{"id":2732,"date":"2022-04-20T01:07:13","date_gmt":"2022-04-20T05:07:13","guid":{"rendered":"https:\/\/advertisingweek.com\/aw360\/2022\/04\/20\/how-loyalty-will-survive-in-the-metaverse\/"},"modified":"2022-04-20T01:07:13","modified_gmt":"2022-04-20T05:07:13","slug":"how-loyalty-will-survive-in-the-metaverse","status":"publish","type":"post","link":"https:\/\/advertisingweek.com\/aw360\/news\/how-loyalty-will-survive-in-the-metaverse\/2732\/","title":{"rendered":"How Loyalty Will Survive in the Metaverse"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><em>By <a href=\"https:\/\/www.linkedin.com\/in\/rabih-farhat-b566bb4\/\" aria-label=\"Rabih Farhat click to see linked in profile\">Rabih Farhat<\/a>, Founder and Managing Partner, <a href=\"https:\/\/related.me\/\">Related<\/a><\/em><\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">From copper coins to stamps, then cards and ultimately digital platforms, the <a href=\"https:\/\/blog.smile.io\/a-history-of-loyalty-programs\/\" aria-label=\"centuries long click to read on smile dot IO\">centuries-long<\/a> evolution of loyalty programs seems to be on the cusp of another great leap.<\/p>\n\n\n\n\n\n\n\n<p class=\"wp-block-paragraph\">Unlike the cost-conscious switch from copper to paper, the recent migration to digital is being driven by a shift in consumer behavior \u2014 namely, an ever-growing relocation of shoppers to digital channels and platforms. In this new congested, highly competitive world, building customer experiences takes center stage.<\/p>\n\n\n\n\n\n\n\n<p class=\"wp-block-paragraph\">Now, the newest iteration of digital realms, the long-awaited Metaverse \u2014 a persistent, wholly immersive virtual world \u2014 promises to usher in a new era for loyalty marketing.<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\">Hitting the Mainstream<\/h2>\n<p class=\"wp-block-paragraph\">While technology was not yet ready and scalable to handle a <a href=\"https:\/\/en.wikipedia.org\/wiki\/Second_Life\" aria-label=\"second life click to read on wikipedia\">Second Life<\/a> concept, today with the roll out of high speed\/low latency data providers like 5G, the adoption of an immersive technology became more user-friendly and virtual experiences became even more convenient and efficient than physical ones. As adoption increases, brands will start to flock, and loyalty marketing will have to follow.<\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">Generally, market projections and estimates have varied greatly \u2013 Goldman Sachs, for instance, <a href=\"https:\/\/www.goldmansachs.com\/insights\/pages\/gs-research\/framing-the-future-of-web-3.0-metaverse-edition\/report.pdf\" aria-label=\"expects click to download PDF from goldmansachs\">expects<\/a> the Metaverse market to reach anywhere between 1 and 12 trillion dollars. There is also little information from Meta on how well its Metaverse-related projects are faring. We do know, however, that Horizon Worlds, one of Meta\u2019s high-profile VR projects and a core component of the \u201cMetaverse vision\u201d according to Zuckerberg, has seen its user base increase 10 fold each month since launch in December 2021.<\/p>\n\n\n\n\n\n\n\n<p class=\"wp-block-paragraph\">With a growing millennial population where half of them have grown up with video games, e-sports, and social media, many of them see the emerging metaverse as a modern day mall; a connected world where they can hang out, shop and socialize. Fully virtual in-game events have also been well received: we\u2019ve seen concerts, album releases, Disney even premiered \u2018Star Wars: The Rise of Skywalker\u2019 exclusively inside Fortnite. Other industries following suit seems to be a matter of time: According to a <a href=\"https:\/\/www.jpmorgan.com\/content\/dam\/jpm\/treasury-services\/documents\/opportunities-in-the-metaverse.pdf\">whitepaper by JPMorgan,<\/a> the Metaverse \u201cwill likely infiltrate every sector in some way in the coming years.\u201d<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\">What Does This All Mean for Loyalty Marketing?<\/h2>\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/www.prweb.com\/releases\/new_study_reveals_how_gen_z_consumers_are_shopping_in_the_metaverse\/prweb18455762.htm\" aria-label=\"early studies click to read on PR web\">Early studies<\/a> around virtual shopping are showing great promise: 70% of all consumers who have visited a virtual store have made a purchase, and most said that they would do it again. Interestingly as well, that same study revealed that more than half of its respondents (52%) were willing to pay as much as $50 for a virtual product for their avatar. More on this later.<\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">As e-commerce in the metaverse takes off, loyalty marketers will have to adapt their strategies while staying true to their two key pillars: value and experience. The hyper-immersive nature of virtual worlds engenders limitless opportunities to craft and deliver hyper engaging experiences that delight customers; early movers will also have the chance to capitalize on the sense of awe and enchantment that this new medium inspires in people. Delight, and consequently loyalty, that is nurtured in the Metaverse will also trickle to real world, and vice versa.<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\">The Rise of Digital Ownership and NFTs<\/h2>\n<p class=\"wp-block-paragraph\">People\u2019s willingness to spend on virtual novelty items \u2013 such as accessories for an avatar as we mentioned above \u2013 is a growing trend, and one that bodes particularly well for the future of loyalty marketing, as it lends credence to the immense potential of NFTs.<\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">In fact, the meteoric rise of non-fungible tokens is testament to the growing perceived value of unique and exclusive, though intangible, items. Businesses have already started capitalizing on this. In New York, a restaurant selling exclusive-access tokens has turned into <a href=\"https:\/\/www.washingtonpost.com\/food\/2022\/01\/15\/nft-restaurant-flyfish-new-york\/\" aria-label=\"a craze click to read on washington post\">a craze<\/a> \u2014 a regular-membership token sold for over $13k on the secondary market; higher-tier tokens broke $29k.<\/p>\n\n\n\n\n\n\n\n<p class=\"wp-block-paragraph\">And brands are just beginning to experiment with NFTs in their loyalty schemes, be it as tokens that unlock VIP perks and deals, or branded digital collectibles that have intrinsic value. So what can marketers do? Well, much like we\u2019re seeing with digital art pieces, a well thought-out and careful investment into the technology will only appreciate over time.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The newest iteration of digital realms, the long-awaited Metaverse, promises to usher in a new era for loyalty marketing.<\/p>\n","protected":false},"author":7,"featured_media":2733,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","editor_notices":[],"footnotes":""},"categories":[1],"tags":[6],"topics":[2],"class_list":["post-2732","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-tech","topics-editorial"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.0 (Yoast SEO v28.0) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>How Loyalty Will Survive in the Metaverse | 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