Brands are setting up shops in the metaverse as consumer interest in virtual shopping rises

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The accelerated shift to digital channels during the global pandemic outbreak has only unlocked greater potential for the widespread adoption of the metaverse. Over the next few years, more and more consumers are expected to be interested in shopping in the metaverse globally. According to PayNXT360 estimates, over 36% of the consumers in the United States plan to use the metaverse for online shopping. Whereas, in the United Kingdom, 27-30% of the consumers are planning to shop online through metaverse. Amid these changing online shopping preferences among consumers globally, an increasing number of brands are setting up shops in the metaverse. For instance,

• In September 2022, Bloomingdale, the department store, announced the launch of its virtual store in the metaverse, which has been designed by Emperia. Launched during the New York Fashion Week, the virtual store features collection from brands like Marc Jacobs, MCM, Polo Ralph Lauren, David Yurman, Byredo, and Baccarat. The brand is offering customers an opportunity to have an engaging and immersive experience through its metaverse store.
• Kate Spade, a New York-based brand, also announced that the firm is foraying into the metaverse space in September 2022. Notably, the brand has invited customers to shop its autumn 2022 collection in the metaverse. Launched on the official website, the metaverse shopping experience will allow shoppers to move from room to room, eventually ending up in the kitchen where they can purchase the exclusive croissant clutch.
• In February 2022, Benetton, the Italian brand, also announced that it is entering into the metaverse. Notably, the firm adopted an omnichannel approach by linking the metaverse experience with physical in-store purchases. The innovative approach adopted by the brand offered consumers a chance to dive deep into a mix of physical reality and digital connection.

Notably, the growing trend of metaverse shopping has also gained widespread momentum across the Asian and Middle East regions. For instance,

• In June 2022, MG Motor India, the British automotive firm now owned by SAIC Motor, became the first auto OEM in India to enter into the metaverse through the launch of its metaverse platform, MGverse. Notably, MGverse combines multiple virtual spaces in a single platform, allowing customers, fans, partners, and employees to work, engage, socialize, and shop together.
• In Thailand, Advanced Info Services, the largest mobile operator in the country, took a leap into the metaverse space during the global pandemic outbreak when retail markets were forced to close down. Notably, the firm opened a virtual shopping mall, V-Avenue, which allowed shoppers to browse more than 200 shops. The metaverse shopping experience garnered nearly two million unique visitors.
• In China, Taobao, one of the leading online shopping platforms, announced its foray into the metaverse in May 2022. The firm launched Metaverse Mall during the 618-shopping festival in China. In the virtual shopping world, users can control their movement through smartphones, guiding characters to walk and shop in the metaverse.
• In June 2022, Magnati, the payments solution provider in the United Arab Emirates, also announced the launch of a metaverse marketplace with an integrated payments infrastructure. The Magnati-MetaV experiential commerce platform is expected to provide retailers in the Emirates with a more immersive way to reach their targeted customers through the co-created virtual stores.

With the consumers' interest in virtual shopping expected to increase further, especially among Gen Z and millennials consumers, TechInsight360 expects more brands to set up shops in the metaverse over the next three to four years. For brands, the metaverse is also expected to be a crucial play when it comes to driving customer engagement.

Due to its immersive nature, metaverse can improve customer engagement in a significant manner, which can further result in higher conversion rates for retailers and brands. Consequently, TechInsight360 expects more brands and retailers to increase their spending and investment in the metaverse segment from the short to medium-term perspective as they look to build the future of online shopping and drive incremental revenue.