In October, Mark Zuckerberg (co-founder and CEO of Facebook) announced that the company would begin investing in creating the metaverse. He stated that “The metaverse will not be created by one company. It will be built by creators and developers making new experiences and digital items that are interoperable and unlock a massively larger creative economy than the one constrained by today’s platforms and their policies”.
The idea of a metaverse is broad and there is no one set definition at present. However, it can be summarised as “a digital experience spanning interaction, commerce, experiences, interoperability, and the Internet of Things”. Although dismissed by some commentators as merely a PR stunt, Zuckerberg’s announcement touches upon the fact that the way that e-commerce is conducted may face radical change in the near future. According to Zuckerberg, “[I] hope that within the next decade, the metaverse will reach a billion people, host hundreds of billions of dollars of digital commerce, and support jobs for millions of creators and developers”.
Although Facebook is not the first company to begin working on a metaverse, the announcement raises a core question regarding the future iteration of the internet; what will e-commerce look like in the metaverse? Tech futurist Cathy Hackle reported that the metaverse would make purchasing a significantly easier process for consumers. She summed up the concept of virtual reality purchasing as follows: “Imagine walking down the street. Suddenly, you think of a product you need. Immediately next to you, a vending machine appears, filled with the product and variations you were thinking of. You stop, pick an item from the vending machine, it’s shipped to your house, and then continue on your way”.
The metaverse may also offer the technology that allows users to create their own virtual stores, where they are able to earn commissions on physical products that they carry. According to TCI entertainment, the metaverse represents the next iteration of e-commerce and retail and will provide the foundation for a new generation of entrepreneurs. It has also been hypothesised that users of the metaverse may be able to open digital franchises of real-world stores, stocking their virtual shelves with real-world products that other users may want to buy.
Kevin Indig, Director of Shopify, a multinational e-commerce platform, believes that the metaverse will most likely encourage the decentralisation of e-commerce. Decentralised e-commerce gives brands the ability to break free from uniform marketplace formats to virtualize the shopping experience, further bridging together the experience of shopping at home or in a store. This trend has been accelerated by the pandemic, especially in China. For example, WeChat’s mini programmes – ‘Instant’ Apps embedded in WeChat for disposable interactions, at a fraction of the cost of a full app—allows brands to sell products through WeChat and has been described as the next big shift in Chinese e-commerce.
Corporations have already begun to recognise these opportunities. According to Mastercard, the global augmented and mixed reality industry will grow at a compound rate of 54% to reach $372bn by 2026. Looking forward, we may soon begin to see a mainstream emergence of new forms of e-commerce as purchasing becomes an even more accessible process for consumers.
Source: Transport Intelligence, 25 November 2021
Author: Nia Hudson
