Big Brands Are Entering the Metaverse, But is it Too Early?
New technologies typically follow a predictable adoption pattern, with the earliest adopters typically considered the risk-takers and innovators that lay the foundations for further waves of adoption.
These early players take on the greatest amount of risk but if they play their cards right, they can establish themselves as pioneers — capturing new audiences, unlocking new revenue streams, and gaining a competitive edge over their rivals
Now the metaverse, that is, the expansive digital landscape poised to become the successor to the worldwide web is quickly being established as the next frontier for innovation — with major brands taking notice and ramping up their metaverse development efforts.
Here, we take a look at who some of these early movers are, and examine the implications and trajectory of this promising new medium for creativity.
A wide variety of popular brands have already begun dabbling with the opportunities presented by the Metaverse — these include Coca-Cola, which launched its own non-fungible token (NFT) collection back in July 2021, raising over $500,000 for charity in an online auction.
Other heavy-hitters, including Gucci and Louis Vuitton, have also begun leveraging the metaverse and related technologies for their marketing efforts.
Gucci was one of the first major brands to make moves in the metaverse after it collaborated with the popular online game creation software Roblox to create and sell limited-edition virtual bags and items through the Roblox platform. Although The Gucci ‘Queen Bee Dionysus’ bag sold for just 475 Robux (at the time ~$5.50), one later resold for a staggering 350,000 Robux (~$4,100) — which is more than its real-world equivalent. The event not only resulted in a great deal of exposure for Gucci, but also demonstrated the potentially lucrative opportunities the metaverse could unlock.
The popular fashion house Louis Vuitton also made headlines back in August when it thoroughly embraced the metaverse by launching its own metaverse-inspired NFT-enabled game — known simply as “Louis The Game”. The game includes a variety of digital collectibles that players have a chance of winning as they progress through its levels, including a variety of NFTs that were designed by the renowned digital artist Beeple. It is widely expected that these NFTs will be worth considerable value when they hit open markets.
A huge number of other major brands have also started building out their presence in the metaverse — doing what they can to appeal to Generation Z and the rapidly expanding crypto-savvy and Web3 crowd. This includes the popular soft drinks manufacturer Pepsi; apparel and clothing brands like Burberry, Nike, Adidas, and Balenciaga; and a wide variety of fast-food chains like Chipotle, McDonald’s, and Wendy’s. Nonetheless, most of their interactions with the metaverse can be considered rather tame, allowing these brands to test the waters before diving in further.
The rampant interest among major brands is beginning to reach a fever pitch, and many household names have now either already experimented with metaverse technologies like blockchain, Web3, NFTs, and digital assets, or they’re paying close attention — with many more major brands set to deliver their own metaverse-based products and experiences in the coming months.
Given that major brands can have tens to hundreds of millions of dedicated followers and fans, they could be set to become some of the key drivers of metaverse adoption, spurring users to begin experimenting with and joining the metaverse to access their products. In time, there could come a point where all major brands and businesses have a metaverse presence, similar to the way that the vast majority of major businesses now operate at least partially online.
Although most major brands saw a positive response from their respective communities after dipping their toes into the metaverse, it hasn’t always been smooth sailing.
Despite arguably kickstarting the metaverse revolution by rebranding to ‘Meta’ and committing to spend $10 billion on its metaverse project, Facebook suffered a great deal of pullback from investors. Since reaching a high of over $382 in September, Meta Platforms, Inc’s share price has collapsed by close to 13%, with its change in direction doing little to stem the drop.
Likewise, the developers behind the long-anticipated STALKER 2: Heart of Chernobyl first-person shooter game recently backpedaled on plans to introduce NFT functionality to the game. These NFTs were initially set to provide additional, non-story-related content to players that purchase STALKER NFTs at auction. However, the game developer GSC Game World faced immediate backlash from STALKER fans, who argued that this was simply a way to extract more money from the community while providing little to no additional value.
The popular gaming-centric chat client Discord faced similar blowback last month when it scrapped internal plans to leverage the Ethereum blockchain to power a range of new services by integrating support for the popular Web3 wallet Metamask. Discord Founder and CEO Jason Citron later clarified that there are no current plans to ship this feature after igniting the fury of its community over Ethereum’s massive energy burden.
Even traditional gaming companies like Sega and Ubisoft have suffered criticism over their interest surrounding non-fungible tokens, with critics arguing that the energy issues completely undermine any benefits of adding NFTs to their games.
Nonetheless, growing pains are present in most nascent industries. These are often solved by further developments and innovation, and many of the aforementioned sticking points have already been overcome.
The Road Ahead
Just like how Robert Metcalfe, the co-inventor of Ethernet and an early internet pioneer, erroneously predicted the demise of the internet in its earliest days with his now infamous quote: “I predict the Internet will soon go spectacularly supernova and in 1996 catastrophically collapse,” published in an InfoWorld op-ed in 1995.
We are likely to see a variety of similar quotes in the coming months, as traditional firms and external analysts continue to underestimate the impact and disruptive potential of the metaverse. Nonetheless, as the infrastructure for the metaverse is gradually built out, and the utility, desirability, and accessibility of metaverse-based services improve, the tone will inevitably begin to change.
As has already been seen with the meteoric expansion and development of crypto infrastructure, the growth of novel technologies generally isn’t linear, but rather exponential. As a result, we will soon see an inflection point, where more people interact with the metaverse than do with the present-day web2-based internet. And it might only take years, rather than decades, thanks to a more rapid development cycle.
Some of the main innovations from the crypto sphere will almost certainly spill over to the metaverse space, including low energy consensus systems like proof of stake; decentralized governance schemes; carbon-neutral NFTs; play-to-earn incentive systems; decentralized identity (DID); decentralized real-estate solutions; and more. In line with this, the metaverse will likely be initially bootstrapped into existence by co-opting pre-existing technologies — with new innovations layered on top.
Even famed tech pioneer and philanthropist Bill Gates is hopeful about the technology and went on record to state that he believes the metaverse is the future of digital interactions.
“Within the next two or three years, I predict most virtual meetings will move from 2D camera image grids — which I call the Hollywood Squares model, although I know that probably dates me — to the metaverse, a 3D space with digital avatars,” said Gates in a recent blog post.
That said, in order to truly capture the attention of the masses, the earliest movers and innovators in the metaverse will need to lay down the framework and infrastructure that makes adoption not only simple, but desirable for brands, businesses, and individuals. Once this is accomplished, the metaverse will grow in leaps in bounds.
About Master Ventures
Master Ventures is a blockchain-focused venture studio helping to build the next generation of blockchain-based Web 3.0 system innovations within the crypto industry. Launched in 2018 by Founder and CEO Kyle Chassé, the company’s ethos can best be summarized in the acronym #BeBOLD: Benevolent, Open, Love, Decentralized.
Master Ventures co-creates with entrepreneurs and businesses worldwide to turn the best ideas into innovative and disruptive products. They do this by investing as strategic partners through offering advisory services to the projects they believe in. To date, Master Ventures has invested in over 40 crypto projects, including the likes of Kraken, Coinbase, Bitfinex, Reef, DAO Maker, Mantra DAO, Thorchain, and Elrond.
For any questions, please feel free to reach out to us on: