What: The FT makes a panorama of the recent luxury initiatives in the metaverse.

Why it is important: It is easy to see these initiatives as gadgetty today, however in doing so brands are acquiring precious understanding and knowledge of the market mechanisms, which will prove crucial once the trend develops (without knowing however when this will take place).

The Financial Times reviews the initiatives led so far by luxury brands when it comes to interacting in the metaverse. According to Goldman Sachs, the potential of this market could reach $8 trillion in 20 years, but this is still far away in time and it is easy to be sceptical about this opportunity. Luxury brands are eager to be in the game in order not to lose a potential opportunity. Overall, the initiatives can be classified as:

-    A way to sell a digital double at a lower price point (Forever 21, Gucci, Burberry), in the form of a NFT or a skin, coming with a physical version of the product sold at regular luxury price points,

-    Augmented reality collaborations, with 3D versions of products being available on smartphones allowing customers to try them before purchasing them (Estée Lauder, Mac, Gucci and Dior all teamed up with Snap to do so),

-    NFTs linked to the collection or the brand, sold at a particular price point and giving access to exclusive perks (Tiffany’s).

However, everything is not rosy: it is difficult to control brand images in the metaverse, in addition to potential risks to IP and trademark, as shown by the recent trial opposing Hermes and a digital creator about virtual copies of its iconic bags.

What Gucci and other luxury brands learnt from the metaverse