Recently there has been a lot of noise about Web3 and the Metaverse. As gaming currently is providing some of the most meaningful examples of the Metaverse as user experiences we have asked members of our IAB Australia Gaming Working Group to reply to the question – ‘What is the Metaverse and what should marketers be considering in terms of any current and future advertising opportunities?’
We have also written a brief explainer on Web3 to help provide some additional context on some of the key themes that help to underpin the Metaverse and make it plausible. Click here to read this
Simon Slee, Business Development Director – Double Jump Communications
With the word ‘metaverse’ being used as a blanket term for everything new in digital these days it’s no surprise that the definition is a big source of confusion. At its simplest, a metaverse is a computer-generated virtual environment or ‘digital world’ where people can connect and engage socially. It is also not one entity, and in reality, there are many metaverses that for the most part exist and operate completely independent of each other.
It’s also important to declutter the term from all the surrounding tech that has come to be associated with it – Web3.0, NFTs, Blockchain – none of these are actually mutually exclusive to the metaverse at all, they are simply new technologies that can enhance a metaverse (and help connect between metaverses for better interoperability) but you can operate with these technologies completely independent of a metaverse all together. Assess them on their own, they all need investigation too.
With that in mind, the metaverse is already here. There is no grand moment where it arrives, it’s an ongoing process of growth, improved quality, new features, and scalability that has been pioneered by the games industry for a few decades now. We are just reaching the point where audiences are spending so much time in these digital worlds that they can’t be ignored, and the tech tools are good enough for brands and advertisers to engage.
The first step should be to define what your brand’s digital representation and value looks like. Get your products created digitally, and there are some standards emerging already that allow your digital assets once created to be re-used in multiple metaverses.
Next step is to consider the environment. With the explosion of metaverses they all have their own communities and nuances. Creating games and digital worlds is hard, it is not ‘build it and they will come’ (there are plenty of empty metaverses to prove this) and we will see many more metaverses arrive and fail so assess every environment like you would any other advertising opportunity for audience fit and reach.
Finally, decide what type of engagement is right for you. Do you want a conversative approach that is essentially ‘digital branding’ (i.e. sponsorships, billboards, etc.) where you can test and learn across many metaverses, or are you ready to go all in on a ‘digital experiential activation’ where you build a brand experience in a focused metaverse…keeping in mind that creating an engaging digital experience is not easy (or every game would be a hit) and you may have to invest as much in raising awareness for it as developing it to achieve success. Also be mindful that metaverses generally have no geographic boundaries so these activations are generally more suited to global brands who can share the costs and success.
In summary, treat your approach to the metaverse(s) like any other advertising opportunity, be ready with your digital assets, assess each environment based on its audience suitability and reach, complexity and nuance of opportunities will grow over time…but don’t wait, jump in!
Zoe Cocker, Head of Innovation & Yahoo Creative Studios
Imagine trying to define the internet in the 70s. Innovators were hyped about the creation of an entirely new form of communication but no one could provide one singular definition of what this new reality would look like. The same can be said for the metaverse.
The metaverse doesn’t have a standard definition because it’s still a construct, it’s not final yet. That being said, there are some fundamental principles that many can agree on:
- It’s immersive. Your current web experience most likely exists in a browser within a 2D laptop screen or smartphone screen. The metaverse will be a 3D digital space, an all-encompassing immersive experience where you can roam about freely.
- Built on blockchain – one of the most distinguishing differences between web2.0 and web 3.0 is the fact it’s built on blockchain. It’s an entirely new economy and potential new revenue stream. In the metaverse you can assign value to a digital object. For example a designer garment can exist in the ‘real world’ and be sold for an agreed value. Currently in Web 2.0 the only value a digital version of that garment has is its re-share or like count.
- It’s interoperable, the benefit of a decentralised platform like blockchain means there’s no sole owner. Your digital avatar or object can transverse worlds, environments freely without restriction.
- It’s powered by multiple technologies. Web 1.0 was enabled by dial-up modems and desktop computers, Web 2.0 was enabled by 4G and smartphones, Web3 will be powered by VR/AR/MR, game engines, 5G and technologies we haven’t even conceived yet.
The metaverse is still in construction so the opportunities are endless and only limited by imagination. As new consumer experiences are built from scratch, designing new branded opportunities will follow suit. For advertisers that are keen to act now, there are plenty of options available to ensure you’re making your mark. But it’s important to lean on the experts who are building for this world, to get your best foot in the door.
Defining your intention is the first important step. Brands have the chance to own a niche category in this new space. For example, if you work for a makeup company, you’re fighting competitors in an extremely cluttered environment. But in the metaverse, early players could take ownership of the category and build entirely new communities way ahead of bigger players.
For other brands, the metaverse is a chance to completely reinvent themselves or attract entirely new audiences.
So how do you act on these opportunities? It depends on your level of investment and involvement.
As a starting point all brands should be thinking about how their brand looks in a 3D space. From creating products in 3D, augmented reality experiences or 3D assets such as wearables and avatars. Yahoo has already helped plenty of brands, including the likes of BIG W, Officeworks and Optus start here.
At a more integrated level, companies can engage with new communities by creating digital assets that they can trade, wear or consume. Think NFTs and digital garments. At the highest end of the spectrum, brands can jump in with both feet and create their own virtual worlds to curate a whole new brand position and audience. With Facebook changing its name to Meta, and Nike filing several trademarks to make and sell virtual Nike-branded sneakers and apparel, the big players are already taking this seriously. It’s the direction our ad industry is heading, whether we like it or not.
To view a recent Marketech APAC video on Marketing in the Metaverse, that goes into a lot more detail, simply click here
Georgia Woodburne, Managing Director JAPAC – Azerion
The Metaverse is a place where people can connect and enjoy digital entertainment as virtual characters with their own immersive identity. The emergence of Web3 means brands and consumers can interact with each other on new terms.
Our experience in already launching three metaverses shows that marketers can integrate their brand proposition by providing entertainment and utility, such as shopping, and by making their brand authentic and relatable to the people taking part in the experience.
For more from Azerion on this topic simply click here
Matthew McGinley, Head of Publisher & Telco Development – InMobi
What are the rules of the Metaverse? The anatomy? Who are some early key players? How do brands and advertising fit in all this? And lastly, where does this leave mobile? In our recently published eBook we discovered there are 7 components of the Metaverse and 6 things you can do today.
The goal of the Metaverse is to generate experiences and establish a new system of ownership and financial system. This is where Web3 comes in, with one example achieved via NFTs (non-fungible tokens) that can serve as products or services and can be bought and sold with cryptocurrency via the blockchain (Web3’s Infrastructure).
Alongside this, Gaming is seen to be a conduit for online immersion and interactivity – elements that are key building blocks of the Metaverse. Enabling the creation of digital avatars to express oneself, participating in augmented reality (AR) or virtual reality (VR) simulations, purchasing these NFTs and accessing borderless, online social gatherings are all part and parcel of being a gamer. Thus, the essence of gaming itself aligns greatly with what the Metaverse envisions – a world-building functionality within an online capacity.
With Mobile blended in-game advertising, brands and marketers can programmatically insert their ads anywhere within the gaming environment – from billboards along with virtual cityscapes, or even enabling users to design their avatars with advertised brand apparel. Blended in-game advertising is most likely the closest we are to experiencing advertising in the Metaverse today and can serve as early inroads for brands to explore.
Yun Yip, General Manager – Foxcatcher
Web 3 and metaverse are two hot buzzwords of the last 12 months. In most initial discussions we have had in the market, the terms have been used interchangeably largely because these two concepts are still evolving and overlap in many ways.
Before we define web 3, let us briefly look at the evolution of the internet that has paved the journey. Web 1 started the World Wide Web – it connected data and information (e.g., Emails and instant messaging). Web 2 can be characterised by the user-generated web and its intent on connecting people. Social media and networks like Facebook are a big part of this phase. Finally, we have Web 3, connecting people and destinations (real and digital). Web 3 is still an evolution and primarily characterized by a decentralised and democratised internet – where users control and own their digital content, assets, and identities. An essential foundation of Web 3 is also the technologies that underpin it – e.g., Blockchain, Blockchain-based cryptocurrencies, NFTs, VR, and AR. These technologies also best illustrate how the relationship between web 3 and metaverse are so closely linked. Read on.
The metaverse is an ongoing development of the digital and virtual worlds. One way of thinking about the metaverse is that it is an approach to interacting and living in the virtual world. Platforms like Fortnite not only allow for an immersive gaming experience, but artists also such as Ariana Grande have taken to the platform for its virtual concert stage. Roblox was once considered a gaming platform in the metaverse. It has increasingly helped businesses build their brand with a new generation/audience while encouraging shared experiences between their brand, users and communities. The advancement in VR and AR technologies have helped drive the quality of each user’s experience. If we are to think about art as an example, NFTs have also allowed for a song or piece of artwork to be can be kept on the blockchain as a one-of-a-kind collectable item. It cannot be faked, stolen or copied – a big problem which has existed for a long time.
Fashion houses such as Ralph Lauren and Gucci leveraged Roblox to connect with a new generation of users. The outcomes from both an engagement and sale perspective have been so positive that brands are extending these virtual and exclusive events. The Gucci Garden experience, as an example, sold a digital Gucci bag for more than its physical form. To keep it real, a friend’s kid spent more on their avatar outfits than they do in real life!
If you’re now scratching your head thinking, how do I start? As with all things, it starts with education. Start by understanding who and where your audience is. You can often lay the foundation for a successful entry with your current customer base. Seek to understand the message and presence best for your customers. Jump onto Discord and be part of a couple of communities you’d be keen to mimic, build, and observe the interactions and conversations.
It doesn’t have to be intimidating and/or involve setting up a footprint on Decentraland or Roblox. Foxcatcher’s Worldview can already connect and optimise your current digital campaigns to real-time sentiment for critical moments, events, and words related to the metaverse and web 3. It is also worth mentioning that the metaverse is not a case of ripping up current marketing strategies. Instead, it is an extension and channel to amplify media and marketing activities.
The outlook and possibilities for brands in the metaverse is exciting, and the great thing is that if you jump on now, plenty of like-minded brands and marketers will be on board to collaborate and create a new way of advertising with you.
Poppy Hill, Sr. Group Director of Integrated Solutions- DoubleVerify
The emergence of the metaverse and Web3 is poised to revolutionise what happens inside the game and a player’s assets and time during gameplay. Similar to the physical world, the metaverse is a virtual society; for it to function like real life it needs to be interconnected. An example is creating custom virtual experiences within game environments where goods and services can be exchanged. A key challenge for the metaverse is to overcome interoperability – it can’t be a series of individual walled gardens. Licensing rights, and how creators get paid in an interoperable environment needs to be solved. Initiatives such as the Open Metaverse Alliance for Web3 (OMA3) are focused on creating standardisation for the metaverse to help overcome challenges for the industry to grow.
Web3 is made up of a combination of decentralised networks and blockchains, allowing people to own property rights in the form of nonfungible tokens (NFTs). There has been a significant amount of mergers and acquisitions in Web3 companies, notably the venture capitalist firm A16Z multibillion cryptocurrency fund focused on investment into crypto and Web3 start ups such as blockchain games. For example, play-to-earn economies allow players to participate in the form of gaming communities, rewarding them for the time they have spent within the game and enabling ownership of assets that can be traded, similar to the physical world. According to a recent Newzoo survey, 40% of gamers across the U.S., U.K., and Indonesia are interested in blockchain games, however knowledge around blockchain and NFT’s is a barrier for wider player adoption.
Marketers considering Web3 game environments will need to invest money and resources into developing their gaming infrastructure. This includes developing innovative and creative strategies that blend seamlessly into the game environment to create ad placements that retain audience motivation and minimise interruption to gameplay flow.
Whilst it’s early days for metaverse and Web3 ad opportunities, developing measurement and verification standards while solving challenges that overcome interoperability will enable marketers to invest in new gaming mediums with confidence.