How should brands approach marketing in the Metaverse?
Updated: Oct 7, 2022
Before we talk about how companies should think about brand building and marketing in the Metaverse, let’s start by clarifying what they shouldn't do, as Faith Popcorn puts it: "don't take what you are doing in IRL and dump it in the metaverse".
In the early days of the internet many companies turned their brochures into websites and by doing this failed to imagine the new ways this medium could be used to drive engagement, enhance service and empower customers. Similarly, brands that stand out in the metaverse will incorporate the unique opportunities that AR and VR offer to facilitate deeper connection, build community and drive loyalty, and think beyond short-term sales.
Here are five things marketers should consider before diving NFT-first into the metaverse:
1. Follow your Audience. Less than 18% of people own a VR headset. Only 14% adults say they are familiar with the metaverse and more than 70% still have no clue what a NFT is. Not surprisingly Gen Z and Millennials are more likely to have played online games and visited the metaverse. Point being that if your customer is a Boomer or Gen X you don’t need to dive in headset-first. You can spend time watching their behaviours and let your customers guide your speed and mode of entry.
2. Don’t follow your Competitors. Just because a competitor does something is never a good reason to do it. This is even truer in the metaverse. Many brands still use NFTs as marketing gimmicks to drive acquisition, and don’t think beyond the shiny object. Anyone can create an NFT art collection, build extensions of physical goods or a open virtual storefront. Just doing this is akin to building the brochure website in the early days of the internet.
Brands that standout and are seen as authentic will think long-term about how to use NFT drops to build community, connection and deepen customer relationships. Also, they will take into consideration Web3’s ethos of decentralisation and connect it with their brand values and identity. Not saying this is easy, but the payoff will be far greater in the long run, versus simply doing the easy thing now.
3. Enhance Programs & Channels.
Think about where you can add value for your customers in ways that current technologies don’t allow. For example, nearly 80% of customers have switched brands due to “poor customer service experiences” according to Qualtrics. Consider how you might reduce friction in after sales service (e.g. product set-up) or resolve customer complaints (e.g. live-chat) in real-time. Think about how you can turn negative customer interactions into positive brand experiences. Or rather than re-inventing your loyalty program in the metaverse, think about how you might supplement your physical one to attract new customers; e.g. give away physical products tied to a digital NFT, etc.
4. Think beyond Sales. Think about engagement and brand-building mechanisms that deepen loyalty and give customers a real voice. Consider creating a global customer round table in the metaverse. One that is part focus group, part test lab and part Vox Pop. Such an effort would need to authentic and not simply pay lip service, or it will backfire.
Another might be looking at philanthropic and ESG initiatives through a metaverse lens. Both are viewed by Gen Z and Millennials as lacking in authenticity and trasparency, but factor heavily in their purchase-decisions. How might you use the blockchain to pilot new ways to ensure your ESG commitment and outcomes are measurable and transparent?
Another area ripe for innovation is personal data. 80% of consumers believe they should have complete control over how companies use their data and 86% feel a growing concern about data privacy. Create a new value equation where your brand offers incentives for sharing personal data, rather than vacuuming it up as part of a sales transaction.
5. Mind the Gap. For now, think of the Metaverse as the Wild West because the laws governing it fall into a grey area. For example, what happens when someone touches you inappropriately when you are wearing a haptic suit? This would be considered assault in the real world but currently there is no legal recourse in the virtual one. There have been numerous cases of sexual harassment, racism, bullying and other threatening behaviors reported across metaverse platforms. Further, we know there is a mental health crisis among teens which was exacerbated during the pandemic, due to increased screen time. Brands would do well to strive to find a healthy balance as they build more immersive experiences, stay vigilant and take extra precautions when it comes to targeting children.
Finally, you would do well to remember that we live in an age or “overhype”. Every few minutes there is a new shiny object, bold prediction or ground breaking trend that gets ballyhooed by a small but vocal minority on social media, and then broadcasted by mainstream media. Soon people start to believe it is the new reality. Remember, Second Life, Google Glass, the Great Resignation and predictions about Bitcoin prices always rising, or brick and mortar stores going away because the pandemic changed shopping behavior, forever?
I am not suggesting that the metaverse, blockchain and NFTs are fads that are going to disappear but consider that despite all the hoopla and noise, even today, only 2% of Americans own an NFT.
Also, Web3, unlike Web1 and Web2, will take longer to materialize because of cost of entry, infrastructure complexity and missing standards (e.g. interoperability), lack of regulation and a divergent underlying philosophy. So, go forth and be curious, experiment, pilot new ideas but don’t bet the farm on the metaverse, just yet.
Our final installment: "Interesting Brand Activation's in the Metaverse?" (available 6th Oct)