The RetailX Metaverse Almanac 2023 report, available to read online now, looks at which retailers are investing in the metaverse and how are they making those tentative first steps.
It highlights that retail is one of the first non-gaming sectors to see the potential of the metaverse. While the sector has always been quick to embrace internet technologies, the metaverse potentially adds a whole new dimension to what has gone before for brands. The internet has taken a large slice of retail activity, but it is flat. Retailers have been quick to see that, ultimately, the metaverse can create an immersive, 3D simulacrum of real-world shopping online.
The first steps in this have been to appear on the platforms that currently make up the metaverse – Roblox, The Sandbox, Decentraland et al – offering game-like experiences, NFT-backed virtual versions of the goods retailers sell, putative virtual stores and some live events.
While not quite the fully immersive, 3D shopping experience that it could deliver, these first steps are the vanguard of the sector finding its way into the metaverse, showing the early crop of metaverse users the potential of what they can do and creating a presence, a flag in the virtual ground, declaring that they are here.
More prosaically, they are also using it for simple marketing and advertising.
The fashion segment leads the way, with an impressive 34% having some sort of participation in the metaverse already. This is way ahead of the next segment, consumer electronics, which has a still significant 17%.
Other sectors, including homewares and sports and leisure apparel and equipment have seen 7% participation so far, indicating that there is a nascent interest in exploring what the metaverse has to offer.
Metaverse retail ‘events’?
Retailers are using the metaverse in a variety of ways, most categorised as ‘events’. This term cover a range of activities from pop-up shops, the rollout of NFTs in games and other’s pop-up shops, virtual events where consumer avatars within the platform where it is taking place can attend, through to simply putting a retailer’s name up on a virtual billboard within an existing game.
The variety of campaigns and events makes it hard to view any of it as a trend per se, rather it is indicative of retailers and brands trying a wide range of tactics to sound out what they may – or may not – get out of being seen in the metaverse.
For the majority, 2022 has been ‘year zero’ for their metaverse activities, with 62% of those that have launched an ‘event’ in the metaverse doing so this year, compared to just 14% in 2021 and only 3% that have been in the metaverse for three or more years. 21% have an ongoing presence.
Of these retailers and brands that have been operating in the metaverse, 34% have offered up one event, so far, 38% two and 28% three or more. Of these, most offerings are temporary, with a quarter (24%) lasting less than a week, most (41%) lasting between a week and a month, while 29% last between a month and a year. Just 6% have any degree of permanency, lasting more than a year.
Together, this is indicative of many brands feeling their way into this new realm, trying out a single offering and seeing who bites. However, the fact that nearly two thirds have tried two or more events within the past three years offers insight into how, for these brands, there is some kind of return, tangible or otherwise.
Tangibly, retailers and brands must be seeing either increased sales of virtual goods, increased sales of real-world goods off the back of their presence or getting some reward from being on these metaverse platforms today. Less tangibly, it is highly likely that the social media kudos, marketing awareness and halo effect on brand from being seen in these virtual worlds is generating enough heat to warrant their continued presence and multiple offerings.
This builds on the idea that many forward-thinking brands and retailers are increasingly convinced that the metaverse will offer them something important in the months and years ahead and that gaining a presence there now will give them some sort of first-mover advantage.
Where in the metaverse are retailers to be found?
Of those retailers and brands that are making these steps into the metaverse, the bulk are using Decentraland and Roblox. These are the two most prominent metaverse platforms and so their 21% share each is perhaps unsurprising. While the rest are dispersed across a long tail of increasingly niche sites, games platforms and dark web properties, what is surprising is that Facebook’s Meta does not appear on the list.
This is potentially down to two factors. Firstly, Meta is currently seen as a work in progress, yet to prove its concept and so is not really open for business as far as many brands and users are concerned. Where Roblox is already established as a gaming platforms with millions of users and The Sandbox and Decentraland are attracting a growing niche of users, Meta is trying to create its presence from scratch from Facebook’s enormous, but less tech-savvy, audience. While it has access to literally billions of people, most are not yet even aware of the metaverse, unlike Roblox’s Gen Alpha key demographic.
Secondly, Meta is also perceived outside the consumer space as a hardware play currently, offering headsets and building a platform to run the metaverse on.
Together, these factors see retailers and brands yet to investigate what Meta has to offer. That doesn’t mean, however, that it won’t be a force to be reckoned with down the line. The company is playing the long game and could, through its deep pockets and enormous consumer reach, yet become the basis of the next stage of the metaverse.
This analysis, and more, can be found here. Access the full report to discover:
- What consumers in the UK and US make of the metaverse
- How long consumers spend in the metaverse
- Are a small number of companies – Amazon, Facebook and Google – likely to dominating the metaverse as it gains mass-market appeal?
