Excitement and Caution Fill the Metaverse

Global businesses say the metaverse is the future and the next big opportunity. And some are already beginning to bring together many of the next-generation technologies available now.

However, a new report from KPMG executed by Forrester Consulting raises as many questions as it answers and shows that despite the enthusiasm and planned investment, many organizations still do not have a real fix on what the metaverse will look like and how it will change how they operate.

Forrester surveyed the views of 767 TMT executives worldwide to gauge their readiness, expectations and plans for the metaverse, and the results give a picture of an industry expecting change but not understanding what that could mean.

For example, while 60% of the executive respondents believe the metaverse will significantly impact consumers and businesses, only a third feel adequately prepared with platforms for experiences and related processes.

“TMT leaders appear to be excited and cautious in equal measure, which may explain why few are investing more than five percent of their total technology budget on the metaverse,” the report says.

However, the story was different when asked about their companies’ investments in the metaverse for the future compared to today.

“84% said they plan to increase or maintain investments in five to ten years from now, and an astonishing 92% said they plan to increase or maintain investments in two to four years from now,” the report notes.

Wait and see

So, how to interpret these responses? The KPMG and Forrester report only goes so far in doing that. The takeout is that many organizations lack clarity on their metaverse business models and are playing wait-and-see.

Most are reluctant to plow in and make significant investments now and lack the commitment to lead the way.

Other data points in the survey also who a curious lack of confidence in the metaverse future and suggest—perhaps like Facebook’s transformation into Meta as its corporate brand—the idea is more hype than reality.

“Leaders appear to be excited and cautious in equal measure, which may explain why few are investing more than 5% of their total technology budget on the metaverse”

For example, the executive respondents expect around 40% of their organization’s metaverse investment to be directed toward marketing and branding.

And only a third see building a business case as an essential next step for better enabling their metaverse strategy.

“They also hope that interacting via the metaverse can improve the customer experience and enhance their brands,” the report says.

So, does this mean that a large part of the metaverse is just rebranding and marketing? In other words, is it just hype?

It would seem that many organizations plan to tout their metaverse products before they even have a compelling and cohesive metaverse product offering.

The report shows that “only a third see building a business case as an important next step for better enabling their metaverse strategy.”

Start internally

Even so, more than half of the organizations are investing in metaverse staffing and resources, and many say they already use many of the tools that will support the metaverse—or at least plan to do so in the not-too-distant future—such as augmented reality, virtual reality, decentralized platforms, and digital twins.  

Almost two-thirds anticipate conducting at least some business meetings in the metaverse within the next decade. Still, the report points out that client discussions “may tell a different story.”

The report suggests that organizations focus on internal projects first to find efficiencies and drive employee collaboration rather than roll out customer-facing projects.

These projects are also a way into the future, with most seeing a horizon of four or more years.

“Gaining efficiencies such as increased employee retention can bring financial benefits and speed up organizational learning of how to harness the metaverse,” the report says.

“Beginning at home means hiring and developing metaverse talent – while also seeking hidden capabilities in your own and your partners’ organizations. For instance, you probably have a cohort of workers who already game or use the metaverse in other ways: they offer a rich source of understanding and technical skills.”

Put this all together, and the short-term development of the metaverse would appear to be internal, with KPMG and Forrester seeing “a wealth of opportunities to pilot metaverse initiatives and develop capabilities for the long term—at lower cost and risk than trialing with customers.”

So, we are likelier to see the metaverse at work before seeing it as consumers.

By then, perhaps, internal projects might start to clarify the business and use cases, making it more than a vague idea and marketing hype.

Lachlan Colquhoun is the Australia and New Zealand correspondent for CDOTrends and the NextGenConnectivity editor. He remains fascinated with how businesses reinvent themselves through digital technology to solve existing issues and change their entire business models. You can reach him at [email protected].

Image credit: iStockphoto/chanakon laorob