The Metaverse: Why Though?
A patented Strategic framework for new shiny things
Before I get into my thoughts on all the new shiny things, like the Metaverse, note to self and to my readers, don’t announce you’re going to start publishing your unwanted thoughts a couple of days before you and your family get Covid. It wasn’t fun, but we made it out in one piece, get vaccinated and stay safe friends.
The Future is already here. We just don’t know what to call it.
Now onto the topics of the year, the Metaverse, Web3, Blockchain, NFTs! What does it all mean and what does it mean for brands? The first challenge is to define these terms, NFTs and Blockchain being the “easy” ones, the other two being way more nebulous. Many have been writing and opining on these areas for quite a while now, and some brands have already jumped head first into them, with very mixed results. There are a lot of interesting pieces on all of these topics, I’ll do a separate post on the ones I found particularly illuminating, but the one I think stands out for brands and suggest you read is from Meagan Loyst at Lerer Hippeau. I share a lot of her definitions of what pieces of the current digital world should matter to brands:
In this post instead, I’m going to try and give you a framework as old as time to evaluate IF and then HOW your brand should enter these spaces. If you’re reading this you most likely already have an opinion on these topics that sits in one of three camps:
UTOPIANS: We are at the cusp of a revolution that will make the world more inclusive and fair. A new decentralized Utopia where Creators finally get a fair slice of the pie and art flourishes like it did in the Renaissance. Brands that don’t jump in NOW are going to become obsolete in a matter of months.
DYSTOPIANS: Bernie Maddoff would be proud, were he still alive, and a bit jealous that he didn’t come up with all of this crap. Crypto, and their artsy cousins, NFTs, are nothing but pyramid schemes designed to dupe us into giving up the last few dollars we have left. Brands that participate are borderline criminals, heck not even borderline, they’re jumping in with the loan sharks.
CAUTIOUSLY CURIOUS: There’s a lot of buzz, hype and noise around these words and while the rest of you shout at each other “Utopia!” “No! Pyramid scheme!”, I’d like to understand what’s going on before my boss/client/mom asks me “what’s our Metaverse/Web3/NFT strategy?” I sit squarely in this camp myself, which is why I’ve decided to “do my own research” on this and figure out what it could all mean for the brands I work with.
I lied.
There’s a fourth, much larger camp: THE MAJORITY OF HUMANITY. Those who don’t know or care about these things and are living much fuller lives as a result, since they most likely don’t work in Marketing. Don’t believe me? Check this out:
Here’s the search volume for “Web3”, which started peaking around the end of 2021:
Let’s add “Metaverse”, which started entering the public sphere after the Book of Faces changed its name into Meta:
Let’s now add the latest craze, “NFT” and see what happens:
Overlay everyone’s favorite money making scheme, “Crypto” and you start seeing something interesting, people are looking at NFTs more lately (better returns maybe?):
“So, what’s your point, these are really big topics!” I hear you say, well, they are sort of big and in some cases not so big, but not nearly as big as something literally everyone is taking about (or so it seems judging by my Twitter and Whatsapp…), “Wordle”:
“But Wordle is just a fad that will soon go away!” you say, and you’re absolutely right. What about a sport that is going to culminate into every Advertiser’s childhood dream in a few weeks, a 30” ad that costs $5M!! Yes, it’s “football”, or better, “NFL”:
Bear in mind, I used a “Worldwide” filter for this analysis, the NFL is notoriously not nearly as popular outside of the US, and yet, look at that massive, massive gap. Try this with any sport, or topical TV show and you’ll get similar results. This is not to say that search volume is the only way to measure the importance of a trend, it’s far from perfect, but it does give a sense of the interest people have in something.
My point is not that these things aren’t relevant for Marketers, but they’re not particularly relevant or important to most consumers around the World, yet. Doing “something in the Metaverse” because everyone around you is talking about it is not a strategy. Also because nobody seems to even agree on what “Metaverse” means…
There is a Future that is real and should matter to Marketers.
For today, I’m going to focus on “The Metaverse”, because despite the fact that the word itself seems to mean many different things there are some real things Marketers need to be aware of and considering. NFTs and Web3 I think are a lot more controversial and I will address at another time.
If you read Meagan’s post or have been following cultural trends you know that there are already virtual worlds with significant scale that brands can play a role in, like Roblox, Minecraft, Fortnite, and more. These are not technically Web3 by the way, because they’re not on Blockchain. Are they Metaverses? Allegedly, there’s only one Metaverse that we all already live in, some will say to you. Does any of this really matter if your objective is to connect with consumers? Not really. I would challenge you to find more than 5 people playing Fortnite who say “yeah man, I love being in the Metaverse!”
Let’s look at their size and revenue:
People are spending $5.1 BILLION a year on skins on Fortnite, which give you absolutely no advantage in the game other than looking cool and being on trend.
This is why we should pay close attention as Marketers. There are massive digital worlds/spaces/places where people are spending a lot of time and money, and you can’t reach them with ads. Do these people also spend time where you can reach them with ads? They do. Is that reason to ignore what these spaces could allow brands to do that is much more interesting and potentially powerful? It’s not.
This is one of those moments where FOMO is going to drive a lot of brands to waste money and look silly doing it, while a very few get praised for their innovative spirit. It’s a time when anyone managing a brand will get a call from some innovation guru selling them a really expensive shiny new thing that they won’t fully understand. It’s a time to learn what is truly sticking with consumers and what is just hype, a time to experiment or wait and see. Most important of all, it’s a time to figure out how brands can play in these new spaces without doing what we do best, annoy people.
Why Though?
So let’s start with my patented Strategic framework and the question you should always ask yourself before jumping into/onto a new trend/fad/revolution: Why though?
No, I’m not referencing everyone’s favorite Linkedin Influencer Marketing Guru who coined “Start with WHY!”
I’m asking you to think about the reaction you absolutely want to avoid consumers you’re trying to impress from having:
For us boomers in the room, Why Though? Why did you do this "[Insert brand name]?! And just to clarify, this isn’t them asking to understand your strategy, this is them looking annoyed saying “why did you come into our spaces and do this thing none of us want to have anything to do with?”
As silly as it may sound, asking yourself “Why Though?” is going to push you to figure out not just IF you should be playing in a space, but also HOW. For example, take the work Nike is doing with Nikeland in Roblox, which I think is very interesting and a great example of “Why Though” in practice. Nike long ago understood the importance of creating fun retail experiences and cool activations to bring their products to consumers in new and interesting ways. They have a rich and successful history in deploying cool experiential activations in the real world (check out this link for some of them). Creating an exaggerated version of a Nike Store in Roblox makes perfect sense as an extension of this strategy.
Nike knew that they could enter this space credibly and build something that not only didn’t cause consumers to say “Y tho?!”, but to jump on board and have fun with. They have a lot to give to consumers who are either already in these spaces or are massive fans of their brand and used to trying new things.
How is performing for Nike? Seems reasonably popular and 10M visits is not bad at all considering this is a lot more engaging than an ad on Facebook getting 10M impressions:
Compare it to one of the most popular games on Roblox, “Adopt Me” and it looks microscopic:
Did it move the needle for Nike in significant ways with mass consumers? Don’t think so:
And that’s OK! Nike isn’t expecting massive returns right now, they know that these spaces are somewhat nascent and could lead somewhere magical, and that they are a brand that can go in with compelling propositions for consumers. More importantly, they’re going at it with a very carefully thought through Strategy that is a natural extension of the rest of their Marketing. Not all brands are anywhere near being ready to jump in like this.
This is the key to success, or at least limiting failure: understanding who is already engaging with these shiny new things and thinking very hard about whether they want to see your brand in there or not. Once you’ve figured out that we’re talking mostly about early adopters, young consumers, and a lot of very savvy marketing and tech folks with money to try things, you’ll have a better sense of whether now is the right time for you to jump in. This should help you determine how you’re going to jump in and how you’re going to do something these consumers will enjoy, find value in, not reject.
I’ll write more about that in future posts, but I’ll leave you with something I think all Marketers should consider, the fallacy of first mover advantage. Once a revered business strategy, first mover advantage has been proven to be way more risky than rewarding. When’s the last time Apple created a new category from scratch? The iPhone you scream! Not really no, both smartphones and touch screens already existed. Apple Watch you say with a smirk? Wearables already existed. Apple looked at these categories, saw massive potential and learned from the mistakes of first movers to then come in at the right time and dominate. Jumping into new trends with an Ad campaign or a Brand partnership isn’t the same thing, I know, but there are important parallels to be made. If you choose to be at the cutting edge of Marketing, you usually get one shot to impress early adopters. They are very passionate about the thing you’re jumping into (check out anyone who is a Web3 or NFT evangelist on Twitter…) and will fiercely rebuke your pathetic attempt to be cool with them. Most consumers won’t even know what you did, so I guess you could say that the risk is just that you might alienate a small group of people, worth it no? Not if you really think these areas are going to be big, and not if you want to be known as a brand that “gets it”. The stench of trying too hard to be cool is very hard to wash off, sometimes it’s much better to be a fast follower, most of the time it’s even better to be a third or fourth mover.
The road to Cannes, and frankly the stage, are littered with ideas we all love in our little insular industry but consumers could not care less about. Soon enough I’m sure we’ll be celebrating a Metaverse Lion. Why though…