Key notes from New Frontiers in Fashion and Technology dedicat | MetaSavvy

Key notes from New Frontiers in Fashion and Technology dedicated to metaverse & fashion.

The marketing value of digital fashion and NFTs may now be clear, but fashion brands will need to separate hype from the concrete opportunities to generate sustainable revenue streams presented by growing consumer engagement with the metaverse.

Pioneers in the metaverse have shown there is a business case for fashion brands to invest in virtual worlds. Granted, a fully formed metaverse — comprising an interconnected, virtual ecosystem that overlaps with or offers an alternative to physical reality — is not yet possible given technology constraints. But brands’ experiments with metaverse principles, such as virtual fashion, extended reality, gaming and non-fungible tokens (NFTs), demonstrate the impact that virtual activities can have as marketing and community-building tools for fashion. Global spending on virtual assets reached around $110 billion in 2021 and is expected to grow at roughly the same rate as the gaming market to be worth around $135 billion or higher by 2024.

The next frontier for leading brands will be to translate unproven technologies into sustainable revenue streams, effectively separating hype from reality. Over the next two to five years, fashion brands focused on metaverse innovation and commercialisation could generate more than 5 percent of revenues by investing in virtual activities today.

Looking beyond a five-year horizon, some bullish observers expect mass consumer adoption of virtual worlds, creating the biggest opportunity for the fashion industry since e-commerce. The bears predict that the hype around the metaverse will fade as technologies fail to meet expectations or users prove reluctant to use virtual spaces as extensively as some business plans are counting on.

The pace of adoption will be driven by technological advancement, the interoperability between virtual environments and social acceptance. Tech players as well as fashion start-ups and brands need to develop technologies that help evolve today’s unrefined virtual experiences into mature, immersive realities. Mass consumer adoption could be a significant hurdle — 78% of people who have already ventured into virtual worlds say they miss physical interaction when doing so.

In virtual spaces and on social media platforms, the appetite for creating and adapting online identities is high: approximately 70% of US consumers from Gen-Z to Gen-X rate their digital identity as somewhat important or very important. A similar appetite for virtual goods can be found in China, where 70% of luxury consumers have purchased or will consider purchasing virtual assets.