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Make no mistake: the metaverse is big business. According to one industry estimate, it could be worth $800bn by 2024; by another, it will grow to $5tn by 2030. With such projections whetting commercial appetites, an increasing number of businesses are looking to establish a brand presence in the metaverse and are starting to integrate it into their operational infrastructure.
Yet there remains a great deal of confusion about exactly what the metaverse is, what it might become, and how businesses should approach it to give themselves the best chance of capturing a share of that potential value. If the metaverse is the next big wave, some CEOs will feel that they need to get in the water early or risk missing out.
Amid all the promotional noise, it can be difficult for leaders to discern the true developmental status of the metaverse and to assess the benefits of engaging with it. It is possible to cut through some of the confusion and grasp the key aspects of the debate. Having done so, CEOs may find that they will, in fact, be better served by resisting the temptation to set out a metaverse strategy early.
One of the fundamental problems of any discussion of the metaverse today is that different people mean very different things when they refer to âthe metaverseâ. The divergence comes as a result of the different perceptions (and aspirations) held by individuals and corporations in terms of what the metaverse could become in the years ahead.
At times, it looks like the metaverse is being shaped for, and by, gamers â through Roblox, Decentraland, Fortnite, or any of the other popular platforms. For CEOs, while there might be some value for fashion brands in making an appearance on these platforms, this suggests a limited relevance for business.
Interpretations abound. McKinsey characterizes the metaverse as âan evolution of todayâs internetâ â a sort of âinternet-plus.â This definition at least has the merit of accessibility and comprehensibility, given the ubiquity of the internet today.
For now, most CEOs should put the idea of developing a metaverse strategy on the back burner.
But there are alternative views. One of the best-known metaverse thinkers, Matthew Ball, argues that the metaverse âwill revolutionize everythingâ. In Ballâs view, âThe Metaverse is a massively scaled and interoperable network of real-time rendered 3D virtual worlds and environments which can be experienced synchronously and persistently by an effectively unlimited number of users with an individual sense of presence, and with continuity of data, such as identity, history, entitlements, objects, communications, and payments.â His analysis is highly detailed and comprehensive â for many executives, too detailed. Where would a business begin to engage with such a complex, polymorphous beast?
Another dimension of the confusion facing CEOs is the question of whether accessing the metaverse requires a particular type of device. Listen to Mark Zuckerberg and you might be led to believe that nobody will be using the metaverse without a virtual reality (VR) Oculus device. Many will be skeptical about the general level of enthusiasm for such a cumbersome user interface.
Ambiguity surrounding what the nature of the metaverse and how we will access it, is entirely typical of a significant new technology. When the internet first emerged, it was known as the âinformation super-highway.â Nobody was thinking about pictures, video, or other forms of user interaction. The same pattern is evident in the evolution of AI, which has developed from a rules-based tool, to become a much more sophisticated product of machine learning. As technologies evolve, it is correct that our definitions of them should also develop.
Today, as CEOs attempt to encapsulate the metaverse for their businesses, a simple, practical definition is possible:
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The metaverse is a virtual world in which we experience 3D renditions of people, products, and places.
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That definition incorporates the key facets of the models emerging across different platforms, and the uses to which businesses are putting these technologies. A key to the metaverse is the visual perception of having entered a different space â it feels like you are inside a new world. This might include, but is not limited to, appearing via an avatar. Consider the example of a surgeon. They might use metaverse software to model a patientâs brain, going âinsideâ their head to see things that would be impossible to discern from scans. While they would not employ an avatar, they would still have a sense of immersion. In the industrial world, the metaverse will be dominated by digital twins, which users can experience in extended reality.
What, then, should CEOs keep front of mind as they consider the different potential paths for the evolution of the metaverse, and how to position their organizations to take advantage? Many will feel the need to define a comprehensive strategy, but this could be precisely the wrong approach. For now, most CEOs should put the idea of developing a metaverse strategy on the back burner.
Setting out to develop a metaverse strategy inherently lends a technical bias to your thinking, making it all too easy to be lured down the rabbit hole of technical debates such as the relative merits of VR, augmented reality (AR), or mixed reality (MR).
A more productive approach may be to stay focused on your business needs â whether attracting new customers, improving operational efficiency, rapid prototyping of products, improving customer experience to boost retention, or something else. Then, consult relevant experts about the potential range of solutions, which may or may not involve the metaverse. Only after you have identified the appropriate solution for your business should you turn your attention to the technical ramifications.
Consider the analogy of forming a business community. There are many valid reasons for doing so, such as obtaining feedback, gaining advocates, and supporting product or service development. Some businesses can assemble a community in the physical world relatively easily â but not all. Restaurants, for example, might find it straightforward to attract a sufficient number of âfoodiesâ near their real-world sites, while a motorcycle manufacturer might have a smaller, more widely distributed customer base, to which it is more difficult to reach out. The appropriate starting point, therefore, is to consider what would be needed, across all technologies, to build a community for your particular business. The metaverse might be the answer you arrive at â equally, it might not.
For similar reasons, many CEOs should be wary of appointing chief metaverse officers. Some companies have already taken that step, which could be right for them just as having a chief digital officer works well for many companies. But, in the very early stages of a new technology, there is a risk that time is wasted on activities that exist simply to justify the appointment. A dedicated resource is useful only as long as it is working to solve real business problems and they are not âa hammer looking for a nail.â
The desire for CEOs to develop a metaverse strategy is entirely understandable. The lure of the metaverse is irresistible: who would turn their back on a market potentially worth 10tn? But, for many, this is simply not the time to go âall inâ on unproven technologies still in their infancy.
In the meantime, many CEOs would be best advised to ensure their organizations follow a simple, limited definition of the metaverse and engage in a measured fashion with these new virtual worlds, based on a clear-eyed analysis of the business problems they are seeking to solve.
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