Luxury fashion houses are pouring millions of people into the metaverse. But for what?

written by Oscar Holland, CNN

This story is part of an ongoing project for CNN Style. September issue: A thought-provoking hub about fashion’s impact on people and the planet.

When a virtual Gucci Dionysus handbag went on sale online last year for a value of $4,115, it wasn’t just the price tag that grabbed attention. It was the fact that he could buy the real thing for $700 less.

The four-figure sum paid by users of gaming platform Roblox was relatively pennies for the label, which generated $9.7 billion in revenue in 2021. (equivalent to under $6), an astronomical price later achieved on the resale market.

But what became clear in this moment is that some people value their digital wardrobe as much, if not more, than their physical wardrobe.

This is an idea that changed the world. fashion industry over the past two years. From Balenciaga selling skins for his characters in Fortnite, to Ralph Lauren, digital clothing line On South Korean platform Zepeto, luxury brands are entering these wildly popular new digital worlds.

Whether these platforms are part of the so-called “Metaverse” (a term that came to the spotlight when Facebook rebranded as Meta last year) or are simply online games, millions of People are spending time in immersive, interconnected digital environments. As such, major labels are launching virtual events, exclusive drops, and shops with collections of Avatar clothing.

The industry is hyping up about the opportunities in the new digital landscape. Recent reports Consulting firm McKinsey says fashion is “at the forefront of the metaverse shift.” This enthusiasm stems from past mistakes, according to Charles Hambro, who owns the agency Geeiq (pronounced “geek”), which helps companies like Tommy Hilfiger and his Farfetch “navigate the metaverse.” There is likely to be.

“Fashion brands have been particularly slow to respond to social media. ‘They don’t want to be late again.'”

“There are 3.2 billion people playing games today, but they are not just entering virtual worlds to play games. There is,” he added, comparing the fashion industry’s recent efforts to what it is trying to do. To “fit in with the R&B and hip-hop culture” of the 1990s. “Connecting with this audience is very important if a brand wants to be culturally relevant.”

experience matters

At face value, digital apparel is just one revenue stream for luxury brands. Dolce & Gabbana’s first of his NFT series, his nine-piece collection featuring dresses, crowns and men’s suits (more than half of which are simple digital versions of physical items) sold for $1. . reported $5.7 million Last year, through luxury marketplace UNXD

Margins are definitely attractive. For example, the cost of creating a free, infinitely replicable virtual sneaker is significantly lower than manufacturing and distributing thousands of physical equivalents.

Last year, Balenciaga debuted a selection of player “skins” and digital accessories for the online game Fortnite. credit: epic games

But perhaps more importantly, the metaverse will give brands access to a whole new generation of customers. The customer base was often younger than traditional luxury shoppers and may not have been associated with high fashion. In fact, what’s remarkable about Gucci’s Roblox experience, his Gucci Garden, isn’t necessarily the headline-grabbing handbag sales, but the fact that the virtual space has attracted a staggering 20 million users. .

This kind of brand-building activity could ultimately lead new customers to physical products now or when their disposable income increases.a report According to consultancy Bain, 70% of luxury purchases involve some form of online interaction (meaning that shoppers had at least one digital interaction with a brand or product before making a purchase decision). I know I am affected.

However, according to Hambro, successful brands will not be those that treat the virtual world as an advertising space or money maker, but those that create fun and meaningful experiences for their users.

“Facebook makes money from brands, Instagram makes money from brands, but Roblox makes money from players,” he said. “So when brands enter these virtual spaces, they need to enrich the experience because it’s a completely different model. It’s not about putting your logo in front of your eyeballs and putting them in front of your eyeballs, they’re scrolling through their feeds.Brands need to make real connections with these audiences.”

The label seems to have embraced the idea. In March, Dolce & Gabbana and Tommy Hilfiger are among his first-ever leading names to attend his Metaverse Fashion Week. (The event was ruined, but Technical issues and graphical glitches, it showed that the brand was willing to take risks in an industry built on reputation. ) Brands are also increasingly producing clothing that can be integrated into people’s online lives, rather than simply replicating physical clothing as NFTs that are stored and sold in digital wallets. At a later date.
Burberry's Digital Lola bags sold on Roblox for the equivalent of $9.99 each.

Burberry’s Digital Lola bags sold on Roblox for the equivalent of $9.99 each. credit: burberry/roblox

As a result, users are choosing what to buy based on their preferences rather than resale value, Hambro said. Take a look at Burberry’s recent Roblox releasehas reimagined the iconic Lola bag with “special materials like clouds, water and wild leaves”. Similar to his traditional NFT sale, the label will sell his 800 Robux (worth $9.99) for an unlimited number of bags 24 hours a day, allowing buyers to buy bags anywhere in the platform world. I was able to wear it.
What Intrigued the Geeiq Co-Founder — His Company Later analyzed Sales data — price was not linked to item rarity. Quite the opposite, in fact, Burberry’s most popular bags (i.e., most common styles) during his one-day sale period remained the most expensive on the secondary market.

“This is the exact opposite of what we see with NFTs, which has a lot to do with the rarity of the NFT itself,” said Hambro, who believes the item’s value comes from “the aesthetics of the product itself.”

“These individuals were buying these products not just to own and flip, but for self-expression.”

digital identity

British stylist Gemma Shepherd, often referred to as “the first stylist of the metaverse,” says that self-expression and creativity are at the heart of digital dressing, just like fashion in the real world.

“Two years ago, my granddaughter asked for shoes for Avatar,” recalls Shepard, former director of luxury jewelry brand Boucheron, who was later appointed global fashion director of the Metaverse at game development studio Duvitt. . “The shoes were worth £60 ($70) at the time, and her mother said, ‘No way, they’re more expensive than the shoes you’re wearing on your feet.’ , I started talking to her and realized it was really important to her that her avatar had these sparkly shoes.

“I had this massive perception,” she added. “This is how Gen Z behaves. This is where they are. This is their communication. Their identity in the metaverse really matters. .”

According to a 2021 survey, nearly 70% of U.S. consumers from Gen X to Z consider digital identity to be “important.” study by the business of fashion. Shepard’s advice for the brand (and her own playful design ethos) is to tap into the creative potential of the medium.

“All my concepts are based on how I work in the real world with traditional mood boards, but I let my imagination run wild,” she says. He mentioned his new collection. The bag doesn’t have to work that way on Roblox, it works in the real world.”

Italian label Etro hosted a digital runway show at Decentraland's Metaverse Fashion Week in March.

Italian label Etro hosted a digital runway show at Decentraland’s Metaverse Fashion Week in March. credit: Vittorio Zunino Cerotto/Getty Images

Conversely, Sheppard said virtual worlds could offer brands the opportunity to road test their real designs before they go into production. However, she added, it would be a mistake to assume that people would wear the same clothes in virtual life as they do in real life.

“That’s the beauty of the Metaverse,” she added. “I live in Ibiza and they say you can’t strip your clothes. You can wear a Swarovski gown and come right off the beach in a bikini and that’s perfectly fine To some extent, it applies to the metaverse.”

Future question

The future of the immersive digital world remains a matter of speculation, as much as new technological changes.

Some observers even question whether the Metaverse, or at least the Mark Zuckerberg-pedaled version of Metaboss, will ever come to fruition. According to talent analytics firm Revelio Labs, there was an 81% drop in new job postings with the word “metaverse” in the title between April and June of this year. (To treat this as an industry death warning would be like writing off the Internet based on the 1990s “dotcom bubble.”)

Nevertheless, investment bank Morgan Stanley predicts that digital fashion could boost industry sales by $50 billion by 2030. ReutersHeritage brands will face stiff competition for market share from web-first brands like the self-proclaimed “digital fashion house” The Fabricant. It also remains to be seen whether selling virtual goods for a few bucks will ultimately undermine luxury brands’ physical appeal in a sector built on aspiration and exclusivity.
Ralph Lauren has launched a digital apparel line on South Korean platform Zepeto.

Ralph Lauren has launched a digital apparel line on South Korean platform Zepeto. credit: ralph lauren

A more pressing question is whether we will one day be able to access digital wardrobes in different virtual worlds (e.g. items purchased in Fortnite or Decentraland can only be used on those specific platforms). ). Dubit’s chief of commercials his officer, Andrew Douthwaite, said that despite users’ apparent interest in owning his closet for a cohesive, cross-platform meta, this poses a major technical challenge. said to bring

“’Interoperability’ has been a buzzword in the metaverse for the past year or so. “I think it’s definitely something to strive for,” he added.

Other potential opportunities exist where the digital and physical worlds collide, such as augmented reality (AR) and virtual reality (VR). Virtual “try-on” technology has made great strides in recent years. For example, shoppers can now see what clothes look like without having to walk into a store or mail unwanted clothes. Future applications will also rely on the development of “mixed reality” smart devices such as his glasses, Hambro said.

“What’s really exciting about this is getting into the speculation and guesswork about when the hardware will be good enough, but through the glasses you’re wearing right now, you can’t see me wearing my original different clothes.” You can see it. It’s an NFT that I own,” he said.

It’s probably this future that the fashion industry is betting millions of dollars on.

Source: www.cnn.com

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