Metaverse Emerging as the Core of the Future Industry

Industries are leaping into the virtual platform metaverse market one after another.
This is due to the growing interest being shown in the metaverse by the MZ generation, the big players in the market,
and the rapid development of augmented reality and virtual reality technologies, which are the core of metaverse implementation.
Let’s take a look at the various types of metaverse expanding throughout the industry, and the future that the metaverse will bring.
Article: Editor’s Office

In July, Facebook CEO Mark Zuckerberg announced during the results announcement conference call that he would transform Facebook from a social media company to a metaverse company. Google and MS, although they did not call it the metaverse, also made huge investments every year in new business models that incorporated virtual reality and augmented reality in their platforms. This is because the metaverse is emerging as the key to future industry.

Although there is no doubt about the potential of technology and added value of the metaverse, there are no established technical standards. This is why global IT companies are competing for dominance in the metaverse. Industries are also paying attention to the metaverse, as the offline market is shrinking due to the COVID-19 pandemic. This is because, as the ‘untact’ trend has settled in, the metaverse has emerged as a new marketing tool that can connect to offline stores and induce purchases through virtual space.

Rapidly advancing with virtual reality and augmented reality

Metaverse is a compound word made up of the words “meta” meaning beyond and “universe,” meaning the world, space, etc. It first appeared in the novel “Snow Crash” in 1992 by American SF writer Neal Stephenson, as the name of a virtual space. The novel is about a man who is a pizza delivery driver during the day and a superhero by night in the virtual space, living in the online world called Metaverse. The point is the existence of a virtual world that cannot be enjoyed in the real world. However, because there was little technology to realize this at the time, the metaverse was mainly dealt with in games.

Then, the word “metaverse” appeared again in 2007. The Acceleration Studies Foundation (ASF), an American technology research organization, announced the metaverse road map, and the concept of metaverse, a fusion of reality and virtual space, became widely known. Even at that time, the technology still did not reach the level to support the high industrial value and potential of the metaverse. As advance IT technology became common, it became more and more possible.

The key value of the metaverse is in the virtual reality and augmented reality that visually realizes the virtual world. Currently, it is in the form in which the user is a virtual character in the virtual world, communicating with other users through games, gatherings, events, etc. and creating economic value; it is expanding as a concept of linking the real world and the virtual world in both directions.

The market that connects the MZ generation to existing distribution channels

The latest trend in the 3D virtual world of the metaverse has opened up an attractive market in the retail industry in particular. There are two main reasons why the distribution industry is paying close attention to the metaverse: marketing targeting the MZ generation who have become the big players of the distribution market; and it is possible to create synergy with existing channels.

The MZ Generation (comprising those who were born between the early-1980s and the early-2000s), who are the main users of the metaverse, is the largest group accounting for about 36% of the population of Seoul. It is the generation that is sensitive to new trends, and has high purchasing power. They also have experienced avatars and online characters through old platforms such as Cyworld before the metaverse, so they quickly adopted to the metaverse. The ‘untact’ trend due to COVID-19 has particularly accelerated the influx of the MZ Generation, who is familiar with the digital world, into the metaverse.

The need for a new growth window for offline distribution is another factor attracting attention. As the added value generated through the metaverse platform grew, they tried to graft it with the offline distribution channels, and the sales prove that great synergy is actually created.

Industries going into metaverse marketing

Leading the metaverse platform in Korea is ZEPETO, launched by Naver in 2018. On ZEPETO, you can engage in various community activities with other users through a 3D avatar such as games, parties, and concerts. The users make money by applying monetization models, such as producing fashion items, collaborating with famous brands or celebrities, etc. In fact, global brands such as Gucci, Nike, MLB, and Puma have entered ZEPETO, selling items cooperating with celebrities.

Lotte Home Shopping introduced ‘untact’ shopping contents that allow users to virtually experience themed camping sites through virtual reality technology before purchasing camping equipment. HIMART has also opened HIMADE Island in the Nintendo Game Animal Crossing, which was a sensation, to implement their marketing.

The convenience stores are also joining the metaverse. GS Retail is partnering with Cyworld, which can be referred to as the first-generation metaverse, to open a shopping channel inside Cyworld linked to offline shops at the end of November. CU, operated by BGF Retail, opened the CU ZEPETO Hangang Park Branch in ZEPETO for the first time in the distribution industry. The users can order CU products in ZEPETO Hangang Park Branch and drink or eat their coffee or food on the parasols or tables separately provided. CU plans to continue its marketing by connecting various online and offline services in the future, such as linking purchases with actual products.

Another company that partnered with ZEPETO is the Hyundai Motor Group, which installed a driving zone in ZEPETO and made it possible to test drive Sonata N Line vehicles. It also conducts design fairs through virtual reality headsets, breaking the custom of bringing the designers from other countries to the headquarters for design fairs when launching a new car. When group training for new employee became difficult due to COVID-19, Hyundai Mobis held an event through the metaverse platform to exchange greetings and communicate. The industries where customer experience is important, such as cosmetics or food industries are also receiving their customers in virtual reality and augmented reality platforms. There are, of course, differences from direct experience. However, they are using the platform actively as a new marketing tool or a means to lead online and offline sales, instead of pursuing customer experiences in-person.

Strategy Analytics, a global market research firm, predicts that the metaverse market size will be 300 trillion won by 2025, which is six-times the current size. The scope and potential of the metaverse is infinite. Just as the shopping trend has shifted from offline to online, the market itself will now shift from online to metaverse. There are also predictions that it will evolve to be a platform for living, and not just a platform focusing on contents. It will be interesting just to watch how much the metaverse, which is rapidly emerging as a trend and a game changer, will lead to surprising changes, offering consumers a whole new customer experience.