Fashion in the Metaverse: How Brands Monetize Digital Apparel – Style

The luxury industry suddenly seemed pretty old to the nobles. It’s not a good look for an industry that draws no small part of its raison d’être from the future—that is, from claiming to know almost exactly what people will want to wear tomorrow. Back then, designers and CEOs were wildly wrong in their predictions of how and where they would buy what they wanted. In the beginning, “e-commerce” was so frowned upon in the fashion world that it always sounded like “eeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee of of of my in the wrong way.

As you know, things turned out differently. At least since the pandemic, even luxury watches have been ordered online as a matter of course. Mytheresa.com, the branch of the Theresa department store in Munich, now has a turnover of more than 600 million euros with luxury brands. The labels themselves are moving quite slowly, in 2014 almost 40 percent of luxury brands were still not sold online. To this day jokes are made about digital late bloomers.

Just don’t let it happen again. That’s why luxury brands, by their standards, were early when the Metaverse was declared the dimension of the future. No one could really define the key word at first, but regardless of where and what exactly this thing was, this time you’d be there for all the digital adventures. As early as 2019, Louis Vuitton, after all one of the most expensive brands in the world, launched the first “skins” for the game. League of Legends. Such digital clothing, which can be purchased within the game, soon followed Fortnitewhere brands such as Balenciaga and Moncler are now also represented.

Gucci now offers its own virtual perfume

In 2021, Gucci opened its own “Gucci Town” on the online gaming platform Roblox, where users can play, chat, meet virtual friends and create their own worlds. The new Gucci Flora perfume just got its garden, including an avatar of advertising face Miley Cyrus. In addition to bags and accessories, visitors can now purchase the digital perfume in a double G backpack in the online store.

And at the end of March, the world’s first Metaverse Fashion Week was announced, but it did not take place in the real world, but on the Decentraland platform. Brands such as Etro, Tommy Hilfiger and Dolce & Gabbana presented digital runway shows with avatars. Spectators themselves could also move there as avatars. The whole environment was reminiscent of Second Life and was so clunky that many users gave up in frustration. On September 11, Tommy Hilfiger will debut his physical appearance in New York for the first time simultaneously as an avatar version on Roblox. And – it’s business after all – both real and virtual models will be available immediately.

So many big announcements from brands everywhere to take over the Metaverse. Where the term dazzling is often used in a rather vague way. “No word is currently misunderstood as often as Metaverse,” says Marjorie Hernandez, one of Germany’s most important voices when it comes to digital fashion. Born in Venezuela, she co-founded blockchain provider Lukso in 2017, followed two years ago by The Dematerialised, a marketplace for digital NFT fashion. “My definition might not be particularly exciting, but it’s basically just the Internet, just in version 3.0. The Metaverse is not being built, like a lot of people always make it sound,” Hernandez says. “It already exists and is growing.”

After music and movies, fashion must finally dematerialize

Almost as vaguely as people imagined the Internet in the 1980s, there are now a wide variety of visions of the future, some of which will probably remain lucid dreams. “But it is almost certain that at some point we will be fluid from the real world to the virtual world and live in a ‘multiverse’.” So in the morning you sit at the breakfast table with your very real family, then you attend a conference in virtual space as an avatar, in the evening you play an augmented reality game and meet friends there. For the fashion world, this future means one thing above all, Hernandez believes: “The decoupling of value and the physical product.” Or in other words: the dematerialization of clothing and accessories.

If you’re sitting there in a pair of fairly real trousers and a T-shirt, you might find this idea a bit daring. Music can be digitized, movies and series, maybe money – but fashion? How does this work? How should you wear this? And therein lies the misunderstanding. Not you, but the digital mods you’ll consume in the Metaverse.

Mark Zuckerberg presented this in a presentation last October on the occasion of renaming his company to exactly: Meta. The real Zuck stood there in front of his avatar, who, like him, was wearing a black sweater and jeans. With one swipe, the digital Zuck had on a T-shirt, then a Halloween costume, a costume suit. Scroll through the virtual wardrobe for something suitable, like on Tinder. Nice trick. There was still malice on Twitter. Does the future look so lame?

Beyond material boundaries, digital clothing can be incredibly exciting

The community was right. Because when it comes to fashion in the digital space, the possibilities should finally be limitless. Design can be freed from material limitations: clothing that constantly changes color, whose surface shines like liquid metal or bursts into flames, takes forms that would be incompatible with the laws of nature. The people of Meta tweeted Balenciaga that same night if they could support him on Metaverse fashion matters. Apparently there was no answer.

But how do you monetize this concept, will customers really pay for “nothing” to wear? “Of course,” says Marjorie Hernandez as a matter of course. “I still remember a young guy in Berlin saying I was crazy. You can’t win anything with digital fashion because it’s worth nothing.” Hernandez laughs out loud. He was wearing a Supreme T-shirt himself, which costs $5 to make but easily sells for $150. For a long time, fashion is not only associated with material value, but its actual value has long been of an unrealistic nature. Get paid for status or group membership.

And it has long been acquired in intangible fashion. A virtual Gucci bag was recently resold on Roblox for 350,000 of its Robux cryptocurrency, equivalent to about $4,115 — while the same model costs “only” $3,400 in the real world. The Dematerialised platform, which Hernandez is involved in, launched a “figital” dress with the label Rotate at Copenhagen Fashion Week in August: For 800 euros you get a real dress with a flame print plus a NFT of the design that it is then practically on fire for the fact that users can adapt to the digital body. For 80 euros there is only the digital draft for Instagram itself or the ancestral digital gallery. Direct-to-Avatar is the new Direct-to-Consumer.

Noisy fashion business the sales potential is estimated at $50 billion by 2030. Generation Z already spends an average of eight hours online every day. In the new luxury study by the Boston Consulting Group, almost half of the respondents stated that they were interested in online virtual stores. Almost two-thirds of shoppers aged 18-34 feel that Metaverse makes it easier to discover luxury brands. Balenciaga has even set up the “Metaverse Business Unit”. Dematerialization is considered the future Dorado of the industry.

Dolce & Gabbana returned more than five million dollars with a “figital collection”.

A fairly successful – and profitable – figital collection was created by the moderately innovative label Dolce & Gabbana. In parallel with the presentation of Alta Moda last fall, an auction of nine designs took place in collaboration with the UNXD platform. “Collezione Genesi” consisted of five classic couture dresses with a corresponding NFT version: fabrics with an even brighter surface, a glass suit, incredible sparkling jewelry. The other four models were purely virtual in nature. Total earnings: 1,885 Ether (Ethereum cryptocurrency), at the time the equivalent of nearly $5.7 million.

Phygital, the interaction of physical and digital, is definitely a concept with a great future, agrees Marjorie Hernandez. When customers buy a product, they can always take the digital twin to use in the metaverse: when they walk around Roblox, at the next fashion week, or when the avatar participates in a video call.

According to the entrepreneur, in order to move freely in it, it is important that the Metaverse does not belong to anyone, neither to the Meta group nor to a game provider, but in the future to be a free universe. Otherwise you pay for a Roblox outfit that you can’t use for a Fortnite gig. Or you may need to purchase a certain beauty filter for your avatar multiple times. “It would be a bit like,” says Hernandez, “if you leave a lot of money in the Dior store and then the salespeople say, ‘Oh, sorry, these things can only be worn here in the store, take them out. not allowed.” Unthinkable. Or?