Developing an effective Metaverse strategy that makes sense for your organization, without getting overwhelmed by today’s trends, is not that easy. ESCP experts Marie Taillard, Professor of Marketing, and Howard Zhong, Assistant Professor Information & Operations Management, share their thoughts on getting the best out of this rapidly evolving technology.
Let’s start by examining the business world’s love affair with the Metaverse. Why are business leaders attracted by the concept?
Marie Taillard: It’s simple: an environment like the Metaverse, in which consumers can be tracked and observed is fundamentally a dream come true for marketers and businesses. Being caught without your own position or strategy for a Metaverse future is a clear–cut case of business FOMO [fear of missing out]. Together, these two tendencies go a long way towards explaining business leaders’ attraction.
Howard Zhong: As an environment where businesses can create custom experiences for their target audiences, the Metaverse represents a unique opportunity to build brand awareness and drive sales. The possibilities are almost endless. Businesses can create virtual experiences that are realistic and engaging, like virtual stores, product demonstrations, and interactive experiences. Essentially, the Metaverse offers a new way to reach and connect with customers and employees for all types of businesses – which is obviously part of its attraction.
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What potential does the Metaverse have for brands other than profitability?
Howard Zhong: I believe that the Metaverse has the potential to revolutionize how businesses operate, from improving productivity and reducing expenses to building communities and reinforcing brand fidelity.
As I just mentioned, the Metaverse provides a great opportunity for businesses to experiment with new ideas and technologies in a safe and controlled environment. This makes it an ideal testing ground for businesses looking to gain a competitive edge.
Marie Taillard: I’d go even further. Relationships between brands and consumers will continue to evolve, with more control than ever going to consumers – and the Metaverse is sure to accelerate this trend. The concept of the ‘Decentralized Autonomous Organization’, used to describe communities such as Ethereum, is indicative of this trend towards decentralization and autonomy. Brand owners beware – start getting ready for a drastic shift in the power relationships you have with your customers!
Is a presence in the Metaverse a must-have for every business?
Marie Taillard: I think it’s too early to venture a guess on which kinds of businesses will be more successful in the Metaverse. However, I do believe that businesses across sectors will be able to craft a winning strategy for the Metaverse if they begin challenging some of their long-standing beliefs. As with any new technology, the Metaverse has the potential to really put customers at the core of the business model – something that any business should be interested in.
Another common mistake is failing to plan for scalability. The Metaverse is still in its infancy, but it’s growing rapidly. What might work for a small group of users today could quickly become unmanageable as more and more people flock to this new frontier.
Howard Zhong, Assistant Professor Information & Operations Management at ESCP Business SchoolWhat are the first questions one should ask when deciding whether or not to invest time and resources in Metaverse projects?
Marie Taillard: When it comes to this kind of long-term, speculative investment, it’s important to ask strategic questions – I’m a little sceptical of ‘quick wins’. How is the project going to be integrated into a credible long-term strategy? What resources will it require? How does it fit in with existing digital initiatives?
This isn’t to say that there isn’t room for testing through small-scale projects, but even these need to be part of a deliberate effort to envision how the Metaverse will fit in with the broader strategy.
Howard Zhong: Without a clear objective and idea of the target audience, it’ll be difficult to measure success or properly leverage the Metaverse. What problem are businesses hoping to solve or what opportunity are they looking to capitalize on? I’d try to avoid falling into the trap of ‘must-have trending tech’ and seriously consider how, when and why you’re planning on allocating resources to a Metaverse project.
What are some of the most common pitfalls when it comes to launching in the Metaverse?
Howard Zhong: As I mentioned earlier, without a clear purpose, it’s easy to get lost in the vastness of the Metaverse and end up wasting time and resources. The Metaverse is new and unexplored territory for many users, and it’s important to remember that not everyone will be familiar with the ins and outs of navigating this digital world.
It’s important to make sure that your launch is intuitive and user-friendly, or you risk losing potential customers before they even have a chance to explore what you have to offer.
Another common mistake is failing to plan for scalability. The Metaverse is still in its infancy, but it’s growing rapidly. What might work for a small group of users today could quickly become unmanageable as more and more people flock to this new frontier.
Make sure you’ve got the resources necessary to keep up with demand and prepare for a large influx of new users. Also be aware that there is still a lot of work to be done in this space before it’s ready for mainstream adoption.
What’s interesting about the Metaverse is that it forces us to think beyond current business models or value creation formats. It’s about taking social initiatives such as forums, communities and open innovation to the next level, where brands have a chance to engage with empowered customers who create value by doing what works for them, not what we get them to do.
Marie Taillard, Professor of Marketing at ESCP Business SchoolAre brand initiatives in the Metaverse similar to other previous online spaces, such as forums or online gaming? What lessons can be learned from those sectors to ensure a successful integration of the Metaverse?
Marie Taillard: What’s interesting about the Metaverse is that it forces us to think beyond current business models or value creation formats. It’s about taking social initiatives such as forums, communities and open innovation to the next level, where brands have a chance to engage with empowered customers who create value by doing what works for them, not what we get them to do.
The gaming industry is probably the best to learn from because it succeeds in creating this kind of environment – one that allows customers to engage with brands on their own terms and in a way that augments their experience rather than constraining it.
Many people believe the Metaverse is just a passing trend – do you believe this is the case? Why or why not?
Howard Zhong: I don’t think so. The Metaverse is a disruptive technology that can potentially change people’s lives from various perspectives. On a basic level, the Metaverse allows for a greater degree of user interaction and customisation. Coupled with blockchain technology, people’s assets in the Metaverse are assured and secured, which enables business transactions and trades in the virtual space. Finally, metaverse technology is constantly evolving, especially with the integration of other new technologies. On a personal level, I’m looking forward to seeing where it will go in the future.
Marie Taillard: The wider concept of the Metaverse certainly isn’t a passing trend. On the other hand, it’s important to understand that the Metaverse itself will be a moving target. As with all other types of tech that have gone before, all of these developments are bound to continue to evolve, just like how we use them.
Finally, what tips would you give for the Metaverse neophyte? Should business leaders go all in on the Metaverse now or do we require patience?
Howard Zhong: First, make sure you’re clear about the business’s goal for using the Metaverse and understand from which perspective the Metaverse can help boost your business. Second, decide on the best timing for the launch – earlier adoption isn’t always better. Finally, once you have decided on the integration, try to do it step by step. Start testing the first few ideas with small investments and then expand. Slow, smooth and steady wins the race.
Marie Taillard: My advice: You’ll need a healthy dose of patience, humility, empathy, creativity, critical thinking, as well as a willingness to collaborate, test and learn, and challenge conventional wisdom. In other words, have fun but be cautious about trying this at home (or at least, not without a fire extinguisher!).
This interview was first published on ESCP Business School's media, The Choice.
