How and Why Fashion Brands are Going Virtual with Gaming Partnerships
An overview of fashion brands embracing the digital world of gaming in the Metaverse.
Fashion VS Games
Historically, fashion and gaming are two very different worlds. Fashion lives in the physical world, dictated by trendsetters and celebrities. It expresses creativity through garment making, finding a balance between practicality and fantasy. Games live in digital, fantasy worlds that are distant from reality. Gamers are stereotyped to be anti-social nerds at home who don’t care about how they look, a demographic that is typically not interested in fashion. And vice versa for people in fashion.
Entering The Metaverse
In the past couple of years, the spotlight on gaming and fashion partnerships has been increasing, with headlines every week that goes something along the lines of: “Brand X enters the Metaverse…”. The size of the gaming market has been growing rapidly, especially since the internet boom. It is forecasted to reach USD 339.95B by 2027, from $198.4B in 2021. Fashion labels realize that there’s a huge potential in the gaming space — gamers, and more generally, the gaming market. Brands are jumping onto the hype train, from augmented reality, virtual reality, clothing collaborations in both digital and physical worlds, NFT drops, and experiences in digital worlds.
But First, What Is The Metaverse?
Every company or organization has its version of what it means. Facebook, for example, has decided it will embody it to the extent that it renamed itself, “Meta”. In short, the metaverse is a vague definition of the internet’s next evolution — a digital space where you can create, explore and interact with other people. I would argue that by these basic criteria, metaverses have existed for some time now. Some examples are social platforms and online games.
Social Platforms And Hubs
For example, social media platforms like Facebook and Instagram allow you to create and customize your profile — a virtual representation of yourself in a virtual world. It also allows you to interact with other people and their content. A similar category is social hubs. From Habbo Hotel to Second Life, these are platforms where you can interact with communities in a virtual world. Players can host and participate in events, and trade within their virtual economy.
Online Games
Another great example of metaverses is online games, particularly Massively Multiplayer Online Role Playing Games(MMORPGs). Players can interact together with a virtual world, while fulfilling objectives such as fighting, leveling up, and completing quests. World of Warcraft (WoW) is probably the most popular MMORPG. From the choice of race, guilds, playing styles, and exploring the vast worlds and quests to participate in, players choose their own adventure in a fantasy world in games like WoW.
MMORPGs
Before the internet, role-playing games (RPGs) gave players the experience of playing as a character through a story. Then the internet came and supercharged this experience by allowing players from around the world to connect in a digital world at scale, which gives it the term “Massively Multiplayer”. Today, games of all genres give players a sense of freedom and choice beyond gameplay. One of the ways is through customization of how they look like. These in-game clothing, are commonly called skins.
Fashion X The Metaverse
This brings us back to the cross-over between fashion and gaming. Under the loose definition of “Metaverse”, what are some examples of fashion labels “Entering the Metaverse”? A few categories stand out in the metaverse: Experience hubs, clothing collaborations, and NFT drop. Here are a few examples, to name a few in the gaming space.
Experience Hubs
Similar to social hubs mentioned earlier, experience hubs are platforms where people come together virtually to socialize. Events like conferences and concerts are some examples. They can often be categorized together with games as the two can feel very similar and have crossovers. But because they don’t have clear objectives as games do, such as leveling up and completing quests, experience hubs are meant to be a social and interactive experience.
Game Platforms That Also Create Experiences
The lines are also blurred when many game platforms move towards hosting these experiences. Some popular games that have done this are Fortnite, Roblox, and Minecraft, covering experiences such as concerts, exhibitions, and interactive experiences. For example, Fortnite has hosted virtual concerts for artists such as Travis Scott, Marshmello, and Ariana Grande.
Roblox X Gucci
Roblox is a popular gaming platform targeting young children, where players can create and share games and experiences for anyone to play. The game characters often have a Lego-like aesthetic, made with simple and blocky shapes. In May 2022, Gucci launched Gucci Town on Roblox, a virtual experience on Roblox. It is a space where players can play mini-games, shop in a virtual store, visit a virtual exhibition space, and socialize. Previously, it also released Gucci Garden on Roblox. It was reported that a Gucci bag was sold for $4,115, while the original physical version sold for $3,400.
Minecraft X Lacoste
Minecraft is also another popular game that allows customizations of the game platform for games and experiences. It is also very popular with young children, featuring a 3D pixel or voxel art style. In March 2022, Lacoste launched a virtual experience in Minecraft, Croco Island. It hosts various mini-games while being a marketing vehicle for launching its in-real-life 35-piece collection.
Decentraland’s Metaverse Fashion Week
Another platform is Decentraland, a blockchain-based platform similar to The Sandbox. The Sandbox and Decentraland market themselves as decentralized platforms where anyone can create and share virtual experiences, similar to the previously mentioned Habbo Hotel and Second Life, but on the blockchain. In March 2022, Decentraland hosted the very first Metaverse Fashion Week (MVFW), featuring brands like Dolce & Gabbana, Philipp Plein, Estée Lauder, and many more with digital boutiques. Because the concept was novel and the technology was still new, reviews were mixed. But it still shows the future of virtual worlds and where they could be headed.
Clothing Collaborations
Clothing collaborations and partnerships mean that fashion labels create physical clothing based on or associated with the game. And in reverse, games can also create in-game assets or skins that feature the partnered fashion labels. Some partnerships even feature recreations of actual pieces. Fashion brands have also partnered with high-profile gamers and teams to create merchandise, marketing to the fans of these “influencers”.
Animal Crossing
In 2020, luxury brands such as Marc Jacob, Kirin, Sandy Liang, and Valentino partnered with Nintendo’s Animal Crossing giving players access to branded in-game clothing. It seemed like a perfectly timed partnership. Because of the lockdowns, pandemic, and canceled fashion shows during 2020, this virtual collaboration seemed to have been a marketing success for both parties. Players could dress their characters in virtual recreations of the adored brands in the Animal Crossing world.
Balenciaga X Fortnite
In September 2021, high fashion label Balenciaga partnered with the popular battle royale game Fortnite to bring both in-game and physical Balenciaga products. Limited edition merchandise, such as T-shirts, hoodies, and hats, was sold. Players can also purchase skins in the in-game store, which they can use to dress up their characters. Fortnite has been huge on collaborations of all kinds, from musicians like Travis Scott, characters from other games such as Assassin’s Creed, to characters in DC Comics and Marvel. It shows what a Metaverse could look like when you crossover virtual worlds from everywhere.
NFT Drops
Non-fungible tokens (NFTs) are unique tokenized digital assets on the blockchain. The cited use cases for brands to launch NFTs mostly take the form of collectibles, such as art, digital clothing, or membership. Brands can use it to reward holders of the NFTs with airdrops, exclusive access, or the ability to influence future projects. These NFTs can also trade on secondary marketplaces. However, NFTs could also be a speculative investment bought more by traders than by fans.
Burberry
In August 2021, Burberry partnered with a blockchain-based game — Blankos Block Party, built by Mythical Games, to launch limited edition Burberry branded NFTs. These NFTs can be used and played within the Blankos Block Party game. It continued its partnership in June 2022, following up with another edition of NFTs, and also created its own social space within the game for players to connect and explore.
Adam Bomb Squad
Adam Bomb is the iconic mascot for The Hundreds, a very popular streetwear brand. In August 2021, a collection of 25,000 NFTs launched under the name “Adam Bomb Squad”, featuring the well-recognized bomb character in unique combinations of styles and backgrounds. As stated on its website, owning the NFTs give access and perks such as exclusive products and collections, among others. In June 2021, hardware wallet maker Ledger partnered with Adam Bomb Squad. They released an edition of The Hundred branded wallet while gifting holders of the NFTs wallets based on the traits of their NFTs. In August 2022, it partnered with the NFT project Cool Cats, launching a line of physical merchandise — T-shirts, hoodies, and totes. Adam Bomb Squad is an example of a brand that uses NFTs as a great marketing tool to keep fans engaged.
Dolce & Gabbana
In September 2021, Dolce & Gabbana auctioned off a 9-piece NFT collection for a record total of $5.65m. “Collezione Genesi”, which means genesis collection, included three crowns, three jackets, two dresses, and a full suit designed personally by Domenico Dolce and Stefano Gabbana. Bid winners not only received the NFTs, but also physical versions that will be tailored, and exclusive access to Dolce & Gabbana events. It showed the luxury fashion label to be a leader in the space, specifically in digital couture garment creation.
The New Virtual World
These are just a few examples. There are many brands in different categories — from luxury to streetwear, fast fashion, and sportswear — participating in the “Metaverse”. It shows the range of possibilities in a new digital world.
The Cross-over Between Digital And Physical Fashion
As we’ve seen, fashion brands are embracing this new space, merging the physical and virtual worlds. In-game clothing gives players a sense of freedom and choice. They allow players to customize how their characters look in the virtual world. Skins can be purely cosmetic, which only affects how a player looks in-game, or it can be items such as armor and weapons which affects gameplay. Whether in a physical or virtual world, people still have the same emotional drives when it comes to how they look. Utility, self-expression, and social signaling.
Utility — Practical Purpose
Clothes have a practical purpose. They protect us from the elements, such as keeping us warm and providing us with modesty. In the same way, most skins in games have a utility. They can provide the wearer’s character with armor, protection, and in-game power-ups. This can affect how a player’s character looks. Other times, they are cosmetics only and do not affect gameplay, which is commonly referred to as skins. This brings us to the next point — self-expression.
Self-expression And Unleashing The Individual Creative
Self-expression plays a huge role in both the real and digital worlds of fashion. For example, the clothes you chose to wear today, reflect a certain way of how you express yourself, and how you want to be seen by others. Fashion is a form of creative expression, allowing people to show different sides of themselves.
Brands — The New Culture
Clothing can also represent different cultures and history — ethnic clothing and military clothing are two examples. Today, clothing with culture and history is represented more so by brands. Fashion labels not only sell clothing but market and sell the brand and narrative behind the clothes. Consumers express their association with these brands through what they wear, or what it represents and signals to people around them. The same applies in the virtual world. Games allow players to customization, giving them the ability to express themselves in the same way as in the physical world.
Social Signaling
In-game assets, including clothing, are a way for some to flex digitally, or show a certain status. Some game items are hard to get — signaling that this player has spent lots of time and energy, or skill to obtain them. In the real world, flaunting certain brand names signals that you have the disposable income to spend on such high-ticket items, and in the same way for certain games, it could say how much a player has spent — whether real-world money or virtual currency — just to look a certain way. Or, it could show that they were around for a one-time event, and the items were limited to that period, showing off that they were here when it happened.
Signaling Association With Brands
Clothes are also a way that people have used to signal status or show your identity or association. When brands partner with games by introducing branded skins to players, it does two things: It allows players who are fans of the brand to show off their virtual selves with their favorite brands. For brands, it spread awareness into a new market. It then spreads awareness for these brands into a new market, not usually associated with the brand.
From A Business Perspective
Adapting these new digital experiences comes as a business decision. It should drive both sales and marketing. Brands can continue to sell mirrored products in parallel virtual worlds, similar to products sold in the physical. As a marketing vehicle, it can reach out to potential customers in a new space, increase the overall awareness of the brand, and engage existing loyal customers of the brand.
Marketing And Branding Vehicles
In the short to medium term, both brands and gaming platforms benefit from such partnerships as a way to cross-promote and tap into the customers of both parties. It also raises the overall perception of the brand, to say that this brand is at the forefront of adopting new technology.
Growing Up With The Demographic
Partnerships in this space can be a difficult business decision to understand. For example, why would Gucci, a luxury fashion house whose prime demographic is consumers much older and have more spending power, partner with Roblox whose players are mostly 12 or under, to create experience hubs? Brand awareness is a long-term decision.
McDonald’s, as an example In the fast food business, uses marketing strategies such as Happy Meals toys and very appetizing foods to attract young children. Such moves are made to grow up with their future target audience by starting young. They cultivate positive feelings and happy memories associated with the brand so that when these children get older, they continue to remember and come back to McDonald’s.
Revenue Channels
More as a marketing vehicle, business moves like these may not convert to sales immediately, especially after subtracting the cost of creating and marketing digital assets. That said, virtual assets can be sold in parallel with the physical world, in the virtual world.
Scaling Production And Being Cost Effective
One of the benefits of selling digital assets is that production costs can be reduced, and the distribution can be scaled easily because these are digital products. For example, it only takes creating one 3D asset, to potentially sell or market at a minimal cost. Compared to physical goods, production requires the same cost for each piece and is reduced when higher quantities make it more efficient.
Unique And Trackable Assets
Because information is stored digitally, and on the blockchain, another benefit of selling digital assets is that brands can track and analyze their sales or uptake more accurately. Some brands can make trading on the secondary market available, allowing them to take a cut of all secondary sales. Finally, because these digital assets can be tracked, they can be used as a way to reward holders and keep fans engaged through membership privileges. These can include exclusive access to events, discounts, and releases. A good example, as mentioned earlier, is how The Hundred does it with Adam Bomb Squad.
Considerations — A Virtual Transformation
Brands need to consider several factors when moving to the virtual world. First, what are the new processes, infrastructure, and talents needed to market and sell these products? Without the right expertise, errors can cause huge problems. In the blockchain and cryptocurrency space, hackers exploiting vulnerabilities have caused huge losses of funds. Such issues can create PR disasters, and affect the brand image.
The Environmentally Responsible Narrative
Two — some call this move to virtual clothing a way to be more environmentally responsible. On the surface, selling digital clothing is easier to scale, while manufacturing clothing produces a lot of waste such as material, dyes, and the high turnover of fast fashion. Would this be true for the business and is this a narrative that your brand should consider? And does virtual clothing have the same utility as virtual clothing?
The Reversal
Finally, what are the downsides of not participating in this transformation? Businesses should not ignore the backlash from consumers when it comes to the “Metaverse”, NFTs, and cryptocurrencies. Many are against the move into this new space, with reasonable arguments to back them up. Would your brand benefit more from the increase in brand perception, or be more negatively affected by pushback from communities?
Additional Thoughts
This post may have painted the “Metaverse” and such partnerships in a positive light, but we should remember that many of these projects happened during the pandemic period from 2020 to 2022. This was a time when many people were forced to stay at home, which could have contributed to more online activity.
Just like how fiscal stimulus could have driven retail trading and the cryptocurrency price boom during the same time, it was a time when staying at home meant more digital and virtual activities. Many people could not spend their money on anything outside of the home, such as recreational activities, eating out, and traveling. Instead, they had to spend it online or could speculate in the financial markets if they did not save it.
Could this have been the main reason behind the NFT market boom and bust in terms of trading volume during the same period? As people return to normal, and with no more stimulus money, will we see less consumer appetite for such digital experiences over the next few years?
However, I think the overall potential of such partnerships is still valid, it just means that it may be over-hyped for now. If this was a pandemic-driven boom, then we may see things slow down for a long time. Remember that since the burst of the dot.com bubble, the Nasdaq took about 16 years to reach back its highs in 2000.
