The Metaverse is is a collective virtual shared space, created by the convergence of many virtual worlds, including augmented reality, Bitcoin/blockchain, the gaming industry, and the entire Internet.
Digitization—or tokenization—is the crucial next step for luxury brands to capture the market opportunity presented with Bitcoin, Ethereum and the latest NFT renaissance that is happening in front of our eyes.
Creativity is the greatest constraint to NFTs—and we believe this is a competitive differentiator for many of Troika's clients. Brands are quickly learning in 2021 how to leverage local artists, data, technology and creative thinking to create new and exciting fan experiences in the Metaverse, and solve real problems.
We estimate the market cap of the Metaverse to be over $30 trillion—capturing the entire Web 2.0 internet as well as augmented reality (AR), virtual reality (VR), gaming, esports, cryptocurrency, and the list expands by the day.
According to some analysts, the Metaverse is so big it expands to over 1,000 times the size of Earth in comparable physical space. Most of the data graphics of the metaverse are in 3D and exist either on a screen or in virtual reality, and they require real energy (on planet Earth) to maintain.
Metaverse advocates will argue that the digital world can be as "real" as the physical world because of the immense power of the human brain. In the future, there will be a real balance between the physical and the virtual worlds, and Web 3.0 protocols will be the infrastructure that keeps them together.
In June, Facebook CEO Mark Zuckerberg told employees that Facebook would become "a metaverse company" and would strive to build interconnected digital experiences for people around the world. It will be an “embodied internet,” said Zuckerberg, run by decentralized organizations.
In April 2021, Prada Group, together with LVMH and Cartier, part of Richemont, announced the creation of the Aura Blockchain Consortium which will promote the use of a single global blockchain solution open to all luxury brands worldwide to provide consumers with additional transparency and traceability.
The Aura Blockchain Consortium makes it possible for consumers to access product history and proof of authenticity of luxury goods–from sourcing to sales, and all the way to secondhand markets.
Consignment companies like TheRealReal and Rebag may also play a critical role in helping brands "3D scan" their products into the Metaverse without losing their inherent value. Consumers may want to enjoy their watch or handbag collections in the digital world the same way they do in real life.
In December 2020, wine shipping firm eProvenance and IBM jointly announced the launch of a blockchain platform, VinAssure. It uses uses various technologies such as AI, blockchain, and the cloud to securely track wine throughout the supply chain, from the vineyard to the consumer.
The VinAssure blockchain ecosystem has its own set of users and governance to show transparency in the storage conditions across the entire supply chain and helps increase accountability and data processing times.
Gucci is investing into apps, games, and other digital experiences to hedge against the retail risks caused by the pandemic. Gucci recently launched the Gucci Garden as an interactive experience to show off their latest Spring and Summer handbag collections.
The Gucci Garden features Ground Floor, First Floor and Second Floor maps and experiences. Each floor has engagement areas such as an Entrance, Boutique, Bookstore, and shopping areas for all of their product collections. Each item can be viewed in HD with a 3D view of the real object.
The metaverse opens up a world of possibilities for brands that are not just fun and games. Luxury goods and wine are just two of the many industries that struggle with fraud, counterfeit goods, plagiarism, poor transport conditions, data loss, misinformation, and other supply chain errors.