Visit any Indian market and one will never fail to encounter the sight of brands hard-selling their products to consumers. Consider New Delhi’s bustling commercial centre Connaught Place for instance that is dotted by a spate of retail stores—one will often find store executives deftly marketing the brand discounts in store for users as they make frantic attempts to get more footfalls. This experience may soon be replicated in the virtual world. As the clamour for Web3 grows, giving shape to the concept of metaverse which essentially envisages enablement of social interactions and economic transactions within a virtual space by tapping into immersive technology, local brands are gearing up to make foray into the metaverse. The idea is to reach where the consumers are or go ‘direct to avatar’ as coined by some analysts. Within the metaverse, people interact by way of their digital avatars. “As the importance of virtual selves grows, selling to users’ digital identities—in other words, going direct-to-avatar presents huge branding and monetisation opportunities for fashion brands and retailers more broadly. In 2022, we expect the direct-to -avatar business model to take off as brands bet on the future of virtual worlds and compete for relevancy online,” analysts at CB Insights said in a note. They project the model will gain wider acceptance and will be adopted by players across spectrums including restaurant chains and professional sports teams. After all, the market opportunity for virtual goods is pegged at some $190 billion.
Homegrown D2C headphone brand Leaf Studios which claims to have a million customers is planning to make a launch on metaverse. The company is working on making a metaverse compatible headphone—this will be fashioned in the form of an NFT (non-fungible token). When consumers make physical purchases of the brand’s headphones, the firm will drop the NFT in their metamask wallets. “These NFTs will let them unlock the same headphone that they bought from us in metaverse as well,” co-founder Paras Batra tells Fortune India. Those users who are currently devoid of metamask wallets will be guided by the company on the procedure to create one. At present, the firm is creating a Decentraland compatible headphone and will gradually extend the usage to The Sandbox as well. Simply put, Decentraland and The Sandbox are blockchain-based virtual worlds and two of the most significant players who are trying to build an open metaverse. “When users connect the wallet with Decentraland, they can use it (the NFT which will unlock the headphone). Metaverse platforms Sandbox and Decentraland are open, one just needs to comply with the design guidelines,” says Batra. The brand’s metaverse launch is slated to happen later this year. “Right now on Decentraland, people can wear multiple wearables including headphones. Our thought was can we also enable our users to wear the same headphone they are wearing in the real world on metaverse also,” says Batra. If the strategy works, the brand might consider opening a store on metaverse. “Of the million customers, today very few of them have used any metaverse platform like decentraland but it will gain more and more traction with time. To start, we just want to unlock this option for them" says Batra.
D2C brand Rage Coffee plans to set up a store on the metaverse in the near future. The company will zero in on a platform like The Sandbox or Decentraland and eventually launch a retail store by buying a virtual plot of land to realise its metaverse ambitions. Although that process of establishing virtual shops is certainly not cheap and entails costs, the opportunity is considerable given that the metaverse economy is largely being driven by GenZ. “These digitally native generations are growing up immersed in online experience, gaming, school, classes, dating and lifestyle, and are spending money on virtual goods and services within these environments,” says Bharat Sethi, founder at Rage Coffee. The metaverse has grown out of the gaming experience and has the potential to be a leading entertainment format going ahead. “With time, enhancement of technology and increased accessibility of the technology, more and more aspects of daily lifestyle will be explored in the metaverse,” predicts Sethi.
In a virtual environment, brands also have more leeway to customise and test products than in the real world, especially as physical constraints like supply chains, inventory, labour, material costs and other related factors become non-issues, point out analysts at CB Insights. Reportedly, Goldman Sachs’ Eric Sheridan recently called the metaverse a “$8 trillion market opportunity” which is understood to be about the size of the GDPs of Germany and Japan combined.
The local market is also seeing the emergence of a clutch of enablers which should make it easy for brands to capitalise on Web3. Take Mumbai-based Optiminastic Media for instance which is helping brands to build their stores, office spaces and to conduct events on the metaverse. The firm which will officially announce its services in April is positioning itself as a MAAS or metaverse-as a-service platform. Founder Akshae Golekar says that the company is in talks with three consumer brands without elaborating. “Going ahead, a lot of events will happen on metaverse,” says Golekar.
SaaS platform Kappa is building ‘video metaverse’ for brands. Essentially, the firm lets brands craft immersive experiences using videos. It allows the users to participate in the story. “Instead of just watching the video, audiences are now playing in the video. The video-metaverse is not the future, it is already here. For brands, this is the transition point to build engaging customer experiences-faster, to build their own utopia,” says founder Prashanto Das. Besides, the company also aims to make metaverse-tech accessible to professionals. “To empower teams inside organisations, we have built a no code collaboration platform where teams can craft immersive experiences together,” adds founder Shubham Chauhan.
While the buzz around metaverse is growing across markets, it is not without challenges, at least in India where currently a very minuscule proportion of the population has access to AR and VR devices. The metaverse is powered by AR and VR techniques. For that matter, platforms using AR and VR capabilities are also quite low in the country, points out Chauhan. “In the next three to four years, we should have capabilities to create AR/VR experiences,” says Chauhan.