The Economic Viability of the Metaverse: Can Retail Live Up to Expectations?


Dedrick Boyd is an international e-commerce strategist and the founder of TechSparq

The metaverse may still be in its infancy, but the term has certainly taken the global cultural lexicon by storm. It remains more conceptual than tangible, allowing endless guesses as to whether it will destroy or save humanity. However, the economic viability of the metaverse still makes web 3.0 a literal and figurative wonderland for retailers bold enough to pioneer this new territory.

In a recent interviewCathy Hackl said, “If the internet and social media have changed your business or the way you interact with people, you should pay attention to what 3.0 and the metaverse will do because it will change those things too.” One thing we can all agree on is that NFTs (non-fungible tokens), AR (augmented reality), VR (virtual reality), cryptocurrency, blockchain, and other emerging technologies and experiences are all part of what will become the metaverse. become.

As an ecommerce strategist, I’ve found that a lucrative source for metaverse participation is the demographics of Millennials and Generation Z. Today, Millennials and Generation Z adults represent 35% of the luxury market, but are expected to account for 50% by 2025, according to research Boston Consulting Group† Lifestyle brands looking to reach Millennials and Generation Z shoppers should consider moving to virtual shopping, but not necessarily in the iteration that exists today, as most virtual shopping environments offer Google Maps-type navigation where you click a point. and in a “zoom” around 2D room, made to appear 3D.

Meeting customer expectations

The Millennials and Generation Z demographics are digital natives and have had access to the internet all their lives. In fact, according to Fortune, 87% of Gen Z and 83% of Millennials play video games weekly, if not daily. In my opinion, the current virtual shopping experience is rudimentary and unrefined, and these young consumers expect a truly immersive 3D experience. They have become accustomed to having full control over an avatar, including fishing and positioning 3D products. They crave rich interactions and the opportunity to socialize with their friends when they are online.

They also expect brands to know who they are: these are social shoppers. They want unforgettable experiences with their friends, and they expect these experiences to be very personal. They flock to unique brand collaborations and want to feel pampered and valued. Finally, they expect the digital experience to be within reach anytime, anywhere. Lifestyle brands must find a way to meet their demands if they are to earn their commitment and hard-earned dollars.

Lifestyle brands may consider offering virtual shopping experiences that are immersive, allowing consumers to move and socialize with their friends in enhanced 3D virtual stores, as well as control the angling and positioning of 3D virtual products. This is how millions of people around the world interact in today’s very popular online multiplayer games. The social and collaborative aspects of this demographic are central, and the journey itself matters. Salesforce survey (registration required) shows that 80% of consumers say the buying experience is just as important as, if not more important than, the product purchased.

Hidden Economy

While Generation Z and Millennial demographics are the most sought after by lifestyle and luxury brands, I think it would be a huge, missed opportunity for Baby Boomer and Generation X shoppers to overlook. These older demographics naturally have a higher amount of wealth and disposable income compared to their children and grandchildren. According to a 2020 Bloomberg report, baby boomers have more than $3 trillion in accumulated wealth. Generation X may be a smaller generation compared to millennials and baby boomers, but they good for 31% of all US income. In addition, their income is on average higher than all other generations.

It would also be a mistake for brands to assume that Generation X and Boomers in particular are not tech savvy or particularly involved in immersive commerce (iCommerce). According to a Washington Post article, consumers age 65 and older are the fastest growing segment of online shoppers and 49% more spent on the web in 2020 than the year before. They are also heavy social media users. According to Pew Research Center, the use of Facebook among the older generations has grown the fastest in recent years. Now that Facebook is rebranding itself as Meta, this maneuver could serve to create a channel into a lucrative, untapped market for the metaverse.

Generation X may not be as tech-savvy as their younger counterparts, but that doesn’t mean they’re intimidated or put off by these newer technologies. Generation X is, in fact, the original tech-savvy generation, as the PC and home console industry was spawned during their early years. I’ve found they have the highest brand loyalty of all other generations, and they tend to stick with retailers who take care of them and provide a consistently seamless experience.

Daring pioneers win

A metamorphosis is underway, driving customer engagement through interactivity. Shoppers increasingly demand more detail and transparency, and they want to feel connected to the brands they love. iCommerce helps brands abstract the technicalities so that people can communicate, shop, experiment and have fun. Immersive experiences provide lifestyle brands with a means to evolve current e-commerce offerings without alienating Gen X and baby boomers. A subtle shift to iCommerce could give bold pioneers a path to drive sales, increase online brand awareness and increase engagement.

By focusing on the immersive experiences now possible in virtual shopping platforms, lifestyle brands can make a thoughtful and confident leap into the metaverse, knowing they are exceeding expectations from generation to generation and meeting their customers right where they are – wherever they are. may be. Business Council is the leading growth and networking organization for entrepreneurs and leaders. Am I eligible?


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