Why retail requires long-term metaverse strategies

type - big idea
Big Idea
sector - media & technology
sector - retail
Justin Hochberg, CEO of Virtual Brand Group, explains the untapped benefits of the metaverse, from R&D to phygital marketing and avatar behaviour analysis

Let’s begin with Virtual Brand Group (VBG). What does it do and which gap in the market are you catering for?

We’re a metaverse creation company. We have identified a market gap, which is that global brands from Porsche to Polaroid are all dazed and confused about the metaverse. While the technology behind it isn’t new, it is new to consumers and brands, so we sit at the intersection of the technology, storytelling and brands.

Working with brands, we own and operate their intellectual property in the metaverse as a partner. They maintain brand control. We maintain operational control to create a sustainable business. We build long-term metaverse business strategies for brands, not just marketing stunts.

What are some of the misconceptions retailers have about the metaverse?

People say: ‘Great, it's just like e-commerce, we’ll sell in Roblox.’ And I have to tell them: ‘No, the goal is not to sell in Roblox or Decentraland or Sandbox. The goal is to take the metaverse and wrap it around all of your other experiences.’ In that vein, we have created the idea of Infinite Loop Marketing – a trademarked term that we own. It is the idea that one world pushes to the next, and then activates back into that world.

When marketing brands in the metaverse, what are the tangible benefits for shoppers?

Whether physical stores, e-commerce or catalogues, retail works in harmony but it’s also segmented. The beauty of the metaverse is combining virtual worlds and physical stores together – the Infinite Loop Marketing. If you visit the Forever 21 store in Roblox, for example, and buy an item, this issues a code that you can use on Forever 21’s website. It’s a call to action that encourages shoppers to move from Roblox to e-commerce, where they can buy their avatar the same fashion as they own in real life.

Published by:

7 March 2022

Author: Abi Buller and Kathryn Bishop

Image: Gucci Vault


Forever 21 Shop City on Roblox, created by Virtual Brand Group

How does this work in practice, connecting physical and meta-retail?

Now, in the Forever 21 case, when you’re on the brand’s e-commerce site, you see both the real-life and avatar garment, which can be worn in a metaverse. You can firstly save money by choosing a bundled package of clothing that buys both outfits at a discount. Then, if you shop in a physical Forever 21 store, for example, there could be a code on your receipt which, if you collect enough, could unlock a special item or experience on Roblox. It’s a constant loop, back and forth, between spaces.

Consumer behaviour can also be tracked in the metaverse. What type of insights or data are you uncovering?

This is known as spatial data analytics. In the same way you could ask someone to wear a motion capture suit and track their every step through the mall, every item they looked at or walked away from, we are able to track this through our technology in the metaverse. And that data capture, in terms of understanding consumer behaviour, is at an exponential level for brands in that it will lead to new insights and new innovations.

Tell us about R&D in virtual realms. Can you give me an example of using virtual worlds to develop and test products?

Through our VBG Lab we offer two levels of incremental innovation. Firstly, we can adapt and translate brands’ products for the metaverse. The second level is when we build products on behalf of brands, using their DNA but creating something they don’t yet offer. It might be a car brand wanting to offer a helicopter or ski gear in the metaverse. It’s too risky to develop in real life, but we can build those items virtually with low risk. If these items garner high interest or high demand digitally, then these brands may then produce them in the real world. One of our number one sellers in Roblox is an innovated Forever 21 item – and now the brand wants to create a real-life version of it.

‘The beauty of the metaverse is combining virtual worlds and physical stores together through a constant marketing loop, back and forth, between spaces’

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