What opportunities does the metaverse offer luxury brands in 2022?

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The convergence of our physical and digital worlds through metaverse platforms is quickly becoming a significant opportunity for luxury brands. Our time during the pandemic has taught us that there are limits to the physical world – but also that many of the virtual alternatives we have created may even be preferable to the real ones. In 2022, brands will find that they will need to maximize their digital presence and continuously integrate emerging technologies to stay relevant.

Yet, many companies have already taken the luxury and retail metaverse by storm. Gucci sold a Dionysus digital handbag for thousands more than the retail price of the physical bag. And Dolce & Gabbana set a digital fashion record with the sale of a nine-piece, $ 5.7 million NFT collection featuring “stones not found on Earth.” Meanwhile, Nike has built its own metaverse experience called Nikeland on the Roblox platform and recently acquired virtual sneaker and collectibles startup RTFKT Studios.

At Nikeland, which is inspired by the actual Nike headquarters, users can play games and dress their avatar with special Nike products. Photo: Nike

With no expensive raw materials and no painstaking hand stitching, Metaverse designs are almost purely lucrative. Not only that, but the combination of creativity and exclusivity that can only reach new heights digitally causes some virtual products to sell for significantly higher prices than their physical counterparts.

While some companies have popularized digital versions of their flagship products, others have tested the waters by first posting new product ideas in the Metaverse. Then, after assessing their virtual demand, they could be considered for physical production. The metaverse may also become a new way to shop online, where consumers can browse digital showrooms and purchase virtual and physical versions of products on display.

Virtual products have also boasted of significant appeal through a lens of sustainability. According to DressX, a digital fashion startup, producing a single digital garment requires 97% less carbon emissions and 872 gallons of water less than a physical garment. Plus, there’s no heaps of unsold inventory left over from previous seasons. Digital offerings can therefore help rectify an industry notoriously known for its wastefulness.

But perhaps the most notable benefit of the digital switchover is increased traceability, where blockchain-based ‘smart contracts’ allow a business to continue to collect royalties every time an item is resold. Likewise, this tracing using blockchain technology makes it possible to bridge the gap in terms of transparency and guarantees of authenticity. For example, thanks to Aura – a private blockchain consortium founded by LVMH, Prada and Richemont – buyers now have access to information about a product’s entire supply chain, from the sources of its raw materials and factories to domains. after-sales interest such as after-sales service. and used sales.

While many brands are eager to jump on this digital trend, the field of metaverse and related technologies still have a long way to go. Baidu has told the public that its new XiRang metaverse app is still at least six years away from a full launch. Alvin Graylin, Chinese president of smartphone and virtual reality company HTC, echoed Baidu’s more conservative stance, saying that a full metaverse was still in the works and would require the establishment of an underlying infrastructure. and international regulatory standards.

Baidu’s Xirang app, which is still in its infancy, allows users to explore different virtual environments. Photo: Weibo

However, China may have unique advantages in the metaverse race. China is a leader in the adoption of 5G and mobile internet infrastructure. In fact, this month, a government-backed 6G project led by Purple Mountain Laboratories in collaboration with China Mobile and Fudan University for the first time achieved a world record for sixth generation wireless transmission speed. (6G) in real time. in a laboratory environment. Further progress is occurring thanks to the industry committee of the Metaverse – China’s first official metaverse organization, a collaboration of the three major Chinese telecommunications operators – China Mobile, China Unicom and China Telecom – and in partnership with several companies. technological. Together, they plan to leverage their advantages in emerging 6G and 5G network infrastructure, cloud gaming, and virtual reality (VR) technologies to shape new metaverse developments.

Meanwhile, NetEase is developing the relevant technology needed by the industry and has entered into a strategic partnership with the Sanya Municipal Government in Hainan, China’s South Island Province, to establish a metaverse-related industrial base in the city. ByteDance has also set itself the goal of claiming the Chinese metaverse, taking its first steps by acquiring one of the leading virtual reality (VR) headset manufacturers Pico last August. Newcomers like Nreal – a Chinese startup focused on developing augmented reality (AR) glasses – and Besttone – a cloud-based games and entertainment company creating an integrated 5G XR platform – have both invested heavily in the technology. ‘space.

China’s lead in the adoption of 5G and its advancements in mobile internet infrastructure give the country a head start in creating the purely digital metaverse envisioned by Facebook – or even the more augmented, Internet-based metaverse. the reality that China prefers.