As the world continues to become more digitised, the concept of the metaverse has become a hot topic in many industries, including luxury fashion.
In recent years, the fashion industry has witnessed a paradigm shift in the way it operates, with the emergence of new technologies and innovative ideas.
Since the concept of metaverse offers a virtual space where people can interact with each other and digital objects, it offers endless possibilities for brands to connect with consumers in new and exciting ways, becoming the next frontier for businesses to explore, especially in the luxury fashion sector.
According to a report by Technavio has suggested that the global metaverse in fashion market size is expected to grow by $6.61bn from 2021 to 2026, accelerating at a compound annual growth rate of 36.47 per cent.
Luxury fashion brands have always been at the forefront of innovation, constantly pushing the boundaries of what is possible in terms of trends and customer experience.
Therefore, it is no surprise that brands like Burberry, Louis Vuitton, Balenciaga, Gucci, Dolce & Gabbana, Boohoo etc. have paved the way for what the future of fashion industry looks like, through exploring the potential of the metaverse as a means to create new revenue streams and present innovative paradigms of immersive customer experience.
Here are a few ways luxury fashion brands can use the metaverse to their advantage:
Immersive and interactive shopping experiences: One of the biggest challenges of shopping for luxury fashion online is that consumers can’t try on the clothes before making a purchase. However, with the metaverse, luxury fashion brands can create virtual try-on experiences that allow consumers to see how a garment looks on their digital avatar before making a purchase.
By leveraging real-time data and artificial intelligence, these fashion brands can create a virtual environment that is tailored to each customer’s preferences, interests, and purchasing history. By offering these unique experiences, luxury brands can make shopping more engaging and personalised, leading to increased customer satisfaction, higher levels of conversions, customer satisfaction and brand loyalty. Moreover, such experiences can drive word-of-mouth marketing, attracting new customers and enhanced brand awareness.
Potential collaborations and partnerships: A report by McKinsey indicated that 59 per cent of the consumers are in favor of transitioning their everyday activities like shopping to metaverse, immersing themselves with new type of experiences.
By using virtual environments, designers can create and test out new virtual asset ideas without the need for physical prototypes or the risk of making costly investments. Luxury fashion brands can explore collaborations and partnerships with other businesses, artists, and influencers within the metaverse.
These partnerships can lead to exclusive product lines, virtual pop-up stores, or co-branded virtual events, driving excitement and interest among customers and at the same time make more revolutionary and innovative fashion designs, which can help brands to stand out in a crowded market. Collaborations can also help luxury brands tap into new customer segments and increase their reach in the rapidly growing metaverse market.
New revenue streams through digital goods and NFTs: Non-fungible tokens (NFTs) have become a popular way for artists and creators to sell digital assets such as artwork and music. However, NFTs also have the potential to revolutionise the way luxury fashion brands interact with consumers in the metaverse.
For example, luxury fashion brands could create limited edition virtual items, such as clothing or accessories, that are sold as NFTs. By creating digital assets that are unique and valuable, brands can tap into a new market of consumers who are looking for ways to express themselves and engage with their favourite brands in the metaverse.
These virtual items could be used to customise avatars or as part of virtual fashion shows or pop-up shops. They could also use NFTs as rewards or achievements within virtual gaming environments. This can also help to create a sense of community around a brand, increase brand awareness, foster customer loyalty and engagement among gamers, who are a growing and influential demographic.
As with any new avenue, brands must ensure to invest in the right technology and infrastructure to offer an experience that is smooth and seamless for their customers. While the metaverse is still a relatively new concept, it’s clear that it offers a plethora of possibilities for luxury fashion brands to connect with consumers in new and exciting ways.
By creating customisable virtual storefronts, offering immersive and interactive shopping experiences, utilising AI-driven insights, hosting virtual events and experiences, collaborating with other brands and influencers, and exploring new revenue streams through digital goods and NFTs, luxury fashion brands can solidify their position in the ever-growing metaverse market.
Companies such as Shaffra, is empowering businesses in overcoming metaverse-related challenges, through introducing an affordable and revolutionary solution called ‘metaverse-as-a-service’ for luxury fashion businesses to make that seamless leap towards launching their metaverse strategy, transforming their brand experience with immersive virtual interface and bespoke metaverse platform.
By embracing this new frontier, luxury fashion brands can boost their revenue, create a more engaging and inclusive shopping experience for consumers, stay ahead of their competition and secure their place in the future of retail.
Alfred Manasseh is the co-founder and chief metaverse officer of Shaffra
