Tushar Gandotra is the chief executive officer and founder of FiEx, a leading platform that offers safe and secure digital assets and NFT transactions. Graduated with a Bachelor of Computer Application (BCA), Tushar received his Master’s from Symbiosis Centre, IT Pune. Tushar has always been enthusiastic about integrating technology into business and in his current strategic role as CEO, he’s powering the growth of FiEx through devising strategies and implementing plans.
Luxury brands can leverage the growing influence of metaverse though they need to take a measured and calculated approach to win over customers in the digital space.
Metaverse: New Buzz Word
The term metaverse is getting more popular by the day. It has found mention in many new discourses and unsurprisingly, we have also heard the term from the top echelons of the industry, be it Mark Zuckerberg of Meta or Satya Nadella of Microsoft.
Like it’s growing mentions, the value of metaverse as an industry is also booming. According to an estimate by Bloomberg, the category will soon reach the mark of $800 billion, indicating the rising interest of the masses in digitally connected and immersive universes.
What’s there in store for Luxury Brands?
With such an immense potential to tap into, brands are jumping onto the bandwagon of the metaverse. Right from the gaming industry to online fashion and from social media platforms to sportswear companies, everyone is scrambling to have their share of the pie. Specifically, luxury brands catering to the top-tier customers are finding metaverse aligned with their aspirations.
That said, remaining relevant even amidst the constantly evolving digital space is not an easy job to accomplish. And this is exactly what prompted us to come up with specific guidelines that luxury brands must adhere to carve a place for themselves on metaverse platforms:
a) Stay updated with evolving paradigms: In order to stay relevant in the age of metaverse, it is essential for luxury brands to keep up with changing business paradigms. For example, Dolce & Gabbana luxury fashion brand that holds the record for selling an NFT collection of 9 pieces for $5.7 million made clever use of marketing campaigns to promote NFTs as “Gems that can’t be found on the earth”.
Similarly sportswear brand Nike created Nikeland on the platform of Roblox to enable buyers to try their virtual sneakers. The primary idea behind the Nikeland is to make visitors aware of physical activity and its importance in enhancing the quality of their life.
b) Convincing Logic: Creation of digital assets on metaverse is one thing but getting maximum value for it is another. The principle of exclusivity works well for the pricing but that’s not enough. What luxury brands need rather is the combination of exclusivity and logic.
Take, for instance, the DressX. The digital fashion app recently revealed that the carbon footprint of one digital item created on the internet is 97% less than that corresponding to the physical garment. As the garment industry is responsible for 10% of the total carbon dioxide emissions globally, this logic can immediately ring a bell with most potential buyers.
c) NFT Merchandise: This is possibly the most important and lucrative opportunity available for luxury brands to expand in the metaverse sphere. Brands can partner with like-minded organisations to come up with their exclusive digital avatars and promote these among the communities.
For example, the Genies fashion community recently came together with Universal Music Group to launch their digital avatars specifically targeted at Gen-Z customers. Along the same lines, luxury brands can capitalise on the opportunity and come up with their own exclusives for finding favour with potential buyers. In fact, many NFT platforms are also looking to extend these kinds of partnerships with celebrities and other brands for better visibility and customer reach.
d) Collaborative Approach: The fact that metaverse space is in a state of constant churn calls for the adoption of a collaborative approach. Aspiring luxury brands can come together to make partnerships and work on a common platform for spawning new products or services in the digital space.
This collaborative approach can be taken one step further by sharing the blueprints and resources for the project that participating organisations intend to achieve as an end result. This approach can also help the industry to build a common repository of the standards and frameworks for helping future projects.
e) Avoid Quantum Leap: Although it might sound counterintuitive, it’s better for brands to start slow and start small. Metaverse is making its way into consumers’ psychology and instead of making far-fetching decisions, brands should explore each and every facet of this emerging space in detail before going ahead. As buying habits in digital space are considerably different from the physical world, it’s recommended for the companies to explore the space incrementally rather than trying to grab the entire market in a single stroke.
Adoption of metaverse in the business philosophy is an ideal scenario that luxury brands should strive for. Of course, the way ahead is challenging especially considering the fledgling nature of the domain but the enormous potential virtual worlds offer to luxury brands make it worth all the effort, time, and investment.