3 business models that will succeed in the metaverse
Two of which are centred on content-driven experiences.
By 2030, the metaverse could be worth around US$3tn to US$10tn and would make up 10%-40% of the digital economy, which is why it is expected that more players will enter this new realm.
For those planning to enter the metaverse and succeed in the space, DBS head of telecom, media and technology research Sachin Mittal said there are three business models which they think can help them achieve such a goal.
First, Mittal said businesses should incorporate the metaverse into their existing business models to drive competitive differentiation. One way to do this is by virtualising a production line or a sale demonstration.
The second business model is creating or orchestrating new experiences in the metaverse. Examples of this are gaming, high-risk exploration, and social engagement.
These two models focus on "content-driven experiences."
"The premise of the metaverse is an experiential offering engaging a wide band of human senses. Yet those senses need to be engaged in a way that sparks the imagination. Successful metaverses will be those with superior, immersive, and engaging content," Mittal said.
For these two types of models to remain sustainable, Mittal said companies must continuously create content that is engaging to customers.
"It also follows that just focusing on enabling a virtualised experience is insufficient. It must drive a deeper underlying job to be done," the DBS analyst said.
"An example would be a manufacturing process that is made better because of virtualisation or a virtualised hands-on test of a new car’s limits without the risk of a high-speed crash," he added.
The last business model which DBS suggested is for players to provide underlying infrastructure and components of the metaverse.
"A human-centric approach starts with the conceptualisation of the intended experience. Following which, the technology that can best deliver this experience is determined," Mittal said.
"This results in the content owners and providers having the commercial power to decide the technology infrastructure to be used, much in the same way Disney+ introduced competitive pressure to
Netflix," he added.