Metaverse - Untangling The Confusion
While at the onset of Covid 19 with the
lockdown dropped on us like a bomb, many retailers scrambled to keep the lights
on. Several organizations globally went belly up while others showed renewed
vigor. According to McKinsey Global Fashion Index (MGFI), in the retail sector
itself, a record 69% of companies were value destroyers in 2020 compared with
61%in 2019. About 7% of companies left the market entirely, either due to
financial distress or because they were acquired by rivals. Organizations
that had consistently invested in innovative ways to keep the channels of
interaction open with their customers, are now reaping the benefits as the
markets ease out. As Covid restrictions were easing out most unvaccinated
people were still not comfortable physically shopping. Brands that invested in
Live Commerce technologies started emerging out the dark much faster. Live
steaming of events, ability to speak with a preferred store associate who
helped in guided selling & social shopping with virtual screens were life
savers as were. When factories opened for business and the availability of
robot based automated inventory counting helped run production seamlessly.
Recently Salesforce ran a survey
with 15000+ consumers and business buyers across 27 countries. 62% of the
customers indicated that their experience with one industry influence their
expectation from the other. This is how they ranked the best and worst
performing sectors across key criteria
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Innovation |
Customer Centricity |
Product Quality |
Service Quality |
Responses to 2020 crises |
Social Responsibility |
Envt Responsibility |
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Top 3 |
Technology |
Healthcare |
Healthcare |
Healthcare |
Healthcare |
Healthcare |
Nonprofit |
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Automotive |
TTH |
Technology |
Technology |
Technology |
Nonprofit |
Healthcare |
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Communication |
Retail |
Consumer Goods |
Communication |
Consumer Goods |
CPG |
Manufacturing |
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Bottom 3 |
Nonprofit |
Manufacturing |
Financial Service |
Financial Services |
Financial Services |
Media |
Communication |
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TTH |
Financial Services |
Media |
Media |
TTH |
Financial Services |
Financial Services |
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Govt |
Govt |
Govt |
Govt |
Automotive |
Automotive |
Media |
Figure1: Best and Worst Performing
Sectors in the Eyes of the Consumers
Retail is conspicuously missing as a top innovator despite the plethora of innovation it triggered during the Covid crisis. We saw emergence of Curbside Pick up, Virtual Trial, Bar codeless Self Checkout powered by computer vision, BOPIS. Smart Shelf technology, Circular Commerce, Algorithmic Retailing, Reverse Logistics, Microfulfilment, Appointment Scheduler, AR based Shoe Try On, Digital Stylist and a lot more. In the last few years, technology driven innovation simply accelerated to a different level making way for discussions on 5G, Quantum, NFT and Metaverse more mainstream. In 2021 start ups in the US raised $300 billion almost double the amount raised in 2020. More tech startups crossed $1 bn in valuations than the previous 5 years combined. Hundreds of technologies are emerging in tandem that will be used to build transformative products and platforms. The key to success is, identifying the blockbuster in the maze. Metaverse is evolving to be a big bet and retailers globally should take note. Who would have thought that OpenSea, a company that lets people buy NFTs, can be valued at $13.3 bn? Citi has predicted that the Metaverse economy could be $13 trillion by 2030 while according to Morgan Stanley just the NFT market will be $240 Bn in the same time horizon. Did you know that Barbados was the first country to open an embassy in Metaverse?
Metaverse is nothing new. The term was coined in 1992 by Neal
Stephenson in his book “Snow Crash”. Research on Metaverse components have been
ongoing over the past 30 years and saw a recent spike interest with Facebook
being rechristened as Meta. An apt time change the brand name and add to the
confusion around Metaverse. Is Meta Metaverse? No, it is not but will be a
formidable player in building the ecosystem along with Microsoft, Google, . The
Metaverse confusion took an awkward turn when, in an interview Elon Musk
quipped and questioned the validity of Metaverse. He said “strapping a frigging
screen on their face all day and not wanting to ever leave”. But does Elon Musk
have a motivation to be skeptical about Metaverse? Maybe he does and he has a
different future in mind with Twitter in his portfolio and Neuralink ready for
human trials.
Nonetheless, Metaverse is real
and we have seen in the past how innovation triggers have been fast discounted
that eventually ended up being blockbusters. The time is ripe to hold the Metaverse
bull by the horn. Metaverse is our stepping stone from Web 2.0 to Web 3.0 and
it thus becomes important to understand what it entails. From an early vision
of developing Metaverse as a multiplayer AR/VR driven gaming universe it is
slowly evolving into a hyper-connected 3D virtual environment (not necessarily
using AR/VR sets) driven social space, operating under evolving social
contracts and where people can design their avatars, meet others and hang out,
socialize (VR Chat) and experience an immersive life that includes a plethora
of activities like gaming (P2E games in Sandbox), live streaming (Twitch),
virtual commerce (NFTs), asset ownership (real estate), financial services
(decentralized finance using smart contracts by companies like NFTFi), event
hosting and participation (Fortnite), eSports (ESPORTS ONE), advertising,
corporate virtual meetings, recruitments to name a few. Metaverse’s biggest
differentiator is the element of ownership and democratization of content, two
attributes Web 2.0 gaming platforms didn’t offer. In the games developed in the
Web 2.0 world, control was vested with the gaming companies. Not only
gamer was locked into the hardware but a license was mandatory to play a game.
Additionally a player, despite the initial investments, had no control over the
games as most were preprogrammed to execute a finite set of tasks. The game
owners were helpless against upgrades and game retirements and in the end owned
nothing from a streak of wins. In a Metaverse, participants can own their
digital identities, own assets they have created or buy assets from others and
trade those for real life fiat currencies through conversion platforms. The
technologies are driving forces behind Metaverse – GUI, Game Studios,
Blockchain and Web 3.0. Currently majority of activities in the Metaverse
revolves around gaming and NFT investments.
The Metaverse is synonymous with
NFTs and blockchain is it’s lifeline. NFT’s are non fungible tokens on the
internet that grants exclusivity to an owner of that asset. NFTs are
certificate of ownership that allows one to own items on the internet through
smart contracts created with blockchain technology. The advantage with NFTs is
that it is very easy to verify a claim of ownership. The NFTs are bought
through in-game currencies like $MANA (Decenterland), $SAND (Sandbox), $AXS
(Axie Infinity), $ALICE (My Neighbor Alice), $GALA (Gala Games) & $PYR
(Vulcan Forge).Built on Blockchain technology at its core, each Metaverse has
its own token with which participants can buy NFTs like avatars and profile
pictures, land and collectibles, digital art, can take loans against these
NFTs, can trade in cryptos, build games and collectibles and sell those on the
platform to earn more tokens, participate in major events like Fortnite
Metaverse concerts, buy music and gaming items etc. The possibilities are
limitless. In its mature form, all Metaverses should be interoperable and built
on open source technologies.
Metaverses are currently open or
closed. Games that are popular in closed Metaverses and are available for
gameplay on PC, Xbox, Playstation, Nintendo etc include Red Dead Redemption
(Rockstar), Counter Strike (Valve), GTA (Epic Games), Fortnite (Epic Games).
Closed Metaverses lack blockchain interoperability and generally have
centralized ownership. Whereas environments like Decenterland, Sandbox, Axie
are open world metaverses that offer interoperability and are
inclusive. In open Metaverse games when a player owns a token the player
automatically becomes a member of the DAO (Decentralized Autonomous
Organizations) that is equivalent to shareholder rights in the real word.
Currently the data in most of the Metaverse games are governed by DAO and not
organizations with centralized control like Meta, Microsoft, Sony, Epic Games
et al. In the games developed under Web 2.0 framework, in game data is owned by
the game company. We have come a long way from being a consumer of
content in the Web 1.0 era of Netscapes and Hotmails to being Prosumers in the
immersive virtual worlds.
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Web 1.0 |
Web 2.0 |
Web3.0 |
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Interact |
Read |
Read-Write |
Read-Write-Own |
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Medium |
Static Text |
Interactive Content |
Virtual Economies |
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Organization |
Companies |
Platforms |
Ecosystem |
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Infrastructure |
Personal Computers |
Cloud & Mobile |
Blockchain Cloud |
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Control |
Decentralized |
Centralized |
Decentralized |
Figure 3: Evolution of Web (Source:
Grayscale)
If we are to assume that the future of
large sale consumption will lie with the Millenials and GenZ, it is easy to
understand why is it becoming imperative for organizations to seriously
consider their investments in Metaverse. Today there are more than 3 billion
gamers online. Digitally fluent generations spend upwards of 3 hours a day
scrolling on the internet.
The focus on monetizing the gaming
industry erupted from the success of Roblox. Roblox, unlike its previous
avatars like Nintendo, Sony PSP, Xbox et al, is an online gaming platform and
storefront where people play games built by the players themselves. Roblox
alone has close to 40 mn games with 49.5 mn daily active users. The advertising
reach is just mind boggling. Developers can earn about $ 1mn by
converting their in-game token Robux into real money through Developed Exchange
(DevEx) program. Roblox went public in 2020 that listed at $45 and recorded a
closing price of $69.50. “Adopt Me”, a pet simulation game in Roblox recorded
1.6 mn concurrent uses in April 2020 and had been visited by players 20.4 bn
times (Source: Polygon.com) The success of Roblox had a snowball
effect on Metaverse. Metaverse is the next version of Roblox that not
only offers the players an opportunity to earn, it offers an immersive
experience that mimics the real world with the help of naturalistic
interfaces. Decenterland has about 300,000 active users, Sandbox with
about 2mn registered users. This is just the tip of the iceberg as currently
there are a few hundred metaverses including Treeverse, Blocktopia, Somnium,
Cryptovoxels, Star Atlas, Uplift World. Each of these Metaverses have their own
blockchain based currencies referred above.
The currencies are used to buy NFTs. To get a sense of how vibrant the NFT market is, the attached image will suffice. This is simply a small snapshot from a list of at least 100 top NFTs
Figure 5: Sliced 7 days average NFT trading data on OpenSea
The true power of Metaverse manifested
in the recent Marshmello, Travis Scott & Ariana Grande’s in game concerts
on Fornite and Retailers took notice. Marshmello made history by performing the
first ever concert in Fortnite Metaverse that boasts of 200 mn members. In July
2020 Travis Scott ran his “Astronomical Tour” that clocked 45 mn visitors in
their avatars. Travis Scott earned approximately $20Mn for his video game
appearance plus brand endorsements. It doesn’t end here. His Youtube channel
for this event shows 184 million views with 3.3 million likes. Travis Scott’s
Giant avatar wore a Nike Air Jordan sneakers. The sneaker skin sales went
through the roof, an inflection and rethink point for brands who just realized
that they need to go back to their drawing boards on Met
The idea of Metaverse is evolving and in it’s journey it is learning and absorbing the best of everything. The introduction to the concept of Metaverse has been curated with precision. The excitement was built gradually over time through complementary triggers like books and movies, a stark similarity with how the governments are slowly releasing UFO files. One cannot discuss Metaverse gaming without appreciating Ready Player One, Forza Horizon 5, Itzy’s Zepeto Studio production of Not Shy three diverse content categories that took the GenZs by storm. The vision of Metaverse was aptly projected in Ready Player One, a 2016 movie that fast forwards our life to a 2045 dystopian world where we could be transported with Wade, the protagonist, to a place called Oasis. Oasis is a world where the limits of reality are only limited by our own imagination. Oasis was created because it gave humans the options TO DO whatever they couldn’t in the real world and an opportunity TO BE what one could not be. While in the real world one could be discounted as insignificant, in Oasis, the person could be the ultimate hero who saves the world from destruction. Social research shows that the 2 digitally native consumer cohorts, Millennials and GenZ, are increasingly feeling disenchanted with that is forcing them to take refuge in the internet. For us to make Metaverse successful, we need to understand the psychological construct of these 2 cohorts . An online survey run by Kapersky Labs and Censuswide was an eye opener in understanding the psyche of GenZ and our hypothesis on the success of Itzy’s “Not Shy” video uses 3D items and Avatars to virtually engage with their primary audience targets – the K Pop frenzied Millenials and GenZ . It’s a whole new level of immersive engagement between artists as their fans where 5 members of Itzy wear 3D body suits that allow themselves to be projected on the screen as part of a music video as 3D characters that can be customized according to the user’s wishes. The key highlights of the study were
- 87% of GenZers are
always anxious
- 45% feel anxious
about their appearance which explains why 57% spend most of their time on
online interaction through social media platforms
- 32% are anxious about
their friendship and admit continuing them from fear of being bullied and
isolated. 21% are anxious about cyber bullying
- 41% said that they
feel anxious about future careers while 37% identify lack of money as a primary
concern. Metaverse opens the door to handle both concerns (Balthazar, an NFT
gaming community conducted a detailed survey in March 2022. The Community
Insights reports showed that 1 in 3 or close to 32% of the respondents were
ready to lave their full time jobs to play NFT games full time)
- GenZ is obsessed with
image crafting. Kapersky study found that GenZers usually post ~50% of the
pictures that they capture is social settings. They take an average of an hour
to craft and curate these images. The level of curation is only a reflection of
the amount of unrealistic pressure of positive association social media is
putting on these kinder minds
- Telstra’s Talking
Loneliness Reports highlights something alarming. 54% GenZ-ers & 51%
Millennials regularly feel lonely.
Although by its classical definition X Box’s Forza Horizon 5 may not currently fall under the category of “Metaverse” because it is still a PvE “simul-arcade” racing game that has attracted an enormous numbers of players who normally cannot be categorized as gamers. Forza Horizon 5 is a hybrid between a standard subscription based multiplayer and a Metaverse with it’s ability to offer a player an opportunity to express boundless creative freedom by designing and personalizing custom vehicles, exploring 11 exotic biomes and terrains where these worlds evolve over time with day and night cycles & dynamic weather pattern changes, the ability to set difficult targets and accomplish those and tremendous amount of control, freedom and choice over how to play the game, all characteristics of a Metaverse. It will not be surprising to see Forza Horizon versions in the future to be in Metaverse as they are already influencing Metaverse games to be more visually realistic. Metaverse success is already sending ripples among 2D game makers like Microsoft. Microsoft intends to transform Halo, Minecraft, and Flight Sim games from 2D to 3D world. Minecraft and Microsoft Flight Simulator support VR headsets and allow gamers to use VR to fly planes within a virtual world
Metaverse Will Create It’s Own Demand
Over the last 2 years the rate at which organizational strategies required rethink is unprecedented. The primary reason being proliferation and adoption of technologies and the emergence of the new consumer classes – Millennials and GenZ. The easy availability of wearables like personal health trackers are helping humans coexist with technology. While Millennials and GenZ have been digital native, GenX have found renewed vigor in dabbling with artificial intelligence – smart homes, intelligent wardrobe, driverless cars, facial recognition software, chatbot interactions, self check outs, virtual try-ons, logistics services through drones etc. It would be a cliché to say that technology is now driving business change but it truly is and Metaverse may just be the next big leap we will see for a long time. The power of Metaverse allows us to collapse the idea of time and space and have us be anywhere, at anytime and with anyone in a split second. From flipping thorough 2-dimensional product catalogs to immersive store visits. Sounds like Back to The Future or Minority Report, doesn’t it? Metaverse is probably the biggest tectonic shift we will see in technology revolution since the advent of the internet and it becomes increasingly important to understand the psychology of the cohorts that will drive this hype to a scaled mainstream adoption. But will Metaverse resonate with all demographic cohorts? Probably not and thus it becomes very important to understand the psyche of the new generation of consumers – Millennials and GenZ
Millennials (1981 -1997) today will be between 25-41 while GenZ-ers (1997-2015) will be between 7-25. These are the key cohorts, two back to back generations that consider social validation and recognition as primal drivers if their existence, will dominate consumption of products, services and experiences from a diverse set of industries traversing seamlessly between the digital and physical worlds in the next few decades. There are currently ~2 billion Millennials and GenZ-ers globally. Of these 60% reside in Asia, 400 mn in Africa, 150 million live in Europe and Latin America/Caribbean with the rest in North America. According to Band Equity Young Millennials and Generation Z are the new disruptive economic force that possess $200 bn of annual purchasing power. Although both are digital native (the latter a bit more), their reactions to and interaction with technology and buying behavior are quite different and distinct with few overlaps with GenX-ers. Some behavioral overlaps with their immediate predecessor include digital nativity, personalized experience, empathy, a penchant for convenience like self service portals, chatbots for issue resolution, item availability (pre order of new or out-of-stock items etc), flexible shipping and fulfilment options, consistent engagement and predictive demand fulfilment. To the benefit of retailers both cohorts have no reservation share personal data directly with the brands as long as those translate to offers, deals, and/or discounts. This open a massive opportunity for brands to collect consumer data, build intelligent AI driven decision support systems that’ll help create a more mature direct-to-consumer channel
Millennials have been in the forefront
of activism in the last few years starting from protests in Hongkong to freedom
of speech in India to Greta Thunberg’s activism on environment to voicing
concerns around Ukraine-Russia war. Millennials have been branded as entitled,
irresponsible, gullible, immature and agitated. Growing between affluent Gen
Xers and adaptive GenZers and witnessing 9/11 terrorist attacks,
Global War on Terror, back to back economic recessions squeezing employment
opportunities they have developed heightened macro environmental awareness, information
overload that spawned conspiracy theories and deep distrust in the State.
Millennial thus operate quite differently when it comes to shopping and it
might be worthwhile capturing those behavioral nuances while crafting a
Metaverse strategy.
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Millennials |
GenZ |
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Millennials want their purchases to
make them feel good. They will buy brands that will speak of their
personality. |
GenZ-ers buy experience and not
products and services. They want to be part of what they consume which
reflects on the shift from traditional games to Metaverse games where they
have the opportunity to build games and NFTs and offer those for sale. The
fact that they can be part of DAOs (Decentralized Autonomous Organizations),
is huge. |
|
Millennials value their dollar more
and value products that meet both a logistical and emotional need. |
GenZ-ers like luxury good but they
don’t want those as show off badges. They like luxury for their exclusivity
which supports the popularity of NFTs in the Metaverse. |
|
Millennials prefer to spend their money
on experiences and they are willing to pay extra for it. For Millennials
seamless interaction with the brand and other customers is very important |
GenZ-ers are big on Co-Creation. They
like heavy engagement through coupons, emails and text messages and would
like to be offered customized products and services |
|
Millennials want to be heard and this
they are more vocal on social media than GenX. |
This group was born in a fully
digitized world and prefer minimum human interaction. They consider
technology to be more reliable than humans. Gaming comes naturally to this
generation which has resulted in developing a sense of responsibility to
complete tasks to earn rewards |
|
Millennials are not brand fixated.
They will swiftly switch brands if the other brand offers something that
closely matches their need |
More that brand, gender fluidity
matters to this generation. This is a generation that looks at the idea of
self very differently and are willing to accept “radical” as nuanced. They
will observe, experiment, test and if required enable change. As Identity
Nomads, they do not like brands that label their products as “male” –
“female” |
|
Word of mouth reviews are more
important for Millennials rather than company sponsored testimonials. More
than 1/3 of millennials prefer to wait until someone they trust has tried
something |
This cohort will likely read product
reviews in depth, validate those inputs with trusted sources and then
make a buying decision. “Influencer Identification” is critical to tap into
this group |
|
Personalization and relevancy are key
buying criteria for this group |
They find security in individuality.
This cohort is genderless, unisex and self expressive. They will pay premium
for brands that are able to bring out their individuality. |
|
Depended a lot on influencer
marketing and we saw this a few years back when major brands started opening
up their Instagram and YouTube channels tapping into Influencer followers
through those influencers. |
GenZ-ers do not trust Influencers and
are value centric and ethics is big on their value list. They will actually
look beyond tangible products and assign more weightage to companies that are
following ethical practices |
|
For them, like GenX, shopping could
be a bit binary. They will use specific channels to buy specific goods like
for X they will prefer a departmental store while for Y they might use
Instagram or Facebook. |
Mobile is their native gadget and
they do not assign importance to a channel but a product. They will buy a
widget from anywhere it is available |
In summary, Millennials and GenZ-ers have made the lives of marketeers and product managers very complicated. While in the past campaigns would be designed around channels now each channel has micro segmentation that require curated personalized campaigns and products that built on open ecosystems that allow consumers to seamlessly be producers and vice versa.
Current State of Play in the Metaverse
Metaverse is enabled through a combination of heavy tech – apps and
hardware. In the world of VR and MR we could relive those lives the real life
cannot offer but through customizable Avatar of a preferred design we could
jump right into. It is adrenaline at a whole new level nudging the most primal
instinct of humans – to be the Alpha and always in control of the environment
they thrive in. Web 3.0 (decentralized ecosystems built on AI, ML and
Blockchain) additionally augment with the ownership dimension that is core to
the Millennials and GenZ.
Currently the majority of companies that are investing in
Metaverse are skewed towards being technology companies participating across
different layers of the Metaverse. The dominant players being Meta (Formerly
Facebook), Microsoft, Google, Nvidia, Unity Software & Roblox. Luxury
brands are not far behind either and they are already working with NFT
developers to develop their own NFT collectibles. Gucci is one of the earliest
adopters of Metaverse and was one of the first luxury brands to enter Metaverse
with it’s virtual Gucci Dionysus bag on Roblox for 350,000 Robux or $4,115. In
May 2021, Gucci launched its first NFT fashion film for its Aria collection.
The NFT bid which started at $ 20,000 ended at USD25,000 and the proceeds went
to UNICEF In March 2021 Gucci launched augmented reality (AR) sneakers at
USD11.99 a pair. Luis Vuitton celebrated its founder’s 200th birth anniversary
by launching a NFT game called LOUIS THE GAME on 4 August 2021. Nike acquired
the digital sneaker brand RTKFT on 14 December 2021 where it launched a wide
range of virtual sneakers that Nike patrons can try on. More than 600 pairs
were sold and sales amounted to USD3.1 million on the sneakers alone. British
luxury major Burberry collaborated with Mythical Games to launch its first NFT
as part of a game multiplayer party game called Blankos Block Party. Burberry
launched its Shark B NFT, which is a shark figurine bearing the TB Summer logo
as a limited-edition and in limited-quantity. Balencia tied up with Fortnite
where Balenciaga’s digital avatar called ‘Doggo,’ wears Balenciaga outfits in
the Fortnite arena. Givency partnered with Chito, a renowned graphic artist,
and launched a series of 15 non-fungible tokens. These tokens were monetized
through a seven-day simulated auction on Polygon. In December 2021, JW Anderson
auctioned a Colourblock Patchwork Cardigan from the exclusive Harry Styles
collection on Xydrobe. Tommy Hilfiger tied up with Nintendo to virtually launch
it Fall 2020 collection on a game called Animal Crossing: New Horizons. Avatars
of several models, fashion influencers, ballet dancers, yoga instructors,
television and activist wearing Tommy Hilfger NFT items were invited to visit
the snow-covered “Tommy Forest” for a virtual party hosted by an avatar of
Tommy Hilfiger, wearing a three-piece suit, bow tie and pocket square. Users
could participate in winter activities, shop at an indoor Hilfiger boutique and
plant trees.
It is clear that the biggest differentiation for Metaverse is it ability to be immersive for which users will need appropriate hardware like VR sets and full body suits with sensors that allows haptic feedback, motion capture and biometric recording. Today the cheapest VR headset costs about $299 from Occulus
Every new idea will come with its baggage of skepticism and Metaverse is not exception. There is concern about the environmental impact of Metaverse. NFTs have a significant negative impact on the environment. An estimate suggests that creating a single average NFT generates more than 200 kilograms of planet-warming carbon—equivalent to driving 500 miles in a standard American gasoline-powered car. Recent backlash has erupted within the gaming community over the introduction of NFTs perceived as being “money grabs” that fail to serve the needs of players. Likewise, metaverse marketing campaigns are seen as overly commercialized with celebrities jumping into the bandwagon luring children into unnecessary splurge. Social implications are deep if large number of young people walk away from mainstream traditional jobs. We are already witnessing an era and great resignation and severe shortfall of resources across industries. Games like Fortnite have more than 45 million players and competition induced rage and its natural manifestation as large scale game addiction is children is a matter of concern.
For Metaverse to witness scaled adoption, the supporting technology needs to be ubiquitous, privacy centric, non intrusive and interoperable. Interoperability between blockchain technologies on which these Metaverses are being built is probably most important key success factor.
There are data privacy concerns around Metaverse. The parallel universe provides and opportunity to collect enormous amount of personal data. Metaverse platforms can track individuals in a much more intimate manner. Companies can monitor physiological responses and biometric data such as facial expressions, vocal inflections, and vital signs in real time while participants are in their metaverse and it is still unclear how companies will use such data to tailor advertising campaigns that may influence behaviors of this kinder generation. Since most open Metaverse environments are governed by DAOs, market pundits fee that it is currently safe to assume that no single corporation owns user data.
There is however significant concern use of AI in Metaverse and its ramifications once . In other words, Human Computer Interface (HCI) may still require a bit of rethinking from its current avatar. The underlying technology for haptics today is Electromyography (EMG). The EMG is designed to carry electrical signals from the human nerve center (thoughts and intent) to machine readable inputs. We currently do not fully understand the medical implication of such technologies. The haptic technologies are designed to recreate real life experience of touch, force and motion as a reaction to receiving stimuli from the virtual world. There is still significant amount of game input latency.
The cost of hardware is still quite steep an for fully immersive Metaverse to be mainstream, the cost needs to come down significantly. Companies like Meta, HaptX, Varjo XR, Steam, Playstation (Vive), Teslasuit,
|
Company |
Description |
~ Price |
|
Meta |
Meta Quest 2 VR geadset with Touch controllers |
USD 299 |
|
Varjo |
Varjo Aero headset capable of running SteamVR content including built
in professional 3D software like Gravity Sketch and Key VR |
USD 1990 |
|
Valve |
Steam Deck is a hybrid game console. Valve has collaborated with HTC.
Together they have launched SteamVR platform a virtual reality platform
topped up with HTC Vive VR Headset capable of motion tracking with the help
of motion controllers |
USD 999 |
|
Sony |
Playstation VR requires to be connected with PS5 console to enable PS
VR games. Dualshock wireless controller, PS Move contollers and PS VR aim
controllers need to be purchased separately |
USD 369 |
|
Vive |
Vibe Pro 2 Headset received the 2021 Gamesradar Hardware Awards |
USD 799 |
|
HP |
HB Reverb G2 is an immersive hyper realistic VR developed in
collaboration with Valve and Microsoft.It comes with motion controllers It
won Reddot Award in 2021 |
$569 |
|
Manus |
Manus does not offer a VR head set. At the core is manus Polygon, a
motion capture software that is fully compatible SteamVR. Manus Polygon is a
tracking system that combines Vive Tracking pucks with 5 possible hand
tracking gloves (Prime X, Prime X Marker Mocap, Prime X Haptic VR, OptiTrack
Gloves & Xsens Gloves) in order to provide a bull body VR
experience. The basic Prime X gloves price - |
$4,990 |
|
Teslasuit |
Full body VR gaming suit Teslasuit DK1 has 68 haptics point capable of
simulating physical sensations in the body |
$20K |
Metaverse is big and evolving and has room for everyone
Current engagement in Metaverse is limited to a few activities like creating, buying and selling exclusive NFT collectables like clothes, shoes, beanies etc meant for avatars, buying and selling land and property, hosting events, advertising, buying and selling art through virtual art galleries, NFT smart contracts for Asset and Game Finance, Shopping in virtual malls via immersive commerce etc. There is room to include much more.
Community Building
Social proof is at the center of ecommerce as witnessed in Amazon
reviews and other reviews of products. In the metaverse, brands will be able to
take social proof by building engaging communities that allow customers to
engage with the brand itself and other followers of the brand.
Managing Sustainability
The metaverse, by its very nature, is
not restrained by offline resourcing and ecological constraints. The Metaverse
economy allows for sustainable growth through multiple layers that the
real-world is struggling to meet. Metaverse-based retail can be ‘greener’ than
traditional retail. The materials used to build interactions in the metaverse
should seek to be made from reusable substances or those that can be
incorporated back into the natural world. Advertising might also be more
ecologically sound, as brands can work with influencers to sell digital fashion
without the need to send actual goods. The metaverse also allows brands to
experiment with different product lines before deciding which products to
launch in the offline world. This reduces over-supply risk and waste.
Marketing Opportunities
Creating marketing experiences that tie in with what the brand already
does in real life. In June 2021, Beer brand Stella Artois worked with Zed Run
to create a Tamagotchi-like experience crossed with the Kentucky Derby. They
did this as Stella Artois sponsors sporting events like horse races. Offering
virtual advertising in the metaverse. Bidstack, a video game ad tech co.,
transitioned from real-world outdoor advertising to placing ads on virtual
billboards.The online Metaverse is also merging with the physical world.
Projects like Bored Ape is a good example where digital artwork is brought into
the physical world and sold in the digital world as NFTs. Bored Ape annual
exhibition is ,again, structured under exclusivity. One has to be an owner of a
Bored Ape NFT and be invited by For Metaverse to really deliver it’s intended
value, the cost of hardware needs to reduce significantly.
Telehealth
Covid is here to stay and healthcare institutions can leverage Metaverse
to extend telehealth. After the onset of Covid most of the healthcare professionals
avoid touching their patients directly however it’s a science that to a lot
depends on physical examination - touch and feel. Healthcare institutions can
form a consortium and create their own Metaverse to deliver healthcare services
to citizens. What they would need is advanced haptics technologies available at
both end of the market and at affordable cost. These Metaverses could be a
boiling pot for all healthcare technologies that are gamified to track patient
well being. The intersection of bio medics and computing is making this
possible. Dr. Thanh Do and his team at UNSW has done some path breaking
research in haptic technologies and have developed a haptic device that
recreates the sense of touch using a three way directional stretch device (SSD)
built into the fingertips of a wearable haptic gloves
Travel and Tourism
It’s insane how many Trip Advisor reviews Huxley VR enjoys. Ubisoft
specializes in VR operated live escape games that will transport a player to a
beautifully craft 3D world that offers close to real life experience. These
multiplayer games require a player to solve puzzles and develop skills. Beyond
Medusa’s Gate will literally transport the player to ancient Greece while
Escape The Lost Pyramid VR will give one a realistic tour of ancient Egypt.
EAdeventure Sports
Covid isn’t the fist pandemic or will be the last. The Russia-Ukraine
war has restricted travel to several parts of Europe but such global
catastrophe will not deter adventure sports buffs to live their high adrenaline
lives though Second Life & Eve Online. Eve Online is multiplayer game that
allows you to fight space battles that are intertwined within political
innuendos, betrayals and colossal wars. The player is part of epic stories in
New Eden assuming different roles like pirates or joining warring
alliances or becoming part of massive fleet battles or joining a formidable
space corporation whose job is to wage wars and destroy weaker groups. In the
process the player collects bounties or farm large number of NPCs (Non player
characters)in asteroid belts or cosmic anomalies.
Financial Services
Metaverse allows Decentralized Finance (DeFi) through platforms like
NFTFi. Players can take loans against their NFT as collateral against smart
contracts. A smart contract is a piece of code on the blockchain with specific
rules. The rule will specifically define the terms of the loan and expiry. On
the date of expiry the smart contract will automatically execute and will put
the NFT on sale in case the loan is not repaid. DeFi thus adds another layer of
opportunity and risk to companies working capital and treasury management.
Retailers Could Be One of the Largest Beneficiaries of Metaverse
Retailers should prepare for Metaverse as the shift if inevitable. The following are the low hanging fruits for retailers
- Retailers will need to move beyond the current 2D focus of ecommerce to prepare for a more social & immersive future of shopping. Investing in talent for applications such as AR will be most important for brands in beauty, fashion, and home furnishings. Retailers could use the support of ecosystem partners to integrate or build platforms like Bitski or DressX to create digital fashion by allowing avatars to use the digital try on functionality and try new clothes.
- Retailers should look to developing their own metaverse strategy embracing willingness to experiment, learn, and iterate. Currently most major brands are operating only around trading NFTs. Design Thinking session should help retailers explore other opportunities
- Retailers should use the Metaverse ecosystem for co-creation. Giving users a say in what digital experiences look like poses some risks for brands and retailers, but on platforms like Roblox where independent developers are responsible for almost all of the content—partnerships with established creators can result in more engaging products & experiences that speak to users’ needs.
- There have been several retail innovation over the past few years. Retailers should work with system integrators to pool all these innovations into the Metaverse and developed a consolidated offering that complements the real world value propositions
- There will be talent crunch as Mataverse becomes mainstream. 3D engineers and 3D artists will be in high demand, so brands should consider how to nurture talent in-house and start researching vendors and potential partners. Some of the top 3D artists today are XCopy, Alotta Money, Mike Winkelmann (Beeple), Kevin Abosch, Anna Zhilyaeva, Murat Pak, Fewocious, Hackatao, Trevor Jones, Jeninu, Mad Dog Jones, Micah Johnson, SlimeSunday, Josie Bellini FVCKRender, Dmitri Cherniak, Coldie and Stephy Fung et al selling their digital art and NFTs on NFT platforms like Super Rare. Death Dip broke the SuperRare sales record after being sold for 1000 ETH. Alotta Money’s Voxel Hotel ranks top on CoinDesk’s Most Influential portraits. Beeple’s NFT artwork was sold at Christies for $69.3 million. Kevin Abosch, whi is known as a “conceptual artist” sold a photograph of a potato for about $1.5 million. Murat Pak is known as ““Satoshi of crypto art” was praised by Elon Musk for project Archillect. His “Fungible” collection was sold for $1.4 million at Sotheby’s in April 2021. Victor Langlois aka Fewocious is a transgender artist who earned $2.2 mn from Christies by selling their artworks, tangible paintings and a series of drawings. Stephy Fung is a fashion designer who is taking digital fashion to a whole new level. She creates animated dresses as NFT that are available for anywhere between .5 to 3 ETH (~$9K). NFTs allow designers receive royalty from secondary market sales.
- Retail companies with excess cash can offer loans to their customers through PawnFi or NFTFi. If a customer needs a loan in actual cash, he/she can use the NFTs as collaterals to get a loan to buy new products and services on the Metaverse. A loan automatically initiates a smart contract
It is easy to get carried away by the lure of NFT race and get on a build frenzy. blockchain analytics company Covalent found that fewer than 2,000 buyers accounted for 80% of total purchase volume on Rarible, the second-largest NFT exchange. The other industries likely to face the heat of Metaverse will be Social Media (Tick Tock posts being traded as NFT), Gaming, Fashion (Digital fashion), Marketing & Branding intermediaries (Atari buying land on Sandbox and Decenterland to earn ad revenues), Fashion, Architecture and Entertainment.
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