The metaverse sounds like something from a comic book. But what is it, and why is everyone talking about it?

Today, we experience the internet through the flat screens of our phones, tablets and laptops. We watch the internet, but we’re not immersed in it.

Now imagine a virtual world, where you have your own avatar. You can hang out with friends and do nearly everything you’d do in daily life. Play games, go to events, or go shopping. It’s a whole world existing in parallel to the real world.

This is the metaverse.

We aren’t in a true metaverse yet, but different ways to experience pieces of the metaverse are already available. Some of it is accessible using your existing devices, with the help of augmented reality (AR) technology. AR blends the real and virtual worlds, either by using AR goggles that change what you see, or by altering what you see on the screen of your phone or tablet. Some of it uses virtual reality (VR) headsets to fully immerse you in the digital world. Some advanced platforms even feature sensors that translate your real-world gestures to your virtual world avatar.

Anyone who’s played Pokemon Go has seen AR in action. Some people have already encountered this technology while shopping. Several online stores now let customers use AR to explore products before they buy, such as Warby Parker. Their customers can use AR to try on glasses from the comfort of their own homes, so they can pick out the perfect frames.

58.9 million Americans experienced virtual reality using a VR device at least once a month in 2021.

Some companies are betting big that these kinds of immersive experiences are the future of the Internet. In fact, 58.9 million Americans report using a VR device at least once a month this year. That’s up by 16 million from 2019.

Why Is Everyone Talking About The Metaverse?

The metaverse is the hot topic of water cooler gossip due to Facebook’s announcement that they’re rebranding as a metaverse company, named Meta. Mark Zuckerberg said that the metaverse is the “future of the mobile internet.” A blend of AR and VR technology will, he says, let us “feel present – like we’re right there with people no matter how far apart we actually are”.

Facebook isn’t the only one with its eyes on the metaverse. Epic Games has invested $1B in metaverse research and development. Meanwhile, Nvidia and Microsoft are both pushing the boundaries of software and hardware in their quests to build metaverse technologies.

Nvidia already has its own platform - Omniverse - for creating virtual spaces, and plans to continue expanding. Nvidia made headlines recently when its CEO, Jansen Huang, delivered a keynote speech beamed directly from his kitchen. Or so it seemed. It transpired that the company had used a digital clone of Huang, in front of a virtual recreation of his kitchen.

Major tech companies are pushing the boundaries, investing billions in R&D to make the metaverse a reality.

These companies are putting a lot of effort into making the metaverse a reality. And the technology is already more popular than you might think. It’s estimated that this year 17.7% of the US population will use VR at least once a month. And 28.1% will use AR.

What Does the Metaverse Look Like Today?

The idea of the metaverse isn’t new. You can see elements of it in several popular platforms:

  • Second Life: Launched in 2003, Second Life is a virtual world with its own cities and economy, targeted at people aged 16 and over. Linden Lab, creators of Second Life, estimates the site has 900,000 active monthly users.
  • Roblox: Launched in 2006, Roblox lets users create and play games. It’s got its own currency and economy. Its target users are mostly children.
  • Minecraft: Launched in 2011, Minecraft is primarily targeted towards younger audiences (aged 5 - 15.) It offers an open world sandbox environment that encourages creativity and allows an endless amount of game play. Its low tech requirements mean users don’t need the latest gadgets to play, which has contributed to its success.
  • Fortnite: Launched in 2017 as a free game, Fortnite now hosts entire virtual events with millions of participants. In April 2021 alone, Fortnite players spent over 3.2 billion hours in-game.
  • Horizon Workrooms: Launched in 2021, Horizon Workrooms is a virtual office space from Facebook. Colleagues can hold meetings, work on whiteboards together, etc. Horizon Workrooms also has a dial-in option so that team members without VR devices can still show up on a screen in the virtual world.

In April 2021 alone, Fortnite players spent over 3.2 billion hours in-game.

The metaverse as a single connected world doesn’t exist yet. But as younger generations spend more time and money in these virtual worlds, companies are more likely to invest in them.

What Could The Metaverse Look Like In The Future?

The internet isn’t owned by a single entity. Every website is its own little island. Internet users travel between the different islands of social media, banking, news, online collaboration, and more.

The goal of the metaverse is to create a similar experience, but all based in a virtual world. Instead of finishing a meeting using Microsoft Mesh, then logging off and logging in to Second Life to hang out with friends, users could experience everything within the same virtual world. You could collaborate with colleagues in one part of the metaverse, then swing by a virtual showroom and check out the interior of a new car. There could also be the potential to create your own experiences. The metaverse would be yours to explore and create in.

People are already primed for spending real money in virtual worlds.

You could even participate in a virtual economy. You might buy virtual real estate or collect digital items in the form of non-fungible tokens (NFT). Virtual shopping experiences are already familiar to anyone who's played a game that features digital currency. Oftentimes, digital currency is purchased using real world money. From the current virtual games and platforms, people are already primed for spending real money in virtual worlds.

The internet is built on open standards and technologies. Anyone can make a website. For the metaverse to work, it will also need to be built on open standards and technologies, so businesses have control of what they create.

We already know that customers favor omnichannel support. Businesses with omnichannel engagement strategies retain an average 89% of their customers. Customers love to be able to move seamlessly from brick and mortar stores to online ordering to social media to email. A good metaverse customer experience will be one where your customers can move easily between your business and other parts of the metaverse.

Businesses with omnichannel engagement strategies have a high average customer retention rate of 89%.

Customer satisfaction is also a must. 55% of VR users already report being moderately to extremely satisfied with the experience. But companies don’t want only half of their customers satisfied, so ensuring positive customer experience in the metaverse will be vital.

What Would A Metaverse Customer Experience Mean For Businesses?

We don’t have an open and connected metaverse yet. But the success of services like Fortnite and Roblox with a younger audience is paving the way for more virtual worlds with their own economies.

Imagine your customers entering the metaverse. They could take your products for a digital test run, try out different options, or chat with your support team. Instead of writing a wordy email, your support staff could use holograms to show customers how to do something.

Instead of writing a wordy email, you could use holograms to show customers how to do something in the metaverse.

We’re talking about an immersive experience that engages customers’ full attention. One study showed that the amount of information stored in the memory is 70% higher when using AR, than when not. That could mean a much bigger impact for your brand.

Virtual reality can even help businesses offer customer experiences in the metaverse that they couldn’t offer in the real world.

A furniture store like Ikea could let you design your space by placing different items in a virtual version of your home, and moving them around. Customers could see at a glance whether that countertop matches their color scheme, or whether that dishwasher fits in that space.

A shoe brand might set up a virtual store where customers could see the shoes in 3D without traveling to a brick and mortar store. A clothing store could create a virtual changing room where customers can view each outfit on a digital avatar that matches their body type.

Early research already shows VR and AR can impact the bottom line. Cosmetics brand We Make-Up saw a 53% higher click-through rate when they ran AR ads that let customers virtually try on different lipstick shades. Another report showed that 71% of customers would shop more often if they could use AR.

71% of customers say that they would shop more often if they could use augmented reality (AR).

The Metaverse For Team Collaboration

The metaverse could help with team collaboration, too. Microsoft is already making huge strides in this area with tools like Microsoft Mesh with Hololens. It enables 3D immersive interactions with others by providing an augmented reality overlay in the real world. Users can even project lifelike holograms of themselves into the physical world, if both people have a headset.

Your staff could meet with each other for brainstorming or troubleshooting. Staff members could create 3D objects or diagrams overlaid on the physical world, so that people in different locations can see them.

Companies in highly technical fields such as manufacturing, medical sciences and engineering could provide training at any distance. The trainer would be able to watch the trainee in real time and correct any mistakes.

The time is ripe for these kinds of changes. Remote working during the pandemic has altered the way a lot of us view work. We’re realizing that working from home saves time and energy lost in the commute. In fact, companies expect 40% of employees will use a remote working model in the future.

Companies expect 40% of employees will use a remote working model in the future.

But working at home can be isolating. Staff miss out on the human interaction and camaraderie they get from sharing an office. Lack of brainstorming opportunities can impact creativity.

The metaverse can help us have the best of both worlds. Your team could work from home, but still collaborate with each other in virtual space.

Challenges That Metaverse Needs to Overcome

With big names like Microsoft and Facebook already investing in VR, it’s clear that the race to be the first company to create a true metaverse has already begun. But there are some challenges to overcome before a unified metaverse customer experience becomes the norm.

The problem is, when a single company “owns” a VR space, they have strong motivation to keep their walled garden to themselves. They get to keep all the profits.

It remains to be seen whether these tech giants will fight for popularity and user count in the virtual world. Or will they realize that to create a true metaverse, they’ll need to be open to interconnecting their worlds, so people can roam freely between them?

It is likely that the tech giants will end up fighting for popularity and user count in the virtual world.

Does the metaverse truly have the potential to become the new internet? Not if all it offers is a “cool” place to hang out with others. The most popular existing virtual economies are games like Fortnite and Minecraft. Because they’re gaming worlds, players have to create and build in them in order to survive. There’s a sense of purpose. Users can spend hours playing, creating, and existing in their virtual worlds. The community was already formed before players started using the space to swap and sell things they’d made in-game.

Games like Minecraft give players full autonomy in the world they create. You can make it public, or only invite friends. You control the ground rules. You make one upfront payment, then you’re in charge.

A business-based VR experience probably won’t offer such rich opportunities. Their incentive will be to focus on shareholder profits and creating experiences to maximize those. Companies will likely try to control what users can and cannot do. If this happens, the experiences offered by these worlds could be very limiting compared to game-based services like Second Life. We doubt such a world would be attractive enough to gather the numbers of consumers needed to replace today’s internet!

There’s also the issue of equipment. Many immersive experiences use VR or AR goggles such as Oculus or Hololens. They’re heavy and bulky, and wearing them strapped to your face for more than a couple of hours is not practical. Price is a consideration too, with 54% of users of high-end VR devices citing cost as the most important issue VR tech is facing right now. We might be waiting a while before VR and AR goggles become more lightweight and affordable for everyday use.

It’s also going to take a while before people are comfortable interacting with businesses in the virtual world. There are still some important concerns around legal aspects, including security and privacy, that must be answered. Privacy and data security are the top legal risks about AR and VR for 49% of companies.

54% of consumers say cost of high-end devices as the most important issue with using AR or VR technology.

Finally, there’s the question of monetization. Even if a service is free to use upfront, the corporation behind it could choose to monetize in a way users don’t appreciate. For example, offering a better experience to paid subscribers or something even worse,like selling their information to advertising partners.

Takeaways

Richard Kerris, an executive at Nvidia believes “You might not think you’ll be in the metaverse, but I promise in the next five years all of us will be in one way or another.”

That might be a little optimistic. A single interconnected metaverse is more likely still decades away. But with companies like Epic Games, Microsoft and Facebook putting their resources behind creating a metaverse of their own, virtual worlds could be a big part of our future.

A single interconnected metaverse is more likely still decades away.

With so many young people engaged in virtual reality games like Minecraft, Fortnite and Roblox, the next generation will be much more comfortable with virtual worlds. They may even want their favorite brands to meet them there. And it’s not just the youngsters, either. Research shows that about half of Baby Boomers are interested in VR, and 64% feel positively about it.

If the metaverse becomes a reality, businesses that already have plans in place to provide a metaverse customer experience will have an upper hand. With 82% of companies who try AR and VR reporting that the benefits met or exceeded expectations, businesses are clearly becoming more open to the metaverse.

Today, it’s normal for customers to communicate with their favorite brands on Facebook Messenger. In the future, Facebook might bring customer experiences into the metaverse, via a virtual world where their 2.8 billion users can hang out in real time. And Facebook is unlikely to be the only company creating their own virtual world.

82% of companies who try AR and VR noticed that the benefits met or exceeded expectations.

How much people will embrace these worlds remains to be seen. We don’t foresee the metaverse being ready to take over all business activities any time soon. But it could become one of many channels customers can use to interact with businesses.

The bottom line is this: We don’t know exactly how and when the metaverse will arrive, but it’s definitely on the way. Even if we don’t know quite what it will look like yet. And if your customers decide to go into the metaverse, it would be smart for you to be there ready to engage with them.