The stakes when entering the metaverse are high and the pressure is on.
Brands are feeling a sense of urgency and don’t want to get left behind, says Charles Hambro, co-founder and CEO of Geeiq, which helps brands navigate gaming partnerships. At the same time, existing communities in metaverse worlds are vocalising disapproval of brand appearances that don’t pass muster.
It’s a gold rush, adds Doug Scott, co-founder of Subnation, a marketing and advisory firm focusing on gaming culture. “The challenge is, yes there’s infrastructure being built, but you really have to survey the land and understand where your role is for your company and what you’re trying to do, or else everything looks like an NFT.”
Metaverse gaming and NFTs could make up 10 per cent of the luxury goods addressable market by 2030, offering €50 billion in revenue and an estimated 25 per cent lift to the industry’s profit pool, according Morgan Stanley estimates. The challenge for brands is to understand where they fit in the metaverse and how they can differentiate within games, virtual stores, digital fashion, mixed reality and NFTs.
It’s a costly undertaking. Introductory rates for consultations with a luxury brand can start at $150,000; while a full project implementation can reach $1.7 million, not including revenue share or firms that have an indefinite monthly retainer, according to prices shared by several firms. “If a brand is serious about entering the metaverse, they should have a budget set aside for a holistic strategy,” says Cathy Hackl, CEO of metaverse-focused agency the Futures Intelligence Group.
She advises brands vet potential advisors just as they would platform partners. “If you’re launching an NFT with someone who claims to be an NFT expert, ask them what is in their wallet. It doesn’t mean they need a Bored Ape, but they need to be able to show they own NFTs and they understand the mechanics of buying NFTs.”
Here is the top advice from some of the emerging metaverse agencies:
Stick with your DNA and “no malls in the metaverse”
A big mistake is for brands to simply reproduce a virtual something that already exists physically, says Patrizio Miceli, president of Al Dente, a Paris-based communications and creative agency specialising in new media and innovations, which expanded to the metaverse in December. Clients include Chanel, Versace and Louis Vuitton, who trust them to play with the DNA of their brand, Miceli says. “I don’t want a mall in the metaverse — I want to know the DNA of a brand in a more creative, gaming way. Brands are in a moment where they want to know what is their imprint in the metaverse and what is the role of luxury in the metaverse globally? It’s all about creating really a new vocabulary for brands in this world.”