Senior Client Partner, Global Technology Markets, Global Sector Leader, Software
Meta-what? A Primer for Executives
The news is everywhere. Microsoft announces plans to buy Activision Blizzard for $70 billion, in a move widely seen as an old-guard tech company doubling down on its long-term position in the metaverse. A-list accounting firms — not the business sector you think of first when envisioning the future of technology — are snapping up metaverse real estate for $35,000 a pop.
And in the middle of it all are many corporate leaders, asking the question: Meta-what?
Despite all the recent attention paid to the metaverse, an online world that combines aspects of social media, online gaming, augmented reality, and virtual reality to allow users to interact virtually, most companies are trailing behind — so much that when asked how competently firms are handling metaverse matters, experts chuckle. “The pandemic up-leveled the entire globe in digital capacity,” says Leila Lance, Global Technology market advisory leader at Korn Ferry. “So, if your company doesn’t have the talent, and you don’t have a strategy, and you haven’t made investments to keep up with just the last two years, it will get exponentially harder. It’s going to move fast.”
Catching up will be increasingly uphill because metaverse strategy is not just about scooping up some virtual real estate but also about privacy tactics and managing heavy data flows and operational details that can be complex. Leaders are not yet on the train. “Most organizations are far from ready to understand the implications and possibilities,” says Michelle Seidel, global account leader for high-tech at Korn Ferry. The situation is similar, some say, to the transition businesses had to weather 25 years ago with the worldwide web, providing general guard rails and best practices for how to proceed. Here’s a short primer from our experts.
Remember how people and companies snapped up URLs by the dozens (or hundreds or thousands) in the late 1990s and early aughts? The same is happening now with the metaverse, which will evolve into a three-dimensional, multilayered internet. “Claiming that space and name-brand position is important, and no different than it was with internet space,” says Lance. Yes, the current foot traffic is very young, mostly millennials and younger—but they will age and become tech-savvy middle-aged consumers, just as happened with the internet.
Company tech departments of yore handled matters internally. Today a good strategy is to create an in-house role that directs metaverse strategy — likely under the purview of the chief strategy officer or chief growth officer — and to otherwise outsource most components and transactions. “My guess is that external companies will shepherd us into the metaverse and then represent us there,” says Lance.
A good question to have a strong answer to is, What does this mean for my customer? The customer’s metaverse experience is likely to become incredibly rich and engaging, in an environment with rather high levels of texture and intimacy. “You can add value for your customers in ways you can’t even imagine, and be with them 24/7,” says Chris Cantarella, global sector leader for software at Korn Ferry.
Cantarella also cautions companies not to get too caught up in current technologies. “They come and go,” says Cantarella. Remember Netscape? “Things that are hot today might not even exist.” Right now there’s not one cohesive metaverse; it’s many organizations running different pieces.
You know how some company websites are four pages of light information, and others are flashy, seven-figure experiences? The same will hold in the metaverse. A good question to ask yourself is whether your firm should be a presence, an experience, or even more? “Some organizations will actually go beyond experience to where it becomes an integral part of people’s lives,” says Seidel. The further down the spectrum you go, the larger the investment required, in talent and in areas such as blockchain and virtual architecture.
Buying digital land is pretty much always a good strategy, say experts. Companies like McDonald’s, Starbucks, and Google all moonlight as real estate companies. “Why buy?” asks Lance. “Once you actually own metaverse land, you can become anything. If you don’t, you are reliant on renting, and that’s never a good strategy.”