The impact of the Metaverse on Digital Marketing Strategies and Paid Advertising
The metaverse is coming and it will change paid advertising, social media performance, and paid social forever.
The Metaverse is Coming. It is true.
Although the metaverse started as a Sci-Fi term, it is increasingly becoming more real. Facebook changed its name to Meta; this was not a rushed or unexpected move, but rather a strategic one. After all, they are a technological company and their goal is to stay up-to-date with what is possible in the industry.
Before we go any further, it is essential to understand that the ‘metaverse’ is a concept not a thing. Therefore, it cannot be owned; Meta (formerly Facebook) is just making a statement for what they think will be the future of the industry.
The metaverse will surround us and become the new normal. It will allow us to immerse ourselves in interactive experiences and share them in real-time worldwide. This will impact human behaviour, and marketers will need to adapt and develop new marketing strategies. Brands will use paid advertising to appear in banners at eSports events. Social media performance will reach new heights through interactive marketing campaigns. And paid social will be a thing of the past.
What is the metaverse?
The metaverse is often defined as a 3D virtual space where people use avatars to work, play, shop and socialise. While this is correct, the metaverse will also surround us and become part of our day-to-day life thanks to the internet of things (IoT) and Augmented Reality (AR). The metaverse does not exist yet; however, all its pieces are already coming together. It is a combination of Web 3.0, blockchain, and virtual and augmented realities (VR/AR).
Let’s understand each piece individually:
Web 3.0 is the new iteration of the internet; we are currently in a state of transition from Web 2.0 to Web 3.0.
First, we had Web 1.0, where users accessed the internet only to consume information (i.e. read-only). Then came Web 2.0: the interactive phase of the internet where almost everything is clickable. Here, users can engage with creators and other users through likes, reactions, and comments. These interactions skyrocketed social media performance, and companies started to collect information from users on a scale never seen before.
Today, brands plan social media strategies and achieve segmentation through the analysis of this data. In web 3.0. brands will have automated protocols that analyse the data for them. These protocols will also get better with time using machine learning. In Web 3.0, Artificial Intelligence (AI) and machine learning will be standard parts of the system
Another significant evolution of Web 3.0 is the ability to prove ownership of digital assets through blockchain technology. This revolutionary technology entails a whole world of opportunities and is changing the way businesses operate globally.
Blockchain, as its name implies, is a chain of blocks. Each block is digital and contains transaction details that cannot be changed. Once a block is filled with transactions, another block is added to the blockchain. However, before a new block can be added, it has to be linked to the previous block through cryptography, thus creating the chain.
In other words, blockchains are virtual ledgers that hold every transaction ever made. Once a transaction is added to the blockchain, it will be there forever, immutable. This ensures transparency and security. Blockchain will be the backbone of the metaverse through digital currencies, smart contracts, and non-fungible tokens (a.k.a. NTFs).
Another important feature of blockchain technology is that it allows decentralization, meaning that there is no single entity that controls it. Instead, the blockchain is controlled by the network. This is because each transaction has to be verified by the network before it makes its way to the blockchain.
The blockchain is a complex concept. If you want to read more about it, you can do so here.
These will be the two main entries to the metaverse. One where we use gear that takes us to a whole new world without moving from our living room, and the other where the outside world becomes interactive. We will immerse ourselves in VR, while AR will bring the metaverse to the real world.
Companies like META (formerly Facebook) are investing millions in the development of VR with Oculus. At the same time, Niantic leads the way on the AR side. These technologies are facing exponential growth and their momentum does not look like slowing down anytime soon.
How will human behaviour change?
Depending on the way entry to the metaverse (VR or AR), it will primarily affect human behaviour in one of two ways: Sedentary and Active. The pros and cons of VR and AR are outside of the scope of this article, but whichever we choose will provide us with a broader range of connections through Massive Interactive Live Events (MILE). People will be able to share immersive experiences together irrespective of their location in the world. This is an excellent opportunity for the marketing industry; paid advertising will be redefined.
Some companies have already started to tap into what is possible with MILEs. Games like Fortnite and Roblox have held live music concerts with millions of attendees. Their reach was even greater when counting the people that watched the events through streaming platforms like Twitch. In the metaverse, the data analytics power of Web 3.0 will bring great opportunities for target marketing at these events.
How will social media change?
Although some of the pieces of the metaverse are already in rapid development, the opportunities within the Social Media industry are still untapped. A decentralised social media platform has not gone mainstream yet. However, one sure thing is that profile photos will not be static anymore. They will be replaced by live avatars that represent us, and they will be unique and valuable through the use of NFTs.
NFTs are digital assets with proved ownership thanks to blockchain technology.
Another prediction is that these avatars will be universal and usable across all platforms requiring a single login. This will be achievable through the decentralised nature of Web 3 and blockchain technology. Instead of scrolling through endless feeds, the social media experience in the metaverse will be more like a walk in the park with interactive and seamless cross-platform posts.
These interactive experiences will redefine social media performance. Social media engagement through gamification strategies will be the standard. And machine learning and AI will allow effortless data analysis and market segmentation.
What will be the new digital marketing strategies?
Brands will have to develop marketing strategies that make them visible in the metaverse. VR/AR content creation will be at the core of these strategies. Marketers will have to focus on enhancing the user experience rather than interrupting it. This will be possible through gamification strategies, paid advertising, and NFT’ss.
Gamification will enhance engagement and create new flows of data that will be very valuable for marketers. Paid advertising will be popular at MILEs and other digital events like an eSport tournament; the reach of paid advertising, when used appropriately, will be immense. NFTs will be great for branding campaigns that want to test their products digitally before a real-life launch.
Another marketing strategy will be the real-life benefits that holding NFTs bring. For example, using an NFT accessory like a shirt in your avatar could warranty early access to new products.
Many things need to happen in the technology industry before we reach the complete assembly of the metaverse. However, its parts are already being developed, and they look very promising.
The metaverse will change everything, from human behaviour to business models to marketing strategies. Some of this change can be predicted as some companies are already tapping into what is possible. However, everything that was written in this article is purely speculative.
The only sure thing is that the metaverse will allow marketers a much wider yet targeted reach through social media performance and paid advertising.
Are you interested in the metaverse?
Would you start an NFT campaign?
Let us know in the comments.