Why the Metaverse Could Be a Breakthrough in Privacy-Friendly Digital Marketing

The metaverse is currently one of the hottest areas of marketing, but questions remain about how privacy – a increasingly important value for consumers – will be factored into the burgeoning space. A lack of technical knowledge about augmented reality/virtual reality (AR/VR), historically slow-moving political regulations, and consumer skepticism create an uphill battle for marketers, who will need to take privacy seriously if the metaverse one day reaches the level of public interest that companies hope for.

Despite these challenges, or perhaps because of them, the Metaverse presents an opportunity to be a breakthrough in privacy-compliant digital marketing. Brands have the advantage of taking lessons from past digital marketing efforts, such as the importance of consent or the need to listen to a community of users, and applying them to the development of their metaverse platforms. And with the imminent deprecation of third-party cookies, the space could be a fresh start built on more privacy-friendly tracking alternatives.

“For brands, [the metaverse] will be a bit like the Wild Wild West so what would be ideal is for them to take frameworks and learnings from the internet and begin to understand how these can be proactively applied to the work they do said Rachel Noonan, chief strategy officer at agency Jam3, which recently merged with Media.Monks.

The development of the metaverse could mirror the development of the web in significant ways, including the key role advertisers will play in influencing consumers on new platforms. So brands should take the lead in the privacy conversation, Noonan said.

But history has a way of repeating itself: Meta, formerly Facebook, seeks to control the metaverse the same way it has on social media. If brands remain passive and the company – or other walled garden giants – attracts the same level of consumer distrust that it has on the web today, the fruit of the metaverse could be ruined for everyone.

“How can a brand stand out from this and own this and lead by example and nudge the behavior of other brands?” asked Noonan.

No cookies, no problem

A significant opportunity for the metaverse to be privacy compliant comes with the impending deprecation of cookies. Google now plans to phase out the tracking mechanism by 2023, a period that will likely coincide with the fundamental development of the metaverse given that the technology is still years away from the realization.

This means for brands that the metaverse could be an incubator for more secure tracking methods, such as contextual marketing, as cookies will no longer exist as an option.

“The rise in [the] metaverse and the way it’s talked about so much is because it’s a logical consequence of abandoning cookies in one form or another,” said Gowthaman Ragothaman, CEO of martech firm Aqilliz and former global client manager at WPP. .

By consciously entering the metaverse for each session, users are required to sign up for this service, which for brands ticks many regulatory boxes for a connected direct consumer, Ragothaman said. This process is similar to the idea behind Apple’s App Tracking Transparency (ATT) framework – a significant improvement in privacy compliance over the previous assumption that consumers always gave consent.

“Consumers repeatedly ask for experiences, and you can actually ask them, ‘Can I use your data?’ every time,” Ragothaman said.

The push-pull of consumers who want personalization but not through invasive methods is at the center of a new privacy paradigm, according to Noonan. As the metaverse builds, it behooves marketers to develop data strategies that are transparent but also simple enough for consumers to understand.

“We build the house, we have the foundation, and if [brands] build it on wood instead of brick… it’s going to be difficult to rebuild the house,” Noonan said.

Community and Consent

Through previous digital marketing efforts, brands have learned that putting the user community first in their approach helps build trust on the platform. On TikTok, for example, brands have found success through “community commerce,” which increases engagement through marketing that looks and feels like organic content.

“The rise in [the] metaverse and the way it’s talked about so much is because it’s a logical fallout of cookie deprecation in one form or another.”

Gowthaman Ragothaman

CEO, Aqilliz

In the metaverse, brands should similarly welcome users into their decision-making processes, said Maura Welch, vice president of marketing at Together Labs, a software company that leverages the metaversal social networking site IMVU.

“We let the community decide what’s cool…we’re actually bringing our community into that conversation. And that’s how brands should approach the metaverse,” Welch said.

For a fashion show this spring, for example, IMVU paired a slew of real-world designers with 3D creators on its platform, and together they developed purchasable clothing lines for IMVU users. The activation also enlisted producers from the IMVU community to promote the event.

“It’s a very different experience when you’re actually interacting with the brand, wearing the items, walking through the spaces designed and co-created with people you respect and know from the platform,” said said Welch.

Like community, consent is another idea that has become an increasingly high priority for brands looking to build trust in digital spaces. With companies like Facebook repeatedly abuse the user’s consentconsumers are both wary of privacy practices and willing to go elsewhere if they feel they are being mistreated.

“As soon as a consumer realizes that their data has been exploited… it breaks. So we have to be very, very careful in breaking consumer trust [because] it can break very quickly,” Ragothaman said.

Metaverse brands could therefore benefit from maintaining a record of the data they have about users, according to Ragothaman, similar to a customer relationship management (CRM) system. Such a record could further help brands get a head start on regulatory policy if and when it catches up to space. In the EU, for example, the use of a CRM platform has been a useful way to comply with the General Data Protection Regulation (GDPR).

Non-fungible tokens (NFTs), which have been one of the most popular entries into metaverse spaces, illustrate how consent management could be improved in the metaverse. The technology behind blockchain enables a more secure transaction in the digital world, providing the ability to trade in a smooth and protected manner, Ragothaman said.

As the metaverse grows, that same technology that enables secure NFT wallets could standardize data wallets, Ragothaman noted, so consumers would be able to fully consent to whatever bits of data they want. redeem for experiences, collectibles, or other assets.

“The Metaverse provides all of these things…instead of mining, you can mine consumer data in a much better way,” Ragothaman said.

Decentralized versus centralized

Another lesson brands can apply to the metaverse is that walled gardens are inconvenient for almost everyone involved. While a few strong companies such as Facebook and Google are benefiting from centralization on the internet, marketers at all levels face obstacles know their consumers better, while consumers themselves will inevitably interact with less relevant advertisements. For these reasons, the metaverse could be an opportunity for brands to create a more decentralized advertising environment.

“If you build walls and barriers, it creates pressure points and friction points for consumers,” Noonan said.

She added that the metaverse will ideally be a place where many different platforms will talk to each other and allow consumers to move from one space to another. In a centralized environment, such fluidity would be made difficult by strict rules of one or more powerful gardens.

“We let the community decide what’s cool…we’re actually bringing our community into that conversation. And that’s how brands should approach the metaverse.”

Maura Welch

VP of Marketing, Together Labs

Similar to the Internet, politics will help determine how this navigation will work, but in the meantime, marketers need to be proactive in their strategies and not wait for legislation to arrive.

For example, forming alliances with middlemen who have already done the heavy lifting on what’s privacy-compliant and what’s not could help brands get a head start, Noonan said.

The Electronic Frontier Foundation (EFF) is one such group that has treasure troves of useful data for brands; he also has writes specifically about privacy issues metaverse technologies. Other groups cited by Noonan were media advocacy organizations Harmony Laboratories and the Pew Research Center, which is already compile expert opinion on the future of digital spaces.

Upgrading an existing product with new regulations is expensive, according to Noonan, which is why brands should consider these things now. Additionally, having to go back and restructure a company with jobs and workgroups could be a blow to product development.

Centralization isn’t the only area threatening an open and connected metaverse. Barriers to consumer confidence still abound, from reluctance to test VR platforms to lack of technical knowledge of the space. But as they move forward, brands are smart to look back at how marketing has evolved through the current iteration of the web and use that information to inform their metaverses.

“It would be a shame if we didn’t take advantage of all this learning [from the last few years] and setting the parameters so that we can bring people what they want, how they want and where they want, but in a place where people feel safe,” Noonan said.

Correction: A previous version of this story misrepresented details of Jam3’s relationship with Media.Monks. The agency merged with the production company earlier this year.