There may be no consumer technology prospect driving more discussion and investment right now than the metaverse, and for good reason. The metaverse — essentially a parallel reality consisting of connected and interoperable worlds, brought to life by technologies including augmented and virtual reality, with commercial activity underpinned by the blockchain — has the potential to alter, not only our consumer lives, but our entire way of living.
In a not-too-distant future, people may spend significant proportions of their time working, learning, playing and, of course, shopping in the metaverse, where virtual assets — from apparel to real estate — may take on both social and economic value that meets or even exceeds that of physical possessions.
Most of the chatter about the metaverse is positive. Technologists see it as a new frontier in our relationship with technology. Marketers view it as a greenfield for additional product categories and revenue streams. Investors see it as a new realm for return on capital. And for those of us who study the future of industries, there’s a general air of enthusiasm around what we see as a historic evolution of the internet of today.
But as with any significant technological advancement, there are three crucial questions that retailers and their backers need to ask before plunging into the metaverse.
Is it possible? Even by virtue of the rather clunky and primitive metaverse-like technologies we use today, it’s clear that building an immersive digital universe is indeed possible. And with the current pace of innovation, we’ll very soon have the hardware and plumbing required to power this.
Is it probable? More immersive, engaging and real-feeling experiences are a logical evolution of our online lives. And with the biblical sums of capital pouring into new players, platforms and projects, the metaverse is almost certain to take shape on an accelerated curve.
And finally, is it preferable? This third and perhaps most critical question is one I have barely heard asked. While the metaverse may indeed be possible and probable, the question is will it ameliorate or exacerbate the problems that society currently faces, from poor mental health to the climate crisis?
This is not simply a moral question, but one that has serious business implications for retailers, already under increased scrutiny for their environmental and social impact, particularly if they view the metaverse as a bridge to younger generations of consumers who increasingly consider a brand’s position on environmental and social issues as they make purchasing decisions.
Today, experts not only note increased sleeplessness, loneliness, depression and suicide among teenagers, but are also able to draw correlations to increased use of social media, a virtual display-case for lifestyles that can result in heightened feelings of inadequacy and anxiety. Now consider that, in the metaverse, you are likely to be judged not just by how you look in the real world, but by how your avatar is adorned, by your virtual sneakers or virtual cosmetics. Your address on a platform like Decentraland may matter as much as your real-world address.
While it’s easy to be seduced by the upsides of any technology we mustn’t forget that in 2006 Mark Zuckerberg said simply “Facebook is about real connections to actual friends,” a notion so utopic-sounding that 2.8 billion people signed up. What Zuckerberg didn’t mention was that it would come with a cesspool of online bullying, misinformation and political division, a hellscape that brands like Lush, for example, have recently quit, with Lush chief executive Mark Constantine telling the Guardian in late 2021 that he would happily lose the company’s 10.6 million Facebook and Instagram followers, and the estimated $13 million in revenue they represent, rather than be an accessory to Facebook’s malign effects on society. As we hurtle into the metaverse, brands will have new opportunity to choose the platforms and protocols they subscribe to and should do so thoughtfully.
What about the impact on creativity? Some celebrate a move to virtual goods as the “democratisation of design” giving anyone with an imagination and access to simple technologies the ability to become a fashion designer. But look at what democratisation of recording technology did for the incomes of musicians and songwriters or the overall quality of music. If anything, we’ve learned that more doesn’t always equate to better and that democratisation is sometimes Latin for commoditisation.
And, while it’s dirty, it’s certainly no secret that the global retail industry is one of the planet’s heaviest polluters. The apparel industry alone generates 8 percent of the world’s greenhouse gases. For this, the metaverse offers little real remedy, because the sheer power and cloud computing requirements to mount such a persistent, all-encompassing, collective reality will be astronomical. Studies of gaming platforms, for example, have estimated that if only 30 percent of video-gamers move to cloud-based gaming platforms by 2030, carbon emissions, resulting from the increase in required computing power, would increase by 30 percent. Now imagine the toll taken by an entire planet moving to a cloud-based metaverse. It’s likely that any possible environmental gains from things like lower reliance on daily commuting to work or lower consumption levels of physical apparel would be erased entirely.
And speaking of virtual apparel, what would this mean for the tens of millions of garment workers around the world who depend on physical manufacturing jobs for their survival? Does anyone really think we will turn these people into digital clothing designers? Or will we simply consider them the blacksmiths of the modern era and move on?
The metaverse brings us, as a society and a retail industry, to an important crossroads. There is little doubt that it offers great promise for financial gain, but just as we eagerly calculate the upside, so too should we be estimating the social and environmental costs and doing what we can to avoid them.
Retailers will undoubtedly play a pivotal role in financing the metaverse. And it’s that role that gives them power — the power to insist on a metaverse that’s safe, secure and sustainable. With construction of the metaverse well underway, it’s time to embrace that power and bake environmental and social responsibility into our strategies from the start.
Doug Stephens is the founder of Retail Prophet and the author of three books on the future of retail, including the recently released ‘Resurrecting Retail: The Future of Business in a Post-Pandemic World.’
