From eCommerce to iCommerce; How the Metaverse Will Revolutionise Shopping
As we step into the metaverse, the next iteration of the internet will create an entirely new channel for brands to connect with their consumers. Where the internet ushered in the eCommerce era, the metaverse will start the Immersive Commerce, or iCommerce, era, and many brands are already exploring creating unique experiences in the metaverse.
Digital products will become the norm, and content creators will be able to monetize their work in ways we cannot yet imagine. Instead of Direct-to-Consumer, we have now entered the realm of Direct-to-Avatar (D2A). D2A means that brands sell their products only in the virtual world. These digital products will never leave the virtual world. Before the end of this decade, Direct-to-Avatar will have surpassed B2C business models, and iCommerce will be significantly bigger, potentially surpassing eCommerce. This new channel will revolutionize how we shop online, moving from ‘click and buy’ to ‘experience and buy’, enabling users to experience a product virtually before the physical version is delivered to your door.
IKEA’s Place app is one of the leading examples of using the ‘experience and buy’ model. IKEA offers a unique experience to customers while, undoubtedly, generating a stream of additional user data. It was one of the first mobile shopping apps that took full advantage of ARKit, Apple's augmented reality framework. It allows users to digitally try out furniture to understand better how that new couch or table would look in their house. Linking such digital customer interactions directly to your organization's business intelligence would offer invaluable, real-time insights into who is interested in what, when, where and why.
The fashion industry is also embracing this new channel. Digital fashion houses that sell digital clothes in virtual worlds such as Roblox or The Sandbox is just the start. In the coming years, we will see brands sell NFTs with utility to be used either in specific metaverse environments or the physical world. For example, buying digital sneakers that allow you to run faster in Roblox will also give you a discount on the physical sneakers or vice versa. This convergence of physical and digital shopping enables brands to sell the same product in the physical and virtual worlds, significantly increasing their revenue opportunities.
A great example is the American fashion retailer Forever 21, who developed a unique community-first brand experience for Roblox, launched at the end of 2021, which allowed Roblox users to operate their own Forever 21 store. According to Justin Hochberg, CEO of the Virtual Brand Group, who assisted Forever 21 with their metaverse adventure, the brand actively worked with Roblox creators, designers and influencers. It gave them a platform to showcase, and sell, their designs. Moreover, Forever 21 will release new collections simultaneously in the physical and digital world, enabling users to match what they wear in the real world with what their avatar wears in Roblox, creating a brand unique experience.
Think Out of the Box
iCommerce is not about just duplicating your physical store inside the virtual worlds. Brands that will follow that path will most likely not succeed. After all, the metaverse is not an additional marketing opportunity but an entirely new distribution channel with its own rules and requirements. Generation Z is digitally savvy, but Generation Alpha will be metaverse-savvy. They know how to navigate the immersive internet and appreciate its ease of use. They have grown up playing Roblox or Minecraft, and they want brands to be there where they are, offering native immersive experiences. That will not be on YouTube, Twitter, or Facebook.
Brands must take a different approach to succeed, such as Balenciaga, Gucci, and Dolce & Gabbana have shown. iCommerce provides endless opportunities to engage with customers. Still, brands must think out-of-the-box about how they want to be perceived in the metaverse and what their brands stand for, if they are to be successful with iCommerce. It is a different ballgame altogether.
iCommerce is not only about purely virtual experiences. It is also about bringing the digital into the physical world using, for example, magical mirrors as happening already on a large scale in China. These intelligent dressing mirrors can show yourself wearing different outfits suggested by the mirror, which you can then purchase by scanning a QR-code. In addition, when taking clothes into the fitting room, the mirror can suggest additional matching items for you. The next step would be that your avatar would receive the digital version as well, potentially with other benefits.
From Digital to Physical
iCommerce has more advantages for organizations. Retailers can experiment and co-create their products digitally with their customers to create better products. It also means that purely digital brands can go physical, drastically lowering the entry barriers to starting a fashion brand. Metaverse-native digital fashion brands can become so popular in the virtual world that people request digital items to be created as physical items. The moment the first metaverse-native brand develops physical fashion items will be a wake-up call for the entire fashion industry, and it won't be too long to happen.
Digital products will usher in a new era of limitless opportunities for retailers and customers. It will make the retail industry richer, literally because (fashion) brands will be able to make a lot of money and figuratively because it will enable consumers to explore new identities using digital clothes and wearables and have a richer (brand) experience. Already in 2017, way before the crypto boom or the NFT boom, trading virtual (fashion) items in video games was a $50 billion industry.
We can expect the iCommerce industry to grow exponentially in the coming years. For organizations that want to explore the metaverse, the time is now to investigate, and if you are interested in exploring how your brand can step into the metaverse, feel free to contact me.