We all know Facebook. That place where your Grandmother posts gushing photos of all her grandchildren and makes awkward comments on your life updates in front of all your friends. She joined, along with nearly 3 billion people, the social media giant before it became Meta. But does she even understand what the Facebook Metaverse is? Do any of us?
If you don’t, it’s okay. We’re all figuring this out together. Especially us marketers who help clients navigate the choppy waters of Facebook Ads every day.
What is a metaverse, anyway?
The term “metaverse” was coined in Neal Stephenson’s 1992 science fiction novel Snow Crash, where humans, as avatars, interact with each other and software agents, in a three-dimensional virtual space that uses the metaphor of the real world. Various versions of a metaverse can be found in recent science fiction movies including movies like The Matrix and Ready Player One.
Facebook has said its metaverse is poised to be a world of endless, interconnected virtual communities where people can meet, work and play. Users will be able to experience the metaverse through VR headsets like Facebook’s Oculus and Google’s Daydream View.
We’re witnessing the rise of a digital economy
Most Americans have heard of cryptocurrencies like Bitcoin or Dogecoin. In January of 2017, one Bitcoin was valued a little more than USD $900. In November 2021, one Bitcoin reached a value equivalent to USD $69,000. According to a 2021 report from Gemini, roughly 14% of Americans own cryptocurrency. Major businesses including AT&T, Starbucks, and Overstock are now accepting bitcoin as payment.
Digital currencies are also used to purchase digital products. Recently, unique digital products known as non-fungible tokens (NFTs) have started to gain popularity. These are digital assets that cannot be replaced. For example, people can purchase digital art, tickets to an exclusive concert, or virtual clothing for their digital avatars. NFTs are usually bought with cryptocurrencies or in dollars and the blockchain keeps a record of transactions.
These are signs that point to a new kind of digital economy. All that’s missing is a more widely-accepted marketplace for consumers to make transactions. The Facebook Metaverse is poised to speed up the growing digital economy and open it to a wider range of consumers.
What will happen to Facebook as we know it?
The Facebook platform we all know isn’t going anywhere. In a 2020 study by Uswitch, Americans spent an average of 58 minutes on Facebook each day—the most among all social media platforms. Facebook didn’t seem to have trouble monetizing their user base. During the first eight months of the pandemic, Facebook’s market value increased 47%.
Still, the timing of Facebook’s re-name to Meta seemed suspicious. Especially with data privacy concerns continuing to nip at the heels of the tech company. It’s easy to point at the rebrand as a diversion to redirect public attention. Or, some may point to Apple’s iOS 14.5 update as the straw that broke Facebook’s back. While these all may be true to some extent, the bigger picture is Facebook will only be one part of Meta’s larger business operations. Zuckerberg is betting big on the metaverse and expanding his operations.
Advertising in the Facebook Metaverse
Just like in the real world, there will be advertisements in virtual reality. The Facebook Metaverse is no exception. “Ads are going to continue being an important part of the strategy across the social media parts of what we do, and it will probably be a meaningful part of the metaverse, too,” Zuckerberg said in an earnings call following the announcement of the new name.
Imagine a digital world like The Sims Video Game; a choose-your-own-adventure where you can build a virtual life—you can buy a house, clothing, even food for your avatar. Other real people are also building their virtual lives in the same world. And in these kinds of worlds, you’ll be inundated with advertisements.
So what different ad types will we see in the metaverse?
3D Display Ads
Billboards may almost look like videos playing higher up while you continue through this virtual reality. Advertisements are already making their way into video games due to the popularity of esports. These display ads can also be programmed to serve different ads to different users. Facebook’s Metaverse will likely be similar, with virtual billboards and banners for brand awareness.
The Facebook Metaverse may feature product placement for consumer goods, much like the Doritos bag in the image below. Clothing companies may work with influencers to feature virtual products, like “skins” for video game characters. You can virtually try on clothes, and even purchase virtual clothing for your avatar.
Virtual Meetings & Networking Events
The Facebook Metaverse isn’t just for consumer businesses. Business-to-business (B2B) companies will have the opportunity to market and sell in this environment. Virtual meeting rooms, conferences, and networking events may be the new frontier for industries like software or professional services.
Through virtual reality, residential real estate agents will be able to invite out-of-state buyers on virtual tours of housing inventory. Contractors will be able to show homeowners a renovation before construction begins.
Higher education marketers may offer virtual campus tours to prospective applicants. This may be attractive for out-of-state students. It can also be used to “gamify” the virtual campus experience.
Virtual Salespeople & “Experiential” Advertisements
Amid exploring the Facebook Metaverse you find virtual salespeople who come up to you, just as someone might come up to you on the street in real life asking for you to donate money or sign a campaign. Except these virtual salespeople will have an entire booth and product line with them.
How can marketers prepare for advertising in the metaverse?
While there is a chance the Facebook Metaverse will take off quickly, it will likely happen slowly over the next decade. It can take years for businesses to fully mature their digital presence on the existing version of the internet, let alone the metaverse.
However, there are marketing investments that businesses should consider now to make a seamless transition to the future of digital marketing.
- Optimize your existing website. The Google search algorithm is constantly evolving to help users find the answers to their questions as easily as possible. If your website is a conversion point where users can turn into leads or sales, it’s critical to keep your website up-to-date with industry best practices.
- Map your lead-to-sale journey. This will show which channels perform, which don’t, and other factors that influence a predictable revenue forecast.
- Produce high-quality creative. Maintain agility in addressing new creative formats as they roll out. Virtual reality ad formats will continue to evolve, so having a team that follows the latest developments will win.
- Create a feedback loop between analytics and creative teams. This will bridge a critical communications gap between these teams to inform campaign adjustments and direction. Insights from campaign tests can be used to show what kind of creative performs best. This could be as simple as testing logo placement, or as drastic as testing photography vs illustration.
- Build and scale a first-party data strategy. Consumer data is like fuel to digital marketing platforms. Larger, more robust consumer datasets help platforms use machine learning to create lookalike audiences that optimize return on ad spend.
- Stay up to date on the latest digital marketing trends. The one constant in marketing is change. Continuously learning and staying current on marketing best practices will help businesses become agile to shift with consumer behavior.
Moving Forward: Creating Standards for the Facebook Metaverse
A new dimension of social interaction brings on new data privacy concerns. “We want to be able to move around the internet with ease, but we also want to be able to move around the internet in a way we’re not tracked and monitored,” said venture capitalist Steve Jang, a managing partner at Kindred Ventures who focuses on cryptocurrency technology.
Video game companies are taking a leading role in building the metaverse space. Epic Games, the company behind the popular Fortnite video game, has raised $1 billion from investors to help with its long-term plans for their contributions to the metaverse.
Meanwhile, the U.S. Federal Government has been slow to respond to the transformation from an industrial economy to a digital economy. The Former Chairman of the Federal Communications Commission of the United States, Tom Wheeler, believes a focused federal agency should oversee big tech. He contends Congress should establish a 21st-century results-focused independent federal agency responsible for protecting consumer well-being and effective competition in the digital economy.
We’ve only just begun down the path to the metaverse. Only time will tell how we adapt and regulate this new virtual world.