A few weeks ago, I went down to Miami to speak to hundreds of marketing professionals at Adweek’s annual Brandweek summit. They planned a day dedicated to Web3 and the metaverse, the latter of which still seems to confuse many. What follows are the key tenets of the presentation I gave surrounding a single, challenging provocation: The metaverse isn't real.
Before diving into the meaty stuff, first let’s address this statement. Of course, “the metaverse isn’t real” is clearly a play on words. The metaverse exists in digital space, not physical space. It is always changing and, with a few lines of malicious code, can disappear for minutes or days.
Sam Ewen is the head of CoinDesk Studios.
But it also isn’t real in another sense. The hype surrounding the metaverse is betting on a future immersive and experience-rich virtual world infrastructure that does not yet exist.
While it’s great fodder for press releases and investment rounds, the metaverse as it exists today isn’t yet useful for the billions of users we are being told will join it. It is simply too early to tell how it will truly roll out. As we will discuss here, there are many competing factors in play.
One final point to mention before we dive in is that I exclude Roblox, Fortnite and other gaming systems from true metaverse consideration, as most of these platforms are centrally owned and have often resisted the Web3 call. They are certainly more robust and populated than most so-called metaverse platforms, but I believe they are just advanced video games and are antithetical to decentralized open systems. The metaverse I am speaking of is an immersive or augmented alternate reality experience that is primarily built upon a blockchain tech stack.
First off, what are the principles of a Web3 metaverse?
- It is persistent and decentralized. No one entity can turn off the blockchain. Users can log in on their own time and ideally from a platform device of their choice.
- It has a self-sovereign identity/asset layer. Whom we show up as and what we bring in is ours. Data is owned by the user.
- There is community alignment. Participants are free to build, create and connect with each other as well as monetize their efforts and assets.
- Currency is interoperable. Earn/spend mechanics are not a closed loop. Outside assets can be exchanged for in-world economic tokens and earned tokens can be converted back into IRL spendable tokens.
The metaverse is the next step in the evolution of (human) network technology
Just as Moore’s law predicted technological evolution that has enhanced how computers work and connect with each other, we have seen the parallel evolution of how humans do the same. Technological advancement has let us synchronously connect to a wider and more diverse set of people, with the barriers of geography, demographic similarity and differences in our cultural systems falling away.
Matthew Ball recently wrote in Time magazine that we are entering the fourth major era of computing. According to Ball, these eras are:
- Mainframes (1950s-1970s)
- Personal computing (1970s-present)
- Mobile and cloud (mid 2000s - present)
- Metaverse (2020s - ?)
If we believe in this, then we are just beginning our journey. The metaverse that many seem to think is just around the corner is the Spielbergian Ready Player One version. A fully immersive, almost photorealistic fantasy world where you can be a superheroic player, have access to endless information, feel real-time haptic response and benefit from fully functioning economies. While there are notes of this in some current projects, we do not yet have the bandwidth, real-time processing power or home hardware to truly bring this vision to life. Today’s streaming infrastructure allows for connected low-to-mid resolution game dynamics, canned animations, basic messaging and slight geo-location awareness.
The current state of the metaverse
Today there is a tremendous amount of experimentation going on within the metaverse space, with a wide variety of approaches. But, again, we must resist the hype that founders, venture capitalists, brands and others are espousing and be realistic about the state of what is actually possible today while keeping an eye out for what will be tomorrow. Anyone who spent significant time in CyberTown or SecondLife knows how the aspiration of what a virtual world can be does not always match the reality of how it actually is. Yet, if we believe the stats (some are predicting the metaverse market cap to be almost $1 trillion by 2030) and the premise that the metaverse is the next wave of technological innovation, then Web2 brands and Web3 builders need to be prepared to jump in and start strategizing.
As such, I thought it would be beneficial to pen these five takeaways for anyone looking to explore:
1. Prepare to take action and have a flexible approach for the future
Forward-thinking brands are learning, experimenting and generating strategies and approaches for multiple use cases right now, from creating owned and operated worlds to plugging into future community-owned microverses. While many brands are doing the hard work to learn and try, others are releasing projects just for attention and to seem “innovative.” Yet the metaverse isn’t necessarily a fad. Don’t build for a press release, build for a three-to-30 year seismic shift in human connection.
2. Stop focusing on selling and start focusing on feeling
Brands building in Roblox right now are mainly creating gamified commerce experiences. We are imprinting shopping behaviors on people from every angle and to a younger demographic. Is that the best we can do with an immersive, data- and graphic-rich experience? In the same way that Apple stores feel like life upgrade opportunities compared with Best Buy’s transactional focus on product showcase, emotion-based experiential design thinking will lead to brand success in the long run.
3. Community, empathy and connectivity will drive the metaverse more than commerce
Let’s not forget that the most successful modern tech brands in the world built themselves on making it easier for people to connect with each other. From Facebook to TikTok, what lies at the heart of these brands is chat, comments, self-expression and community (sprinkled with some anger and rage). The metaverse allows access to supportive communities across various subgroups based on passion and more importantly, empathy. If we look at the metaverse as immersive social media instead of gaming, we may design experiences with more kinship in mind.
There are endless stories of people who live in small towns or countries where their sexual orientation, musical tastes, fashion style, neurodivergence and other traits get them bullied, shunned or worse. But going into virtual spaces has opened up connections between like-minded people who not only support but celebrate each other’s diversity. It is a tool for people to find their people. It may be hard for brands and corporations to naturally insert themselves here, but the ones who can do so authentically can truly find a loyal community base.
4. Digital identity is fluid and ever changing
Instagram and TikTok reward sameness. From the angry chef who critiques recipe videos to the scores of teens making viral dance videos, neither the algorithms nor the fans like it when creators change their style or trends. But identity in the metaverse is designed around a certain fluidity, the ability to connect a wallet and change from one avatar to another with ease. With many active wallets holding dozens of non-fungible tokens and metaverse projects actively working with PFP collections to import them to in-world playable characters, we should prepare ourselves for a future where we change how we represent ourselves in the metaverse as often as we change our moods.
5. Contextual mixed reality metaverses may outpace purely digital metaverses
The digital twin market is expected to grow from $6.9 billion in 2022 to $73.5 billion by 2027. Just as Google and Apple have mapped the routes and topography of the world, there are many large and small companies that are using lidar and other scanning technologies to capture and collate the 3D information of the world around us. This has the potential to become the next large creative landscape – the overlay of art, data, social connection, search and commerce, applied as an information layer on the actual world around us through the use of mixed reality hardware and software. The biggest explosion of the metaverse, especially in non-gaming activities, may actually be in real-world locative data showing us everything from available tables at local restaurants to artist skins on the bridges, buildings and skyline around us.
In summary, there is a tremendous amount of hype surrounding the metaverse – what it is today and what it has the potential to become. Soon, there could be a seismic shift in how people spend their time in digitally enhanced worlds that could enable a whole new paradigm of borderless connection. With an eye to the future instead of rushing into today’s hype cycle, taking a long-term metaverse approach will pay off in the end.