The Metaverse, Commerce Anarchy, and Tech’s Long Road



The opportunity for fashion and other brands and retailers in the metaverse may be somewhat vague, but figuring it out has become an imperative since Facebook pivoted from social media giant to metaverse company, now called Meta.

Chief executive officer Mark Zuckerberg wants to leave behind the 2D internet of today and build immersive shared virtual environments that can feel both magical and realistic — “​​where, with just a pair of glasses, you’ll be able to step beyond the physical world,” he has said.

This vision is grandiose, and it will take years to flesh out. But the promise already has companies racing to embrace this new form of internet.

In retail, that effort may come with steep challenges, warned Marcel Hollerbach, chief information officer at product data management firm Productsup. He believes diving headfirst into metaverse commerce will add complication that exacerbates the existing conundrum of omnichannel retail.

Forrester Consulting mapped out the struggle for retailers in its “The Future of Commerce Technology” report: They’re told to “optimize everything, including their product content, processes and operations in each channel.”

While companies work on that, they’re also staring down intensifying consumer expectations for a “personalized, consistent and single experience with a business across all touchpoints.”

It’s a contradiction, and businesses can’t keep up, resulting in “commerce anarchy,” the firm said.

Productsup, which commissioned the study, sees the metaverse amplifying the chaos.

“Facebook’s push toward building the metaverse will have a huge impact on supply chains,” Hollerbach told WWD. “In a metaverse future, even more channels will exist for suppliers to connect with shoppers, and those channels will update their selling features even more frequently. Additionally, the flow of product information will speed up significantly, moving nearly in real time.”

He pointed to an example: If, say, Nike offers a unique NFT across “multiple metaverse touchpoints,” he said, “it will have to update the availability and price in real time across all platforms.” That’s not as easy as it sounds. New channels may pop up more frequently and change constantly, with new features that may involve coding or new catalog formats, while the velocity of data moving through the company’s “value chain” accelerates.

Extrapolate that to a larger assortment encompassing virtual goods and perhaps even physical counterparts, across a variety of platforms, and the scale of the problem comes into view.

A global brand like Nike may feel confident about handling that — indeed, the sneaker company already appears to be preparing for the metaverse. It just registered trademarks related to “downloadable goods…for use online and in online virtual worlds,” the U.S. Patent and Trademark Office filing read.

But that’s only one step in the kind of multitiered strategy that metaverse success would require. The next step looks like NFTs.

This year, non-fungible tokens have become hot properties, with releases by everyone from Taco Bell to Clinique, Dolce & Gabbana and Gucci. But because of the intrinsic nature of the blockchain-based tech — which allows for authenticated, and therefore rare or exclusive, digital fashion and other virtual or physical products — it’s viewed as a gateway to commerce in the metaverse.

Now there’s a gold rush of hopefuls racing to set up shop, while others try to break ground on infrastructure to make metaverse shopping viable.

For instance, Bitski, an Andreessen Horowitz-backed “metaverse commerce platform,” just rolled out credit card-based NFT sales on Tuesday “to kickstart economic activity in the metaverse,” according to CEO Donnie Dinch. Last week, Dreamium Labs introduced its NFT-oriented Dreamscape Open Metaverse. The platform turns selfies into full-body “mini” 3D avatars and offers blockchain accounts with an NFT identity system within its so-called “miniverse” environment.

It’s not clear if Dreamscape will connect to Zuckerberg’s metaverse, or if Bitski will work with its platforms, as tech giants tend to favor their own payments systems. (Notably, Meta just unveiled custom web links, so creators can sidestep Apple’s 30 percent cut.) Nike’s trademark seems universally applicable to virtual worlds, but it has yet to be tested across any and all metaverses.

That’s worth pointing out, as Meta won’t be the only one.

Another tech titan just signaled its intentions: At the Microsoft Ignite conference this week, the Redmond, Wash.-based company revealed that Microsoft Teams will support 3D avatars and immersive meetings, and a December preview for the new Dynamics 365 Connected Spaces will show how it blends the metaverse and artificial intelligence for businesses.

“The metaverse enables us to embed computing into the real world and to embed the real world into computing, bringing real presence to any digital space,” said Microsoft CEO Satya Nadella. “What’s most important is that we are able to bring our humanity with us, and choose how we want to experience this world.”

In comments to the media, the Microsoft CEO pledged that his Xbox division will also “absolutely” bring the metaverse into its video game business.

That could give Facebook — er, Meta — some stiff competition. Microsoft has experience building for mixed reality through games like Minecraft and its HoloLens headset for businesses. It’s also recommitted to commerce, having launched a dedicated cloud business for it early this year.

In a January blog post, Shelley Bransten, a former Salesforce executive turned Microsoft vice president in charge of global retail, explained that Microsoft Cloud for Retail will address the industry’s most urgent priorities, while “future-proofing retail organizations to proactively be ready for what’s next.”

Apple has been promoting augmented reality as the next big thing in computing for years, and it’s expected to release a mixed reality, AR or VR face-worn device in the near future. That would likely come with software and a platform for those experiences. Its fellow Silicon Valley denizen, Google, showcased Project Starline in May. Through its hologram project, it developed realistic 3D video calling with a “magic window” that lets people far away feel like they are in the same room.

Massively popular games like League of Legends, Roblox, Fortnite and others already offer sprawling virtual, shared environments, and they regularly strike partnerships with fashion brands such as Louis Vuitton, Vans, Stella McCartney, Gucci, Balenciaga and more.

Amazon has remained conspicuously silent on the subject, though some tech experts suspect it may be quietly working on virtual or AR technology.

So far, the “embodied internet,” as Meta called it, looks more fragmented than cohesive, with multiple, siloed metaverses and no real idea of if or how they would snap together. But they would have to someday, for the concept to function at the vast scale of the internet that people know today.

If it follows the trajectory of mobile platforms, the choices could coalesce into a couple of major options run by one or two tech overlords who control everything, including fees, revenue sharing and other details. The America Online model may see one dominate early and rule over a large domain, only to crumble in the face of a more open and more chaotic worldwide metaverse web.

YouNow CEO Jon Brodsky sees it less like iOS or Android, or AOL for that matter, and more like Second Life, a virtual world popular in the early 2000s where people roamed around as avatars, built or bought virtual homes and other goods and met friends. Users created accounts and navigated the environment on their desktop computers.

“I still remember, many jobs ago, when I was told that Second Life was going to be the future. And it was, for about six months,” he said. “Or when Magic Leap was going to change the whole world — until it didn’t.”

Second Life, developed by San Francisco’s Linden Labs, peaked roughly 15 years ago, even landing avatar Anshe Chung, the world’s first virtual millionaire and real estate mogul, on the cover of Businessweek magazine.

Magic Leap was a hotly hyped mixed reality hardware-maker backed by giants like Google and Alibaba whose concept — which beamed visuals directly into the eyes — stoked excitement. But the reality failed to gain traction. One device launched to disappointing reviews, killing the buzz and prompting the company to ditch consumer plans and target the business crowd.

Both outfits are still around, perhaps hanging on long enough to see metaverse buzz resurrect them. Last month, Magic Leap scored $500 million in more funding to build another AR headset.

But such experiences have jaded technologists like Brodsky. He chafes every time he hears the word “metaverse” now, because what he hears “sounds to me like a bad episode of ‘Star Trek: The Next Generation.’”

From his position running a social media platform for livestreamers, the tech executive believes that “what is sorely missing from my algorithm-driven, heavily filtered competitors is that people are wildly different, and that the internet used to be phenomenal about exposing all of us to those differences. When the things that separate us are the color of our avatar’s coat, we’ve lost something essential.”

The critique might as well land on Zuckerberg’s door. Facebook’s algorithms have drawn heat for their role in amplifying misinformation and disinformation, even mental distress, just so it can sell ads. That’s led critics to wonder, if one can’t trust Facebook’s current platform, why should they trust an even more immersive version of it?

Rep. Alexandria Ocasio-Cortez summed it up in her viral reaction to the Facebook company’s name change, tweeting “Meta as in ‘we are a cancer to democracy metastasizing into a global surveillance and propaganda machine for boosting authoritarian regimes and destroying civil society…for profit!’”

The large, existential cloud hanging over Meta won’t go away anytime soon. But people like Hollerbach are focused more on the nuts and bolts of the metaverse, regardless of whose version of it becomes standard or the yearslong journey it will take to arrive. Retailers should use the time to get ready, he said, so they shouldn’t wait to optimize the way they manage their product data.

“As a brand you need to reach consumers, but if you’re already struggling with that today, how are you going to handle that in an entirely new medium?” he asked. “Hyperscalers born in the cloud will get it quickly, but more traditional retailers need to start thinking about [it].”