Introduction

On November 13 and 14, 2020, American rapper, singer, and songwriter Lil Nas X, also known as Montero Lamar Hill, appeared on the virtual stage on Roblox, the global gaming platform especially popular among children. As a first for Roblox, the concert attracted an incredible 33 million attendees, enjoying a unique performance inside the virtual world.3 For Lil Nas X, who is often regarded as a trailblazer, the virtual concert provided a unique opportunity to connect with millions of his fans when physical shows were not possible due to the pandemic. While in-person concerts are capped by the capacity of the stadium and the laws of physics, anything is possible at a virtual show to wow fans, and they can offer a magical experience. Lil Nas X debuted his new single Holiday during the concert, and by all measures, the virtual show was a massive success. It generated a lot of publicity for both Roblox and the rapper, launching a new entertainment format for Roblox and generating almost $10 million in virtual merchandize such as digital costumes, accessories, and avatar skins, which users could purchase using the in-game currency Robux.4

Lil Nas X appeared as a larger-than-life digital twin and transported users to four different themed worlds, from the Wild West to a Wintery snow-filled world. Roblox's users regarded the unique experience well. Though some children would have wanted to watch the show alongside their friends, it was impossible to bring together all 33 million attendees on one server due to the current hardware constraints. Above all, it would have been utterly chaotic. Hence, players saw only around 50 other attendees watching the live performance, making it feel a bit empty. Apart from the occasional glitches expected from such a novel experience, the concert was a blazing success.

Less than a year later, in October 2021, Decentraland organized not just one concert but an entire, four-day metaverse festival with 80 different artists.5 Decentraland is a fully decentralized 3D virtual world controlled by a decentralized autonomous organization (DAO) where users can build their own unique digital experience and interact with others. The biggest drawcards for the virtual festival were Deadmau5, a Canadian electronic music producer and DJ, and Paris Hilton. Roblox and Lil Nas X targeted its young players, while the Metaverse Festival was focused more on the tech-savvy crypto community. Users could purchase digital merchandise using the in-game's crypto MANA, such as digital wearables for their avatars,6 and all attendees received a nonfungible token (NFT)* in their wallet as a Proof of Attendance.7

When you started reading this book, you might have wondered why does a business book on the metaverse start with a fictional story and discussing two virtual events? Am I in the right place? Well, yes.you certainly are. The two concerts, and the many other concerts that have taken place in games such as Fortnite,┼ show that the lines of the real and virtual worlds are starting to become intertwined experiences working in tandem. The fictional story shows what the metaverse can become, and it won't be long before we live in such a future. In its most basic form, the metaverse is where the physical and the digital worlds converge into a phygital experience, augmenting both the virtual and the physical worlds. As we will discover, the metaverse will radically change our society and offer experiences that until recently would have seemed magical. The first glimpses of the metaverse can already be experienced, and people around the world are living, experiencing, and exploring it. In the coming decade, the metaverse will come alive, and it won't be too long before unique hybrid experiences will become a (virtual) reality.

Welcome to the Metaverse

The rise of these massive interactive live events (MILEs) is a first indication of where the internet is heading and the opportunities that come with the next iteration of the World Wide Web. Who would have thought a few years ago that 33 million people could attend a concert at the same time? All could experience it from the best possible vantage point and sharing that experience with friends who are scattered across the globe, creating collective memories in times when physical connections were not possible. Online entertainment and socializing in virtual gaming environments are very normal for Generation Z (those born between mid-to-late 1990s and 2010) and especially Generation Alpha (those born after 2010), even before the pandemic hit.

Already, Generation Alpha, the first generation to be born entirely in the 21st century, will have a completely different perspective on the (digital) world than previous generations. These kids are born in an age when the iPad was introduced, Facebook became the dominant social network, and massive multiplayer online games (also known as MMOs) attract millions of players. You might be familiar with the 2011 video of a one-year-old baby easily navigating an iPad but struggling with a paper magazine because she couldn't pinch and zoom. To her, the magazine was broken.8 Although Gen Alpha is, of course, also very familiar with physical artifacts such as children's books or coloring books, the fact that these children can so easily navigate the digital realm from an early age is an indication what we can expect as their brains are wired for the digital world from the start.

Ten years later, the baby has grown up in a world where the internet is everywhere, always available at the push of a button, and online interactions are as normal as physical interactions. She looks at the world from a completely different perspective than Millennials, let alone the Baby Boomers who currently run the world. As such, she feels very comfortable immersing herself in a virtual world with endless possibilities and opportunities, despite all the problems that come with that, as we will see later in the book. To her, the metaverse has always been here, and the more advanced our (digital) technologies will become and the more the physical and the digital merge, the better she will be able to navigate this so-called phygital world.

One of the amazing new experiences that the metaverse has brought already is these massive interactive live events. To Generation Alpha, these MILEs offer substantial benefits over real-world concerts. First, they are easy to attend. Children do not need to ask for permission from their parents because they don't have to go anywhere. They can attend from the comfort of their home. Second, they can appear at the concert in their favorite outfit or character, using the avatar as an extension of their real-world personality, creating the ability for the ultimate self-expression. If your child feels like going to the concert like a unicorn, they can, and it probably doesn't cost the world to be a unicorn either. Next, their friends from around the world will also be at the concert. Note here that Generation Alpha has friends from all over the world from the start. They have made close friendships with people they might have never met in real life and probably never will meet physically. To them, globalization is not something that is bad, but an opportunity to meet new people and learn more cultures, albeit completely virtually. Finally, they will have front-row seats at the concert, even if they happen to be late for the show. In fact, they can stand next to their favorite singer while he or she is performing, taking a screenshot of the experience and sharing it with their friends who could not be there. Once the concert is over, your children are already home in time for dinner. The best thing is that next week, they can go to another concert, without paying $100 for an entry ticket that allows them to see their favorite artist from afar in the physical world. For many children, the virtual concerts offer as good an experience or even a better experience than traditional physical concerts.

The metaverse will provide benefits like these interactive concerts and many more as portrayed in the fictional start that will be hard to ignore for both consumers and organizations. The metaverse offers a new way of doing business, connecting with customers, and collaborating with colleagues. As we will see, those companies who have already stepped into the metaverse are already benefiting from it, creating increased brand loyalty, optimizing product design and creation processes, becoming more sustainable, and generally increasing their bottom line. Similar to those companies who were first to adopt the internet when it appeared in the 1990s and those companies who were first to venture onto social media when it appeared in the late 2000s, those companies who have already entered the metaverse will reap the benefits from this new trillion-dollar social economy that will be created this decade.

However, as we will also see, it is not business as usual in the metaverse. Yes, the immersive internet is another channel that you need to master as an organization, but it is a channel that requires your full attention. It will require significant up-front investments, trial and error, and strong connections with your community. After all, designing a series of nonfungible token (NFT) collectibles related to your brand or creating an immersive digital version of your headquarters for your customers to explore during the pandemic is a lot more capital- and resource-intensive than creating a social media campaign. In addition, "datafying" processes and embedding operating equipment with...