Move over traditional fashion weeks. The next major fashion industry showcase may be entirely virtual. Metaverse platform Decentraland announced on Sunday that it will host four days of “catwalk shows and showcases, pop up shops, after parties, and immersive experiences” in March 2022 in collaboration with Polygon blockchain-hosted luxury marketplace UNXD, the company that recently played host to Dolce & Gabbana’s first NFT clothing collection. “Have your collections ready!,” Decentraland asserted in a tweet on December 26, teasing its virtual fashion venture, which will take place between March 24 and 27, and will enable consumers to view the runway presentations, engage with other viewers, and purchase the virtual garments and accessories for their online avatars.
The newly-announced metaverse fashion week comes as brands are rushing into the metaverse (i.e., the digital universe in which users can engage by way of a combination of tech advancements, including virtual reality, augmented reality and video) in order to reach an increasingly sizable pool of consumers. For a sense of the numbers at play: Gaming platform Roblox, alone, where Gucci launched its “Garden” experience this spring, boasted almost 50 million daily active users as of August, up from 41 million in May, and no shortage of them fall into the prized Gen-Z demographic (those born between 1997 and 2012).
Meanwhile, Epic Games’ blockbuster title Fortnite has a player base that averages at around 4 to 8 million per day. Unsurprisingly, the game has attracted attention of fashion brands, including Balenciaga, which followed up on the Afterworld: The Age of Tomorrow video game that it launched to showcase its Fall/Winter 2021 collection with a tie-up with Fortnite in connection with which the two companies have offered up both in-game apparel and accessories, and physical merch.
In addition to the pure game-play aspect of this burgeoning new ecosystem, no shortage of metaverse participants are eager to connect with one another to socialize and to dress the part. In a report this summer, website-building and e-commerce platform Squarespace found that of the 2,000 U.S. consumers that it surveyed, many placed significant emphasis on their how they appear online. Specifically, Squarespace revealed that 60 percent of Gen-Z and 62 percent of Millennials (those born between the early 1980s to the mid-1990s) believe “how you present yourself online is more important than how you present yourself in person,” a sentiment that not only applies to social media but that neatly translates to elements of the metaverse.
Against this background, the metaverse is not only a new medium for brands to advertise to engaged consumers, it stands to be a very lucrative place to sell virtual garments and accessories, and if early-adopters Clinique and SK-II have a say, cosmetics and beauty products, as well.
The amalgamation of various Web3 applications is being characterized as a $1 trillion opportunity for companies involved, and the potential for fashion-related revenue-generation is already underway. According to a recent report from Bloomberg, the likes of Gucci, Balenciaga, and Burberry are already generating millions of dollars in revenue from high-margin, digital-only designs, with the publication’s Mark Ellwood stating that with “no raw materials to buy, and minimal labor, virtual clothes are almost all profit” compared to their physical counterparts. More than that, Ellwood notes that “any company with decades of archival designs can convert that intellectual property into a new revenue stream, reissuing pieces as metaverse-only … with minimal investment.” (As TFL noted this spring, the wake of the pandemic may be an opportune time for companies to assess the breadth of the assets in their portfolio and try to monetize their brands in ways beyond their current uses, such as in the metaverse.)
The metaverse is also a space for brands to offer up sizable volumes of branded goods in furtherance of their enduring quest for revenue growth, and to possibly do so without the the risk of dilution that tends to follow from market saturation. In other words, at least some of the limitations placed on brands in the physical world may not exist (or may exist to a far lesser extent) in the virtual world.
Given the consumer interest in the various seasonal fashion weeks, which have not yet returned in full-force from pandemic-related limitations, and the desire for brands to advertise themselves and their offerings to consumers in a medium where consumers are actively engaged (as indicated by the rate at which brands are seeking out trademark registrations and in some cases, dedicating entire departments to accelerating their metaverse activities), Decentraland may not be the only brand looking to stage a metaverse fashion week and corresponding runway shows. In fact, it might not be long before the respective fashion week organizers – from the Council of Fashion Designers of America to the French Fashion Federation – and brands, alike, look to adding an entirely-virtual element to their otherwise physical events.
Oh and if Decentraland sounds familiar in a fashion context, that is likely because it sold off a 6,090 square feet parcel of virtual land on its platform to crypto investment company Tokens.com’s Metaverse Group subsidiary for $2.4 million – in crypto – in November in furtherance of what has been called one of “the largest ever virtual land acquisitions.” Located in the Fashion Street District of Decentraland, an Ethereum-powered decentralized 3D virtual reality platform, Toronto-based Tokens.com revealed that the real estate will be used “by fashion brands to advertise, host fashion shows, and have e-commerce storefronts, staffed by virtual staff.”
UPDATED (January 4, 2021): It turns out, the Fashion Week events will take place on Tokens.com’s virtual land. In a statement, a rep for Tokens.com told TFL that it has “entered into a lease agreement with Decentraland to host the highly anticipated Fashion Week on its virtual property,” with the agreement including “Decentraland developing the land with virtual towers, fashion tents and runways in preparation for the event.”
“The metaverse is going to impact nearly every type of consumer technology including social media, gaming and fashion. Metaverse Group, our subsidiary, is at the forefront of this evolution. Our collaboration with Decentraland validates our thesis of becoming virtual landlords and being able to generate returns from our NFT properties through immersive experiences for users,” Tokens.com CEO Andrew Kiguel stated in connection with the announcement.