What is the metaverse?
Put simply, the next version or phase of the internet.
Put simply, the next version or phase of the internet.
What is the metaverse?
As the metaverse picks up traction, there are many who are yet to receive an explanation. Here is the best definition I've found:
"Put simply, the metaverse includes any digital experience on the internet that is persistent, immersive, three-dimensional (3D), and virtual, as in, not happening in the physical world." - Janet Balis, Harvard Business Review. With that definition, let's explain its importance and why it's worth your time.
To understand the value proposition consider the metaverse as the next iteration of the website. With websites, companies or brands can have their own website and/or a profile on a social network website. Similarly, every company or brand can have their own metaverse, or they can build inside another company's metaverse.
The metaverse is different than a traditional website as it's a 3D virtual world. The value for marketers is bringing in-person like interactions and personalized service, now scalable and at the convenience of the user at any time of the day. This combines in-person and online commerce. The psychological benefits of in-person interaction and relationship building combined with the convenience of shopping online and Amazon's two day shipping.
// Retail companies engage in the metaverse for a couple of reasons (1) appeal to a younger or more tech focused crowd (2) capture attention - the most valuable resource of any brand today (3) sell high margin digital assets. There are advantages to being early to a new cultural communication platform, as the early content creators on YouTube and Instagram discovered. There are few that could have predicted the magnitude influencer marketing has today while in the early days of the internet.
// Conversely, a company may not participate in the metaverse because (1) it's still fringe/early (2) learning curve (3) it's not a fit with their current audience. In short, the perceived ROI isn't there. Potential ways to participate will be discussed further down in the article.
As brands and marketers found out in the 2010s, it's valuable to be where people are hanging out online such as Facebook and Instagram. It's hard to think of a sector that hasn't adopted social media. The metaverse will be more engaging than current platforms with more immersive content. The virtual reality headsets close users off from real world distractions, leaving your consumers more focused and immersed in your content than ever. In short, participate because there may be tremendous upside. Keep reading to learn how the world's leading brands have already been participating in the metaverse.
"Put simply, the metaverse includes any digital experience on the internet that is persistent, immersive, three-dimensional (3D), and virtual, as in, not happening in the physical world." - Janet Balis, Harvard Business Review. With that definition, let's explain its importance and why it's worth your time.
To understand the value proposition consider the metaverse as the next iteration of the website. With websites, companies or brands can have their own website and/or a profile on a social network website. Similarly, every company or brand can have their own metaverse, or they can build inside another company's metaverse.
The metaverse is different than a traditional website as it's a 3D virtual world. The value for marketers is bringing in-person like interactions and personalized service, now scalable and at the convenience of the user at any time of the day. This combines in-person and online commerce. The psychological benefits of in-person interaction and relationship building combined with the convenience of shopping online and Amazon's two day shipping.
// Retail companies engage in the metaverse for a couple of reasons (1) appeal to a younger or more tech focused crowd (2) capture attention - the most valuable resource of any brand today (3) sell high margin digital assets. There are advantages to being early to a new cultural communication platform, as the early content creators on YouTube and Instagram discovered. There are few that could have predicted the magnitude influencer marketing has today while in the early days of the internet.
// Conversely, a company may not participate in the metaverse because (1) it's still fringe/early (2) learning curve (3) it's not a fit with their current audience. In short, the perceived ROI isn't there. Potential ways to participate will be discussed further down in the article.
As brands and marketers found out in the 2010s, it's valuable to be where people are hanging out online such as Facebook and Instagram. It's hard to think of a sector that hasn't adopted social media. The metaverse will be more engaging than current platforms with more immersive content. The virtual reality headsets close users off from real world distractions, leaving your consumers more focused and immersed in your content than ever. In short, participate because there may be tremendous upside. Keep reading to learn how the world's leading brands have already been participating in the metaverse.
How do brands interact with people in the metaverse?
Please note, augmented reality (AR) and virtual reality (VR) are considered part of the metaverse as they are an entry point into the virtual world. The discussion will include three companies building the infrastructure/tools/access points for the metaverse and two retail companies. First, the infrastructure.
Facebook:
Perhaps one of the earliest mainstream companies involved in the metaverse. Facebook (now Meta) purchased Oculus, a virtual reality (VR) headset company, in 2014. Since then, Facebook recently changed their name to "Meta", short for metaverse. Meta released a virtual world on December 9th, 2021 with the end goal of a social network/real-world feeling social interaction network in the metaverse. The metaverse finds another use case in virtual meetings, called Horizon Workrooms (pictured above). Teams get the sensation they are working in the same room when working remote. The virtual meeting room can include virtual objects the team can interact with such as whiteboards and presentations. The real value will be unlocked when engineering teams can see and manipulate virtual versions or simulations of physical products in meetings.
Additionally, Facebook released Ray Ban Stories, which are smart glasses with dual-cameras and built-in speakers in the frames of the glasses. In October 2021, Meta announced a $10B spending commitment towards the metaverse in the next year. In 2023, Meta is scheduled to launch their next version of the Oculus Quest 2, their all-in-one VR headset. Known as "Project Cambria" the form factor has been leaked online showing a new design, cameras on the controllers, and more. CEO Mark Zuckerberg described Project Cambria as "a completely new advanced and high-end product" and will be "at the higher end of the price spectrum." Stay tuned for Facebook Connect in October of 2022 and a potential 2023 release date.
Microsoft:
Microsoft has also developed and shipped a VR headset, but in 2016. Most recently in 2021, Microsoft announced plans to bring Teams to the metaverse by allowing people to hold meetings in a virtual reality environment.
Apple:
In 2017, Apple released AR Kit, an augmented reality (AR) development platform for iOS devices. In March of 2020, Apple released its first product with a LiDAR scanner on the iPad Pro with the goal of being the "world's best device for augmented reality." Apple is rumored to be working on a VR headset that many suspect will bring the metaverse and non-fungible tokens (NFTs) mainstream. The device's rumored release date is 2023.
*With an understanding of the infrastructure, let's take a dive into how retail companies are participating:
Nike:
In 2021, Nike purchased digital sneaker-maker RTFKT. RTFKT was created to meet the demand of potential sneaker enthusiasts, but in the virtual world. Sneaker culture is more than just wearing shoes, it's a chance to own an exclusive asset. In the physical world, sneaker enthusiasts purchase hyped sneakers they can later resell for significant sums of money. Examples include Nike Air Jordans, any Kanye West designed sneaker and many others. RTFKT releases virtual sneakers for this same market.
The conversation of a retail company releasing retail products in a virtual world brings us to another key component of the metaverse: non-fungible tokens or NFTs. NFTs are one-of-one or one of a collection to either enforce authenticity or invent scarcity of a digital product. A primary use for NFTs in the 2021 NFT bull market has been art such as the Bored Ape Yacht Club and CryptoPunks, both of which have collection pieces selling for millions of dollars.
Adidas:
In 2021, Adidas acquired a Bored Ape Yacht Club non-fungible token (NFT). This specific NFT is a digital art collectable and a status symbol due to its high price/resulting exclusivity. Adidas is using their Bored Ape in marketing campaigns, and is a mascot of sorts for their brand. Since the acquisition of a Bored Ape, Adidas launched a both clothing and digital trading card-like products including different virtual characters wearing adidas Orginals clothing based on the same metaverse theme.
In short, tech companies are trying to once again build the infrastructure and retail companies are trying to align themselves with the culture.
Facebook:
Perhaps one of the earliest mainstream companies involved in the metaverse. Facebook (now Meta) purchased Oculus, a virtual reality (VR) headset company, in 2014. Since then, Facebook recently changed their name to "Meta", short for metaverse. Meta released a virtual world on December 9th, 2021 with the end goal of a social network/real-world feeling social interaction network in the metaverse. The metaverse finds another use case in virtual meetings, called Horizon Workrooms (pictured above). Teams get the sensation they are working in the same room when working remote. The virtual meeting room can include virtual objects the team can interact with such as whiteboards and presentations. The real value will be unlocked when engineering teams can see and manipulate virtual versions or simulations of physical products in meetings.
Additionally, Facebook released Ray Ban Stories, which are smart glasses with dual-cameras and built-in speakers in the frames of the glasses. In October 2021, Meta announced a $10B spending commitment towards the metaverse in the next year. In 2023, Meta is scheduled to launch their next version of the Oculus Quest 2, their all-in-one VR headset. Known as "Project Cambria" the form factor has been leaked online showing a new design, cameras on the controllers, and more. CEO Mark Zuckerberg described Project Cambria as "a completely new advanced and high-end product" and will be "at the higher end of the price spectrum." Stay tuned for Facebook Connect in October of 2022 and a potential 2023 release date.
Microsoft:
Microsoft has also developed and shipped a VR headset, but in 2016. Most recently in 2021, Microsoft announced plans to bring Teams to the metaverse by allowing people to hold meetings in a virtual reality environment.
Apple:
In 2017, Apple released AR Kit, an augmented reality (AR) development platform for iOS devices. In March of 2020, Apple released its first product with a LiDAR scanner on the iPad Pro with the goal of being the "world's best device for augmented reality." Apple is rumored to be working on a VR headset that many suspect will bring the metaverse and non-fungible tokens (NFTs) mainstream. The device's rumored release date is 2023.
*With an understanding of the infrastructure, let's take a dive into how retail companies are participating:
Nike:
In 2021, Nike purchased digital sneaker-maker RTFKT. RTFKT was created to meet the demand of potential sneaker enthusiasts, but in the virtual world. Sneaker culture is more than just wearing shoes, it's a chance to own an exclusive asset. In the physical world, sneaker enthusiasts purchase hyped sneakers they can later resell for significant sums of money. Examples include Nike Air Jordans, any Kanye West designed sneaker and many others. RTFKT releases virtual sneakers for this same market.
The conversation of a retail company releasing retail products in a virtual world brings us to another key component of the metaverse: non-fungible tokens or NFTs. NFTs are one-of-one or one of a collection to either enforce authenticity or invent scarcity of a digital product. A primary use for NFTs in the 2021 NFT bull market has been art such as the Bored Ape Yacht Club and CryptoPunks, both of which have collection pieces selling for millions of dollars.
Adidas:
In 2021, Adidas acquired a Bored Ape Yacht Club non-fungible token (NFT). This specific NFT is a digital art collectable and a status symbol due to its high price/resulting exclusivity. Adidas is using their Bored Ape in marketing campaigns, and is a mascot of sorts for their brand. Since the acquisition of a Bored Ape, Adidas launched a both clothing and digital trading card-like products including different virtual characters wearing adidas Orginals clothing based on the same metaverse theme.
In short, tech companies are trying to once again build the infrastructure and retail companies are trying to align themselves with the culture.
Metaverse: is it a fad or an innovation?
The best way to tell if any new "innovation" has merit is to determine how it provides value (usually by solving a problem a lot of people have). You may have some doubts, but to understand where we are, let's quickly consider the different stages of the web.
// Phase 1: Early and doesn't make much sense
Like the internet in the early days (Web 1.0), it was difficult to imagine what the point of the internet considering individuals already had access to information in books, could listen to music or sporting events on the radio and the news was found in the newspaper. It was hard to tell what the real value behind this was besides being cool. In hindsight, it was turning physical goods into digital versions. The transformation into digital versions of various sources information allowed for faster and lower-cost distribution or "on-demand." The downsides of this phase of the internet is the complicated user interface and lack of mainstream adoption. From a product development perspective, we're in this early phase with the metaverse right now.
// Phase 2: Usability for average person increases, utility value increases exponentially
From Web 1.0 to Web 2.0, the user experience improved greatly. Web 2.0 is the current status of the internet. Web 2.0 turned the internet from static content to dynamic content. Users could post content. Websites could display unique information to each user. Netflix and YouTube bring video content mainstream on the internet. Facebook brings social interactions on the internet mainstream. More physical goods and interactions take place online. If the metaverse follows the same development timeline, the forthcoming iteration will bring additional value or utility to the mainstream.
// The purpose of this explanation was to consider that we may be too early to properly judge the immense value this new technological innovation could bring. Ironically, the next phase web IS the metaverse.
Web 3.0 (web3) introduces blockchain technologies such as cryptocurrency, NFTs and the metaverse. More physical goods and interactions go online, past innovations that brought physical assets and interactions online move to a more interactive and life-like 3D animated form of the web called the metaverse.
Ideologically, each element in Web3 is suppose to be built on the blockchain.
// Why it's an innovation
The blockchain is a network of computers that host the software infrastructure the code for the metaverse, NFTs and cryptocurrencies like Bitcoin run on. The benefit of this technology is no one large company controls or owns the data. The user data is owned by the individual users and controlled by a network of computers. The benefit of being controlled by a network of computers versus a single corporation, is it's a lot harder to covertly corrupt millions of people compared to covertly corrupting a handful of executives at a large corporation to do unjust acts with that data. Unjust acts can include bank executives engaging in an illegal activity, governments overstepping privacy or using surveillance, or social networks violating your privacy rights. You have a lot more negotiating power and choice when you own and control your own data.
// Fad or innovation?
To answer whether it's a fad or innovation depends what people create with the metaverse. Like the internet, we could not have foreseen what developed: there were innovations built on top of previous innovations. Society and culture intertwined with these innovations. More of the world will be turned into software, which increases efficiency, scalability, lowers cost, preserves other physical resources and greatly increases the speed of information transfer.
The answer is innovation. Here are the most realistic and likely examples:
// Phase 1: Early and doesn't make much sense
Like the internet in the early days (Web 1.0), it was difficult to imagine what the point of the internet considering individuals already had access to information in books, could listen to music or sporting events on the radio and the news was found in the newspaper. It was hard to tell what the real value behind this was besides being cool. In hindsight, it was turning physical goods into digital versions. The transformation into digital versions of various sources information allowed for faster and lower-cost distribution or "on-demand." The downsides of this phase of the internet is the complicated user interface and lack of mainstream adoption. From a product development perspective, we're in this early phase with the metaverse right now.
// Phase 2: Usability for average person increases, utility value increases exponentially
From Web 1.0 to Web 2.0, the user experience improved greatly. Web 2.0 is the current status of the internet. Web 2.0 turned the internet from static content to dynamic content. Users could post content. Websites could display unique information to each user. Netflix and YouTube bring video content mainstream on the internet. Facebook brings social interactions on the internet mainstream. More physical goods and interactions take place online. If the metaverse follows the same development timeline, the forthcoming iteration will bring additional value or utility to the mainstream.
// The purpose of this explanation was to consider that we may be too early to properly judge the immense value this new technological innovation could bring. Ironically, the next phase web IS the metaverse.
Web 3.0 (web3) introduces blockchain technologies such as cryptocurrency, NFTs and the metaverse. More physical goods and interactions go online, past innovations that brought physical assets and interactions online move to a more interactive and life-like 3D animated form of the web called the metaverse.
Ideologically, each element in Web3 is suppose to be built on the blockchain.
// Why it's an innovation
The blockchain is a network of computers that host the software infrastructure the code for the metaverse, NFTs and cryptocurrencies like Bitcoin run on. The benefit of this technology is no one large company controls or owns the data. The user data is owned by the individual users and controlled by a network of computers. The benefit of being controlled by a network of computers versus a single corporation, is it's a lot harder to covertly corrupt millions of people compared to covertly corrupting a handful of executives at a large corporation to do unjust acts with that data. Unjust acts can include bank executives engaging in an illegal activity, governments overstepping privacy or using surveillance, or social networks violating your privacy rights. You have a lot more negotiating power and choice when you own and control your own data.
// Fad or innovation?
To answer whether it's a fad or innovation depends what people create with the metaverse. Like the internet, we could not have foreseen what developed: there were innovations built on top of previous innovations. Society and culture intertwined with these innovations. More of the world will be turned into software, which increases efficiency, scalability, lowers cost, preserves other physical resources and greatly increases the speed of information transfer.
The answer is innovation. Here are the most realistic and likely examples:
Use Case for the Metaverse and NFTs
As mentioned above, NFTs are an element of the metaverse. NFTs can act as certificates of authenticity for physical assets. Here are some ways the NFTs could be used in the physical world and metaverse.
For example, the certificate of authenticity for a Rolex watch, a piece of fine art, etc. would be digitally verified, meaning someone can’t forge a physical document with a signature on it. To forge the authenticity, an entity would have to decrypt a decentralized security network vs. forging a single piece of paper/influencing a corrupt actor at a single organization.
The best part, everything happens on a public record. More transparency and the prevention of fake records.
Another use case is title paperwork for vehicles. Skip the DMV or need for a public notary, as record of when and where the transaction took place would be public information.
The current stage of NFTs which is primarily art is merely a proof of concept whereas the authentication model could be used in minimum viable product stage.
The most futuristic opportunity is using NFTs as a titles for *digital* assets. If you are a content creator, you could sell your content to someone on the blockchain who could later sell to another person. The content creator could have it set up so he/she receives 5% royalty of every transaction.
For example, the certificate of authenticity for a Rolex watch, a piece of fine art, etc. would be digitally verified, meaning someone can’t forge a physical document with a signature on it. To forge the authenticity, an entity would have to decrypt a decentralized security network vs. forging a single piece of paper/influencing a corrupt actor at a single organization.
The best part, everything happens on a public record. More transparency and the prevention of fake records.
Another use case is title paperwork for vehicles. Skip the DMV or need for a public notary, as record of when and where the transaction took place would be public information.
The current stage of NFTs which is primarily art is merely a proof of concept whereas the authentication model could be used in minimum viable product stage.
The most futuristic opportunity is using NFTs as a titles for *digital* assets. If you are a content creator, you could sell your content to someone on the blockchain who could later sell to another person. The content creator could have it set up so he/she receives 5% royalty of every transaction.
Specific Use Cases for NFTs and Metaverse in Outdoor Recreation Industry
First let's discuss NFT applications:
An important concept to grasp in web3 is the wallet. The wallet houses all your NFTs and coins. The NFTs can be made public, the same way a user has an Instagram or Facebook feed. That being said, any instance an NFT is used it could be something someone wants to show off in their wallet such as ownership of a certain vehicle, a day pass to a certain trail or lake, marina membership, boat club membership etc.
A good framework is to consider paper items that could be digitized or certain life experiences related to your product or service.
Service receipts could be NFTs, stored forever online. An industry wide effort to lobby for digital titles and MSOs, registrations, and other paperwork.
This ownership card could be used to verify for owner-exclusive events, allow online communities to verify members, dealers could easily look up service history, original purchase price, previous owners (in the form of wallet addresses - an anonymous string of letters and numbers) of any vehicle regardless of manufacturer (assuming CRMs post to the blockchain).
Metaverse applications:
Within a digital world, vehicle owners could gather and discuss vehicle related topics, similar to how people talked on forums, then in Facebook groups.
Manufacturers could offer glimpses into ownership with virtual experiences. The next level of sharing a photo or video on social media. This may be what bridges outsiders into our industry. It's a pretty easy way to give someone a near test-drive like experience.
An important concept to grasp in web3 is the wallet. The wallet houses all your NFTs and coins. The NFTs can be made public, the same way a user has an Instagram or Facebook feed. That being said, any instance an NFT is used it could be something someone wants to show off in their wallet such as ownership of a certain vehicle, a day pass to a certain trail or lake, marina membership, boat club membership etc.
A good framework is to consider paper items that could be digitized or certain life experiences related to your product or service.
Service receipts could be NFTs, stored forever online. An industry wide effort to lobby for digital titles and MSOs, registrations, and other paperwork.
This ownership card could be used to verify for owner-exclusive events, allow online communities to verify members, dealers could easily look up service history, original purchase price, previous owners (in the form of wallet addresses - an anonymous string of letters and numbers) of any vehicle regardless of manufacturer (assuming CRMs post to the blockchain).
Metaverse applications:
Within a digital world, vehicle owners could gather and discuss vehicle related topics, similar to how people talked on forums, then in Facebook groups.
Manufacturers could offer glimpses into ownership with virtual experiences. The next level of sharing a photo or video on social media. This may be what bridges outsiders into our industry. It's a pretty easy way to give someone a near test-drive like experience.
Closing thoughts
The companies that embraced each phase of the web benefitted greatly. Some of the same companies that benefitted from the earlier stages of the internet/computer era are back to innovate again: Facebook, Microsoft and Apple.
Considering how much time people currently spend in Web 2.0 and resulting societal change, Web 3.0 digitizing more of our lives could cause massive societal change or simply be a change in form factor for the current internet.
Considering how much time people currently spend in Web 2.0 and resulting societal change, Web 3.0 digitizing more of our lives could cause massive societal change or simply be a change in form factor for the current internet.