It's absolutely vital to the success of any business to be near its customers, but for retailers, this statement is doubly true. People put up all kinds of barriers to purchases, so there becomes a sort of silent arms race between potential customers and modern retailers who are trying to reduce the friction.
Understanding this is vital to understanding why retailers like Walmart and Samsung are investing big bucks in metaverse real estate and working to develop a whole new sort of commerce. Metacommerce, for lack of a better term, has huge potential for growth in a virtual realm that's still trying to figure out what it's going to be. So, of course, retailers are headed to the hottest digital frontier.
There are many reasons this actually makes sense -- here are just a few.
Image source: Getty Images.
1. Gen Z has grown up with metaverse-like economies
Walmart and Molson Coors' Miller Lite aren't building branded adventure games and virtual stores that sell real world goods in the metaverse to capture the attention of boomers or even millennials.They're there because a new generation is maturing into adults: Gen Z, those born between 1997 and 2012. If millennials were the first "digital native" generation, it's possible that Gen Z is the first "metaverse native" generation. They've been spending their time on platforms like Microsoft's Minecraft since 2011, and even though it's not universally considered a part of the metaverse, this sandbox game and others like it share many common elements with metaverse worlds.
Retailers have learned they have to go where their customers are, rather than wait for them to come a-knockin'. They eventually -- in some cases, too late -- came around to e-commerce and social-media marketing. This time, retailers are making the pivot faster in hopes of avoiding being behind their competition when it comes to the next type of shopping experience. Metacommerce is coming because this is how retailers can reach Gen Z most efficiently.
2. Retailers have a chance to create something interesting
Big box stores may be efficient in a real-world kind of way, but they're hardly sexy and very rarely inspire people to do much of anything creative. Big box stores are for buying oranges and underpants under one roof, not for making memories and having experiences.
The magic of the mall doesn't exist in the real world anymore, but metaverse retailers can reimagine those experiences for generations that never knew the allure of an arcade and a food court. The metaverse gives retailers a chance to recreate the kind of synergy that made malls so popular at one time, including offering unique limited-time events and products found nowhere else.
For a fraction of the cost of a real-world mall, metaverse commercial districts in platforms like Decentraland and The Sandbox have the potential to become go-to social and shopping hubs for Gen Z (and for those of us with fond memories of hanging at the mall).
3. Meta-retailers require low daily input but can return big rewards
From a business perspective, a set it and forget it kind of operation is pretty ideal. You pop in now and again to make sure nothing's broken, collect the money from the till, and be on your way. What could be easier? In the metaverse, there's real potential to create automated stores that from a human-resources angle basically operate like vending machines.
Once the designers and programmers are out of the way, those metaverse retail locations can be run by helpful bots that don't need benefits, pay, or even lunch breaks. Expanding a retailer's reach without expanding the permanent workforce is one of capitalism's ultimate dreams -- and it's possible for meta-retail.
Unlike e-commerce, which is cold and impersonal, more like ordering from a catalog, meta-retail can be warm, if not automated, depending on the programming of the sales bots.
Retailers are seeing the value and power of the metaverse
It's an interesting time to be either a real estate investor or someone who invests in retailers. Real estate investors have a chance to get ahead of retailers interested in having a metaverse presence but maybe not quite ready to commit to owning their own property (or who don't even own real-world real estate and rely on renting retail space).
For investors in retail businesses, if your companies are branching out into the metaverse, they're breaking new ground and stand on the cusp of a new evolution of shopping. Meta-retail absolutely will change the game as much as e-commerce has.
In this pandemic world, many people are still finding it difficult to have the kind of life they want due to disease risk and other dangers, but the metaverse opens up all kinds of potential. Metaverse malls? Why not? Why not follow the lead of brands like Samsung that are already in the space and use the metaverse to create the kinds of retail experiences that are either too expensive or physically impossible to have in the real world?
