One of the biggest buzzwords in corporate circles globally, after Covid-19, is the metaverse. Very rarely has a paradigm caught on to our collective imagination as the metaverse has. There are reports of people buying property in the metaverse—Snoop Dogg just bought a plot of land on metaverse platform Sandbox. Luxury brands are selling apparel on the metaverse—there are gaming avatars sporting Gucci handbags and Valentino outfits. And companies like JP Morgan are opening a virtual lounge on Decantraland, another metaverse platform. Goldman Sachs estimates that the metaverse is likely to be an $8 trillion opportunity.
Amidst this global hype and hoopla, this article explores what the metaverse phenomenon means for the retail and consumer-centric sectors in India over the next few years.
Like most business paradigms, the metaverse use cases are likely to witness a maturity curve over some time
Multiplayer gaming on the phone or a gaming console is fairly advanced already. Throw in a few NFT tokens, a virtual digital currency for commerce, an advanced live-streaming platform for gamers, a bit of shopping in a virtual 3D atmosphere and the metaverse is much closer than you might imagine.
The other areas where the metaverse is almost there are corporate functions. There are programs where employee onboarding is moving on from PowerPoint to virtual 3D expeditions to bring the virtual onboarding experience to life. Using your digital avatars to attend meetings, giving it a real-life vibe is well beyond their pilot stages. Similarly, education in the classroom is moving towards an online, immersive experience.
In terms of the retail shopping experience, step one of the journey is going to be covered soon, while many more use cases are likely to evolve along the way.
Step one, which comprises of taking the test drive of your favourite car in a virtual environment or going shopping in a 3D mall that almost replicates your real-life shopping experience, is well underway.
More advanced use cases apply in recreation and travel. Watching the India-Pakistan match in the metaverse at the T20 World Cup later this year from the best seats at the Melbourne Cricket Ground is some distance away. Similarly, seeking an almost real-life equivalent experience of walking down the Mala Strana in Prague or attending a real-life AR Rahman musical concert in the metaverse are also some time away.
Some unconventional use cases include attending dates and weddings in the metaverse (For example, Indian dating app Mingout is currently giving it a try, and a couple recently enjoyed a romantic date in a moon-based setting).
The metaverse provides an immense opportunity for IT services, telecom and the creator economy
With the rapid expected boom in the above use cases, the metaverse is likely to provide an incredible sonic boom to various industries. Credit Suisse estimates that data consumption is likely to increase 20X in 10 years with the leading telecom players expected to rake in the moolah. Similarly, leading Indian IT service companies are likely to witness a disproportionate growth over the next few years, crafting customised solutions for various industries in the metaverse. Lastly, not to forget, a huge boom is likely to be witnessed by the creator economy as they can actively monetise their value proposition through an immersive experience of content, commerce and community.
Massive roadblocks and concerns need to be ironed out
While the metaverse sounds like a lucrative proposition in the making, there are structural impediments to its growth. Primarily, the rapid penetration of 5G services to be rolled out in India later this year, along with appropriate headsets and penetration of 6G internet for the more advanced use cases.
All of these are likely to take at least two-five years to reach a critical threshold in urban India. Besides the structural impediments, other governance concerns need to be nailed out. If cryptocurrency emerges as the primary currency for transactions in the metaverse, a government policy around it will be mandatory. Along with the currency, a framework to manage massive amounts of user data, including personal user data, will be absolutely essential. As social media has shown, unmanaged growth does more harm than good for consumers’ lives. Hence a governance framework to manage content, online bullying and the ability to maintain law and order in the virtual world will be essential for a non-toxic impact on our lives.
In conclusion, if the metaverse lives up to the hype, it is likely to be one of the most pivotal moments of our lives. How this plays out, at what speed, and the impact—positive or negative—it has on our lives, only time can tell.
Until then, you can fret over how your digital avatar will look in a corporate meeting at work.
The author is an MBA from IIM Bangalore and a strategy course holder from INSEAD. He has been a strategy consultant for over a decade. He is the author of ‘Hacks for Life and Career: A Millennial’s Guide to Making it Big’. Views are personal.
The thoughts and opinions shared here are of the author.
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