From GPT to Decentraland: 4 reasons more brands will enter the metaverse in 2023

In this article, we look at the top four predictions as to why the metaverse will become part of many brands’ marketing and digital transformation initiatives in 2023.

Metaverse is often a term used to describe a 3D virtual world, which could be built on top of blockchain infrastructure.

1. Generative AI will simplify metaverse development

Creating content for the metaverse is becoming a whole lot easier with the increasing ubiquity of generative AI. Whether it is creating entirely new virtual worlds or assets within the metaverse.

Creating characters, dialogue, buildings, assets for games, game strategy is challenging and often needs teams of people who have specialised skillsets.

In gaming metaverses, non-playing characters (NPCs) are a key example where lots of effort is required to create their skins and dialogue, but where they add little to the game or experience.

For those who are launching NFTs which serve as a ticket to a metaverse space, it saves brands thousands of dollars they would normally pay an agency or artist to create the artwork for the NFT collection.

There are now generative AI tools which allow the creation of all these digital items simply by typing text prompts in natural language.

Alethea AI's CharacterGPT allows you to create character skins by typing in a text prompt. Google AI allows you to create original music in any genre from a text description.

OpenAI, Stable Diffusion and Midjourney are the main players offering generative AI tools that are publicly available to use.

2. Significant corporate investment will drive growth

The metaverse is no longer a niche space, with corporations such as Starbucks, Reddit, and Nike already jumping on board. In the last 12 months alone, these brands invested millions into the metaverse.

Starbucks launched a web3 loyalty program and NFT community called Starbucks Odyssey. It includes a platform where customers can engage with interactive activities that allow members to earn collectibles called Journey Stamps.

Reddit minted five million NFTs through its avatar initiative, the single largest mint by volume by any company. Many avatars were given away for free to highly active users, which they could use as profile pics and which gave them social power such as standing out in comments, and the ability to give high value awards.

Nike's acquisition of RTFKT, a company specialising in digital sneakers, in December 2021, was a major move towards the metaverse. Nike has continued building in this space and recently launched dot swoosh, a platform which allows fans to design their own digital sneakers.

Importantly, these brands are using familiar terms such as digital assets, collectibles, and loyalty items, and avoiding jargon as much as possible.

Brands are aware that consumers are becoming hyper-digitised, and therefore corporate investment is expected to increase significantly. It will be driven by a combination of FOMO and digital transformation strategy.

3. Brands will increasingly opt for familiar web2 user experiences

Gone are the days when consumers were happy to jump through several hoops to get their hands on a NFT. For early adopters, it was considered a rite of passage to sign up for wait lists, join a discord server, then navigate another 10 steps for the privilege of handing over money for a NFT. We have moved beyond the phase of early adopters to early majority on the consumer adoption curve.

Brands are offering familiar user-friendly experiences which allow consumers to sign up for accounts, which discreetly spin up a digital asset wallet in the background that is tied to their user account. The primary payment method for goods offered is Stripe or PayPal, with a secondary option to pay in crypto.

NBA Top Shot successfully onboarded traditionally non-crypto fans with a web2 like experience. While Nifty Gateway, one of the earliest NFT marketplaces, has always provided the ability for users to purchase with credit card.

Improved, simplified, and familiar user experiences will onboard more mainstream consumers, and brands will be interested in where consumers are heading.

4. Owning and building a digital space in the metaverse just got easier

One of the most well-known blockchain based metaverses is Decentraland. It recently launched Worlds, which allows people to affordably create bespoke personal 3D spaces to build, experiment and host events without owning or renting land. It now costs on average $30 to own land as opposed to $3000.

Another metaverse platform, Spatial, has launched the Spatial Creator Toolkit powered by Unity. This allows creators to use a sophisticated game engine and publish straight from Unity to Spatial on a web browser or mobile device. Game metaverses used to require significant compute power and powerful graphics cards. The new tools represent a significant change as to accessibility from a hardware viewpoint.

Brands such as Samsung, Heineken, Nike, Coca-Cola, Dominos and Adidas have created experiences in Decentraland. Spatial has collaborated mostly with high profile NFT collections.

While both features are still in beta, the launch of these has lowered the barrier to becoming a metaverse creator.

Previously, companies wanting to experiment in the metaverse would have considered outsourcing the work. Increasingly, external agencies will only be engaged when brands are ready to build bigger scalable experiences. Brands are now able to experiment with existing resources cheaply and easily.