Is the Metaverse the New Loyalty Frontier? Part 1
Is the Metaverse the New Loyalty Frontier?
Part 1: An Introduction
Ko de Ruyter, Debbie Keeling and David Cox
Facebook’s latest re-branding to Meta has created both excitement and puzzlement in the global world of business. The metaverse has made it to the list of top 10 words for the year 2021 according to the Collins Dictionary.
We are hearing that loyalty marketers are also asking themselves and each other whether this is an ecosystem that holds a strategic promise for their brands. At the same time, there is confusion around what the metaverse actually is and how it can realistically add value to business relationships and loyalty programs. To date, no common understanding exists as to what the metaverse actually is or, more importantly, could be.
Some pundits limit the metaverse to a shared online space with 3D graphics, while others emphasise that it is a network of virtual worlds that is inter-operable and can be experienced synchronously. Others view the metaverse as the next version of the internet or the spatial web that users experience as ‘living within it’ rather accessing it. This lack of a shared understanding among business strategists prevents plotting a course forward.
Reframing the metaverse
However, reframing the metaverse as a ‘place’ or ‘space’ where people socialise, work, shop, and participate in activities offers a very different potential for, what could be termed, as a synthetic loyalty experience that seamlessly combines physical and technology-enhanced realities. This definition implies that in the metaverse, physical and digital worlds seamlessly converge to form a new reality. This new reality is predicated on synthetic customer experiences, where natural/physical experience is extended through technology.
Crucially this new reality can also uniquely engage customers and address their diverse needs:
· cognitive needs (how can we challenge customers to think about us differently?)
· emotional needs (how can we excite customers in different ways),
· behavioural needs (how can we get customers to act in different ways)
· sensorial (how can we fundamentally change the way in which customers perceive their experience of our brands)
· social needs (how can multi-way exchanges between firms, customers and other customers be better harnessed in a metaverse)
Now that we have set the scene, we will revert back to the title of this piece, one that perhaps caught your interest in the first place: Is the Metaverse the new loyalty frontier?
There are three reasons why we are mildly optimistic and would tend to answer this question with ‘possibly yes’:
1. The emergence of interesting loyalty marketing use cases
as we gather initial evidence that the metaverse is a channel that loyalty marketers should consider embracing, some interesting examples keep popping up. In particular, the metaverse offers novel ways of customers and program members experiencing exclusivity.
2. Key cornerstones of the current metaverse are very real today
this includes cryptocurrencies, digital collectibles (such as NFTs), blockchain and reality enhancing technologies (augmented, virtual and neuro reality). This will help in demystifying the concept of the metaverse and to separate the reality from the hype.
3. Awareness that virtual and physical experiences are sensorily similar
what is crucial to the successful development of the metaverse is that people have become largely aware that we are reaching a level where virtual and physical are sensorily similar. The metaverse’s value-add is rooted in the acceptance that that it represents a genuine reality in which users can socialize, work, and play. A new generation of customers is growing up spending a large portion of time ‘being in’ and even ‘building’ hybrid worlds like Fortnite.
Watch out for Part 2 of our Metaverse Loyalty Frontier blog series when we will zoom in on examples of how some brands are trailblazing use of the metaverse to support their loyalty strategy.
