Yahoo Finance Building Blocks: Embracing the Metaverse – a new frontier for financial brands
Every week Blockchain Sensei will be walking you through the basics of blockchain technology. Consider this your crash course in all things web3!
HSBC, Fidelity, UAE’s Commercial Bank International and South Africa’s Nedbank have all launched 3D virtual experiences in the metaverse.
The term “metaverse” might still sound like a futuristic buzzword, often mentioned by a few trailblazing brands targeting the Gen Z demographic. However, this trend is rapidly growing, with more companies and entities making significant moves in the “metaverse.” As professionals in finance and banking, particularly those in the City of London, it’s crucial to understand what the metaverse is and why it matters to us.
The metaverse is an immersive digital shared space where gaming often serves as a gateway. It can be accessed via mobile phones, laptops, or through a fully immersive experience using VR (virtual reality) glasses. This digital universe is composed of various platforms, including centralized Web2 environments like Roblox and Fortnite, and decentralized Web3 platforms such as Sandbox and Decentraland. Each platform offers unique opportunities for brand activations, and the choice of platform depends on company goals.
With the largest transfer in wealth currently underway, Millennials and Gen Z are far less likely to want to make repetitive visits to see an asset manager or accountant in the city when they can purchase and liquidate assets from the comfort of their own home. This is heightened by the fact that blockchain technologies allow the purchase and transfer of assets, including tokenized stocks and now real estate, to be done in seconds. Traditional finance needs to find ways of attracting and retaining younger clients who are inheriting wealth in abundance.
The most compelling reason for brands to engage with the metaverse lies in its audience—particularly Generation Z (ages 14 to 28). This demographic is becoming increasingly significant for brands. Gen Z are digital natives, with 88% of their online population being video game players. They spend 17% of their leisure time gaming, nearly matching the 23% they spend on social networks (Newzoo reports 2022 and 2024).
Some financial brands such as JPMorgan and HSBC have already taken a proactive approach and own digital real estate in the metaverse platform The Sandbox. The real advantage for entrepreneurs is not just the time spent, but the level of engagement. Unlike the passive scrolling typical of social media, gaming offers a highly engaging experience. Users immerse themselves in gameplay, complete missions, and interact with peers in a gamified environment. This has been done by ING bank who have created an immersive banking experience in Roblox.
Consider the statistics from Roblox, a leading metaverse platform with 70 million daily users. Users spend an average of 2.3 hours daily on the platform. In comparison to the average daily sessions on Instagram (33 minutes) and TikTok (52 minutes). The Gen Z demographic is also the fastest-growing user segment on Roblox (Roblox report 2023); exceeding reach and traffic of almost any radio, billboard, or TV ad.
This presents a tremendous opportunity for brands to forge deeper relationships with current and future customers in a dynamic and engaging way. Brand advertising and endorsements within gaming environments offer new avenues for brand discovery. This trend is evident across various sectors, including fashion, sports, beverages, fast food, and increasingly, financial services.
The metaverse can be leveraged to create innovative marketing campaigns, engage customers in new ways, and integrate e-commerce solutions seamlessly. The connections between gaming and real-world products and services are growing stronger, making it essential for companies to consider this channel.
As leaders in the finance sector, it’s imperative to recognize the potential of the metaverse. It’s not just a passing trend but a burgeoning landscape that promises to reshape how brands connect with their audiences.
(Interested in learning more about blockchain’s real world use cases? Join CML Academy today 2pm EST/7pm BST for a virtual session! Sign up and more info HERE)
