- “Metaverse” became the latest buzzword as Facebook announced its rebranding, but many companies have been using the term well before the social media giant.
- Commetric’s analysis found that gaming companies like Roblox and Epic Games have been among the early metaverse proponents in the media, as well as fashion houses like Gucci, Burberry and Dolce & Gabbana.
- Facebook’s attempt to control the metaverse narrative via its corporate rebranding is a clear sign that in the crowded tech industry, PR and comms are just as important as innovation.
Coined in Snow Crash, Neal Stephenson’s 1992 sci-fi novel, the term “metaverse” has become a tech buzzword this year, with companies and investors keen to be a part of the next big thing. The number of searches for the word increased more than tenfold from 2020 to 2021, while media outlets including the New York Times, Washington Post and the Guardian have all published extensive articles probing its implications.
This sudden interest is easily explained – throughout the pandemic, it became very obvious we leapfrogged five to seven years in the digital revolution, as Hans Vestberg, CEO of Verizon, said during his keynote at CES 2021 in January. And even when restrictions gradually ease, the acceleration of tech and its prominence in many lives will continue.
And of course, Facebook made headlines when it announced it would change its name to Meta, in an effort to rebrand and reflect its expansion into the metaverse. Many critics suggested that rebranding is a form of crisis management at a time when the company confronted whistleblowers, PR firestorms and Congressional inquiries. However, others argued that this transition from an initial product or service offering to a broader identity is fairly typical for large companies as they scale.
In that respect, Facebook’s rebranding may be most analogous to Google’s move to create parent company Alphabet in 2015. Similarly, Dunkin’ dropped the Donuts from its name in 2018 to signal an increased focus on coffee and other areas, and Apple dropped the Computer from its name in 2007 to reflect its moves into home devices and phones.
But Facebook’s rebranding is a bit different – it’s an attempt to capitalise on growing buzz over a concept and to basically steer the metaverse narrative. Early adopters of the concept criticised the social media giant, saying the company is essentially trying to build what many others have been building for years but rebrand it as their own. Some also suggested that Facebook changed its name to essentially secure the new trademark legally as soon as possible as more brands become interested.
Work, games and fashion
As many people will now associate the term “metaverse” with Facebook, we decided to analyse the media conversation around that concept throughout the last 12 months – a period that includes a large chunk of time when Facebook wasn’t implicated that much.
We analysed 481 English-language articles published in a set of pre-defined global publications. These comprised top mass media outlets like Reuters, the New York Times, Forbes and the Guardian.
We found that Work and education and Gaming and e-sports were the two most prominent topics in the debate, as companies focused on how their solutions will change consumers’ professional and leisure lives.
Most articles focused on how metaverses would alter the future of work and the workplace at a time when the pandemic made remote work a norm for many industries. Many journalists speculated that Zoom calls soon be replaced by hanging out with colleagues in a digital world. Even Eric Yuan, CEO of the videoconferencing app Zoom, said he believes AR and VR will play a big role in the future of work.
Another reason for the prominence of the Work and education topic was that Mark Zuckerberg revealed his bold vision for the future of work when announcing the Meta rebrand. Zuckerberg also announced the launch of Horizon Workrooms, a virtual reality workspace that lets employees mimic team meetings and socialising. According to some analysts, Facebook’s focus on work comes as the social media company has lagged behind competitors like Microsoft and Google in luring the workforce.
Gaming and e-sports emerged as a major topic as the most accessible entry point into the metaverse so far has been predominantly through multiplayer video games. Gamers also use the word “metaverse” to describe gaming worlds, in which users have a character that can walk around and interact with other players.
Some commentators even said they no longer distinguish between social and gaming platforms because multiverse games have a prominent social aspect. In fact, two-thirds of UK adults played games with friends and family to stay in touch during lockdowns, according to a May 2021 survey from Xbox.
And when a digital version of a Gucci bag sold in May for more than US$4,100 ― more than the physical version would have cost – many journalists started writing about the rise of digital fashion. According to IBM’s 2020 US Retail Index, the pandemic has accelerated the shift away from physical stores to digital shopping by approximately five years. The world’s biggest fashion companies have also experimented with making virtual clothing, which people’s avatars can wear in metaverse environments.
Using a metaverse solution to watch a concert or a show has been seen as a logical development, as the coronavirus forced many artists to play virtual concerts in lieu of their live on-stage performances. For example, in September millions of people watched the singer Ariana Grande virtually perform on Epic Games‘ platform.
Meanwhile, real estate, architecture and design are also booming in the virtual marketplace. For instance, Hrish Lotlikar, co-founder and chief executive officer of SuperWorld, an augmented reality virtual world, said the company had sold “thousands of properties” already in 2021, with users spending, on average, around US$2,000 on the virtual real estate platform.
Virtual reality also allows us to explore new places without physically travelling there, leading some to speculate whether virtual travel could ever replace the real thing. Many see the value in being able to explore parts of the world virtually because visitors can check out destinations before they decide whether to travel there in real life, as well as experience destinations that are difficult to get to.
Meta beyond Facebook
Some compared thе noise around “metaverse” with the auto industry in 1905 with hundreds or thousands of companies coming at it with all sorts of solutions. Although Facebook’s rebrand put it in a leading position, most analysts agreed that it is unclear whether one dominant metaverse will emerge or whether multiple companies’ metaverses will exist in competition.
We used Commetric’s proprietary ‘media conversation impact score‘ metric to identify the organisations with the biggest impact on the media discussion.
We determine an organisation’s media impact in the context of a topic by looking at its media influence score calculated in terms of coverage by high-profile media outlets, topic relevancy score measuring its contextual relevance, and media visibility as measured by the number of mentions.
Naturally, Facebook’s impact is disproportionately large thanks to all the headlines during the last couple of weeks:
Facebook was followed by Microsoft, as many reports suggested that Microsoft and Meta will clearly compete heavily in the metaverse era.
Microsoft entered the race to build a metaverse inside Teams, just days after Facebook rebranded to Meta. Microsoft’s strategy was to bring Mesh, a collaborative platform for virtual experiences, directly into Microsoft Teams as part of a big effort to combine the company’s mixed reality and HoloLens work with meetings and video calls that anyone can participate in thanks to animated avatars.
Although this announcement came soon after Facebook’s, many journalists pointed out that Microsoft has spent years investing in the metaverse, with its HoloLens work and its acquisition of AltspaceVR.
Roblox is another company that was early to this concept. On average more than 36 million young people come to Roblox to play, learn, and interact in a 3D virtual space. In March, the company went public and made headlines because it ended its first trading session with a $38 billion market cap.
According to many commentators, the reason why a money-losing company that makes video games for children attracted such a lofty valuation is that the long-term goal for Roblox is to build a metaverse where millions can gather to take part in games, meetings, collaborative work and even Roblox’s own virtual economy fueled by its currency called Robux.
And anyone whose virtual alter ego is wandering around the Roblox online game platform these days might run into other avatars sporting Gucci handbags, sunglasses or hats. The digital-only items were part of a limited Gucci collection for Roblox, a step by the fashion house that prides itself on Italian craftsmanship to enter an expanding virtual space where many of its youngest admirers already are at home.
Players in the metaverse say the big-name fashion collaboration represents a new era of virtual-real world interplay, a space in which smart product placement meets the desire of consumers to express their personalities in the virtual world. While the Gucci Garden space on Roblox was open for two weeks last month, the platform’s 42 million users could spend from $1.20 to $9 on collectable and limited-edition Gucci accessories, with one particular bag being resold for over US$4,100 worth of Robux.
Meanwhile, LVMH-owned Louis Vuitton launched a metaverse game where players can collect NFTs, or nonfungible tokens, and Burberry has created branded NFT accessories for Blankos Block Party, a game owned by Mythical Games. In addition, Dolce & Gabbana announced it had sold at auction a nine-piece collection of digital NFTs, alongside some actual couture for a total of 1,885.719 Ether (Ethereum cryptocurrency), or the equivalent of nearly $5.7 million.
Apart from Roblox, another influential gaming company exploring the metaverse was Epic Games, the company behind the popular shooting game Fortnite. It’s already dabbled with experiences outside its core shooting game by hosting a Travis Scott concert and the premiere of a clip from the last Star Wars movie within the Fortnite world, for example.
According to some, Epic Games is already winning the metaverse race as it has already normalised that idea within its youngest players and the Fortnite multiplayer game is essentially a proving ground for the metaverse concept. It’s a massively social space that’s grown well beyond its battle royale roots at this point: players have gathered to watch concerts, movies, and more in the game.
Another tech company early to the metaverse market was Nvidia, which in April announced its Omniverse, a virtual environment the company describes as a “metaverse” for engineers. The company said it imagines engineers, designers and even autonomous machines connecting to Omniverse to create digital twins and industrial metaverses.
Other tech firms including Google, Apple and Snapchat featured in the debate as they have raced to develop various smart glasses products. In the meantime, journalists also paid attention to China’s tech giants that have also been working on the futuristic concept. For instance, gaming giant Tencent is set to sharpen focus on developments in the metaverse space with a new gaming studio under subsidiary TiMi Studios, while TikTok owner ByteDance is also seen to be taking steps into the space with the acquisition of VR startup Pico Interactive.
Of course, Mark Zuckerberg was the most often cited spokesperson in the metaverse conversation, alongside other Facebook representatives like Head of Facebook Reality Labs Andrew Bosworth, Vice President of Global Affairs Nick Clegg and Vice President of Central Products Javier Olivan.
However, representatives of rival companies were also among the most influential voices in the media discussion:
Epic Games CEO Tim Sweeney, who followed Zuckerberg in terms of influence, has been incredibly vocal about wanting to build a version of the metaverse for years. After receiving new funding in April, Sweeney said that he’s grateful to investors “who support our visions for Epic and the Metaverse” and its work with “connected social experiences.”
To Sweeney, people are tired of how today’s Internet operates. He says the social media era of the Internet, a charge led by Mark Zuckerberg’s Facebook, has separated commerce from the general audience, herding users together and directing them to targets of the company’s choosing rather than allowing free exploration.
Matthew Ball, a partner at the venture fund Epyllion Industries and a prominent metaverse hawk, described the metaverse as a grand, unified pool of persistent 3D spaces that users navigate as embodied individuals, not just web browser sessions. Crucially, he said, it must have a “fully-functioning economy”, be filled with content created by its users and allow data and digital items to be freely ported across its breadth instead of trapped in Apple-style walled gardens. “The full vision remains seemingly fantastical and decades away,” Ball said in January, “[but it] has become the newest macro-goal for many of the world’s tech giants.”
Roblox CEO Dave Baszucki also has dreamed about the metaverse for a long time, saying that he thinks of his company as the shepherd of this idea. He added that his hope is the metaverse doesn’t just look like reality but also feels like reality so that the cars in the metaverse have engines and they have axles and wheels: “When the wheel falls off the car, the car does what we would expect in real life.”
Singapore-based investor Vignesh Sundaresan, who calls himself Metakovan, made headlines when he bought the digital artwork “Everydays: The First 5000 Days” by the American artist Mike Winkelmann for $69.3 million, making it the most expensive NFT and among the most expensive works by a living artist. Sundaresan plans to put the artwork on display in four virtual world environments. He is working with architects to design gallery complexes that the public can enter via web browsers or virtual reality technology.
And Winkelmann himself is working on a start-up called Wenew, which will sell NFTs associated with moments in time, creating, in the company’s words, “the memory palace of the metaverse.” Its early offerings include moments from the tennis star Andy Murray‘s career.
As we mentioned, it’s still unclear whether one dominant metaverse will emerge or whether multiple companies’ metaverses will exist in competition. But will Facebook completely control the story in the near future? Not necessarily, if other companies play their PR cards right. Here are a few takeaways based on our analysis:
- PR and comms are just as important as innovation. Facebook’s attempt to control the metaverse narrative via its corporate rebranding is a clear sign that in the crowded tech industry, PR and comms are just as important as innovation. Many brands have tried to become synonymous with certain concepts but Facebook took it one step further and became literally eponymous with the metaverse by changing its corporate brand to Meta. In this way, early adopters of the concept can seem like followers. However, if a company’s product is popular enough, it risks something called genericisation, which is when the public associates the brand name with the generic class of product itself. Take the word Aspirin, for example, which was Bayer‘s brand name drug but is now used for any drug treating pain and reducing fever. In tech, Google‘s rise to search-engine dominance led to its name turning into a verb: Today, people use “google” to mean to look up on the internet.
- Differentiation will become essential. In the crowded technology industry, competitive differentiation is one of the most difficult tasks. Successful product differentiation involves communicating the unique qualities of a product or company while highlighting the distinct differences between that product and its competitors. Doing this early is essential as the metaverse now is mostly a marketing hype designed to show that a company is on the cutting edge and has future technology in mind – it’s just like a few years ago when every tech company was hyping its artificial intelligence prowess. In fact, some observers suggested that too many vendors are metaverse-washing. Differentiation would be even more pertinent for companies that don’t want to be associated with Facebook and its troubled reputation.
- Trust should be a bigger priority. People are concerned about the pace of technology being too fast, with the likes of AI, gene editing, cryptocurrency and personalised medicine emerging as complex concepts and being developed with speed. It is vital that tech maintains its trust for years to come by delivering on its promises, operating with integrity, and having a positive impact on society. This involves the ‘doing’ and also communicating these actions because engagement with end customers and the general public is integral for the sector to flourish. According to Edelman, the technology sector also has the power in its hands to tackle the very issues that have caused critics to point their fingers at technology in recent years. For example, organisations can codify trust by baking fairness and explainability into their algorithms so that people can easily see the workings of the decisions made about them and challenge them if they need to. Also, by putting the privacy and human rights of the public at the top of the priority list, people will start to see tech firms as friends, rather than foes.
- Younger generations are the real decision-makers. The path to the metaverse goes through younger generations, and that is going to be Meta’s Achilles heel. Companies like Epic Games have already normalised the metaverse concept for its youngest players, and, more importantly, made the whole idea look cool. Facebook, on the other hand, is losing its coolness factor: its struggle to attract users under the age of 30 has been ongoing for years, dating back to as early as 2012. But the problem has grown more severe recently. Teenage users of the Facebook app in the US had declined by 13% since 2019 and were projected to drop 45% over the next two years, driving an overall decline in daily users in the company’s most lucrative ad market. For some, the Meta rebrand was a glimpse into Mark Zuckerberg’s fear that Facebook might shrivel into irrelevance. Some companies in our research sample already have giant audiences that are primed and ready for the future. Meta is late to a marathon it is claiming just began and will need to run twice as fast to catch up.