The benefits outweigh the risks when it comes to the adoption of Metaverse for small businesses.
The Metaverse has been become one of the biggest buzzwords in the blockchain and crypto, as it promises to provide a more immersive, interactive and collaborative experience than what the internet has accomplished to date.
This promise of a new world has huge enterprises like Meta (formally known as Facebook) investing huge sums in the budding space. When most hear the name Metaverse, their mind wanders to a few things: an avenue for global conglomerates to showcase their technology-forward bent, an esoteric product for a selected few to display nonfungible tokens (NFTs) or a new front in gaming development. However, a deep dive into Metaverse reveals a whole new world, a world full of new opportunities and risks for both consumers and businesses.
Although the current Metaverse ecosystem might be populated with giant corporations, eventually, for wider adoption, small businesses will have to make a transition. Looking at historical patterns in the adoption of new technology like the internet, mobile payments and more, it is apparent that small businesses play a monumental role in getting the masses onboarded.
One of the critical insights from Facebook’s Connect 2021 was that the advent of Metaverse is imminent, but the timeline for widespread adoption is spread out at least over a decade. A study done by Pew Research found that around 54% of top technology innovators, developers and businesses. Meanwhile, policy leaders believe that by 2040, the Metaverse will be a functioning aspect of daily life for a half-billion or more people globally.
The urgency for transitioning to Metaverse may not be immediate, but businesses should be considering the technology at least in the periphery. By strategically using resources now, an enterprise will be able to improve the experience for customers of the future.
To understand what opportunities and risks Metaverse brings to a business, it is imperative to understand the infrastructure of Metaverse. Jon Radoff, CEO of 3D gaming company Beamable, categorized in seven layers:
In all probability, most small businesses will be involved in bringing Metaverse experiences to their customers. Talking to Cointelegraph about the disruptive potential of Metaverse, Naveen Singh, co-founder and CEO of decentralized data management network Inery, said:
“It is no longer a question that the Metaverse would be a major disruption for the digital economy. The real focus now is for which industries the Metaverse would be the most significant. As a gateway for a new digital economy, the Metaverse opens new possibilities for several domains.”
“The industries that are most likely to undergo transformation and feel the immediate impact of the Metaverse are gaming, fashion, entertainment, media and retail. At the same time, for the Metaverse to unleash its full potential one of the most defining properties would be interoperability across its fabric,” he said.
The gaming industry has traditionally been a trailblazer in adopting cutting-edge technologies, and it’s the same case for the Metaverse. Many gamers already consider Metaverse to be the next frontier in gaming. Developers say today’s gaming can often feel lonely. Although multiplayer gaming solves the problem of isolation to an extent, Metaverse takes immersion and community to a whole new level. Communities created by Metaverse projects like Decentraland, Axie Infinity and Sandbox give not only social benefits but also monetary ones.
However, the current Metaverse gaming space is dominated by large firms. The research and development for a Metaverse game are generally out of budget for small businesses. Nikita Sachdev, the founder and CEO of Luna PR, thinks that along with gaming, real estate is another sector that could potentially be an earlier adopter of the Metaverse. Sachdev told Cointelegraph:
“For real estate, companies and agencies are always looking to develop ways of touring and visualizing properties for pre-plan sales and foreign investors. Imagine if you can tour an entire compound before it is even developed? Investing in real-world property will become a lot more immersive and ‘open houses’ will not be necessary anymore.”
The global real estate market is estimated to be valued at over $3 trillion, and any potential dent in this space can have immense economic and sociological implications.
Fashion is another sector that could be disrupted by the Metaverse. In fact, there has already been a successful Metaverse Fashion Week which included runway shows, after-parties, immersive experiences, shopping, panel talks and more.
Wahid Chammas, the co-founder of Faith Tribe — an open-source design platform — believes that since the Metaverse and fashion are ultimately about identity, they are bound to complement each other. Speaking to Cointelegraph, he said:
“People venture into the Metaverse and do all kinds of things to live and portray an identity that they may not be living in the physical realm. Wearables are undoubtedly the most conducive to showcasing your personality and identity. Having this link between physical and digital accentuates your perceived identity, we believe there will be further disruption of both the physical and the Metaverse worlds of fashion for brands that take digital fashion seriously.”
Exposure to Metaverse can have a higher risk for small businesses. The ecosystem is still taking shape and the uncertain and nascent character of Metaverse could lead some businesses’ roadmap astray. Expounding on this point, Jake Fraser, head of business development at Mogul Productions, told Cointelegraph:
“Technical expertise and knowing how to structure environments for users virtually is a fluid space and requires people to have their finger on the pulse to execute the best user experience. There also needs to be value for the user and something unique that they can’t get from your brand in another place. If there is no clear ‘hook,’ it can be difficult to drive adoption from businesses.”
However, it is evident that venturing into the Metaverse for relevant companies not only helps businesses to be ready for the future but also makes their present offerings more lucrative. The benefits far outweigh the risks. George Narita, CEO of Aurora42, told Cointelegraph:
“The most significant risk is not getting into the metaverse world. I see a lot of opportunities, especially for early adopters, the same way it was at the beginning of the dotcom era; many didn't understand how to communicate. Just being in the Metaverse is not enough. Those who have a disruptive vision and provide experiences and emotional connections by co-creating with their followers will be ahead. Today, people do not want to be passive but to be part of the construction of this universe.”