hub for Fortnite players and NFL football fans alike.
AWS SimSpace Weaver can run city-sized simulations in the cloud (link) - Amazon unveiled AWS SimSpace Weaver, a computing service that allows developers to run city-sized simulations at scale in the cloud. The service is designed to free simulation developers from the constraints of their own hardware.
Sony is getting into the metaverse with a new motion-tracking system (link) - Mocopi is completely free of wires or base stations, allowing users to control a virtual reality avatar from any location.
CommonGround raises $25M for immersive video avatar technology that doesn’t rely on VR gear (link) - An Israeli/Silicon Valley startup that has built technology for people to use their smartphones to scan their faces for responsive, real-time three-dimensional avatars that can be used in video applications — has raised $25 million, money that it is using both to continue developing its tech and getting it launched into the world.
Business schools explore teaching in the metaverse (link) - Institutions are venturing into virtual worlds — both as a subject and a learning tool.
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Into The Metaverse is a multi-segment podcast show that covers companies, technologies and trends through deep interviews with the brilliant minds who build, create for, and invest in the metaverse.
Into The Metaverse covers companies, technologies and trends that are bringing this promise to life. Yonatan Raz-Fridman “Yon” (founder & CEO of Supersocial) interviews the brilliant minds building for, and investing in, the Metaverse.