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Is the Metaverse the Next Big Thing in Franchising?
Franchisors like McDonald’s, Arby’s and Jimmy John’s are all investing in building up their virtual brand presence — here’s why.
The metaverse is a 3-D virtual world focused on the social connection among users, entered via a browser or headset and traversed via a digital avatar. But participants aren’t just making decisions in the digital space; many of the activities in the metaverse can bring real-world results — ordering a product that will be delivered to them, for example. Research firm Gartner predicts 25% of people will spend at least one hour a day in the metaverse by 2026, and it’s an industry that’s set to be worth $800 billion by 2024. So, naturally, franchise brands are starting to pay attention.
Many innovative franchisors are finding ways to expand their brands, businesses and intellectual property in the metaverse dimension.
McDonald’s, for example, filed a patent that will allow the brand to build an entirely virtual metaverse restaurant that delivers food to customers. Boutique fitness concept TRIB3 announced a partnership with VR company Sandbox, which will allow it to deliver its services, construct a virtual gym and sell its products through its presence in the metaverse.
The UPS Store recently joined the metaverse through a franchisee-facing collaboration with Inc. Magazine and Fast Company to create the “Helping You Be Unstoppable Store” in Decentraland. The virtual store provides small business owners access to three floors of exclusive content, tips and advice to help them succeed in their entrepreneurial endeavors. The store is designed to empower small business owners by being an immersive and interactive place to learn by doing and even providing networking opportunities with other small business owners,” said Sarah Casalan Bittle, the president of The UPS Store, Inc.
Other franchise brands entering the metaverse include Arby’s, Jimmy John’s and Buffalo Wild Wings.
Still, there are several questions franchisors need to ask themselves moving forward into this brave new world, such as: What role will franchisees play in the digital space? Who is the rightful owner of metaverse real estate? How will the brand service customers and clients? How does the franchisor monetize this opportunity?
While it is one thing to build an e-commerce platform or invest in a loyalty program app, moving to the metaverse may be a bit more involved. Franchisors, for example, will need to be willing to accept alternative payment methods such as ‘non-fungible tokens’ (or NFTs) or cryptocurrency. In addition, there are several legal considerations that need to be made to ensure all intellectual property is protected in the metaverse.
"Brands are moving to the metaverse,” said Chief Metaverse Officer and a web3 luxury and fashion innovator Cathy Hackl. “Businesses are buying real estate in the metaverse and making sales in the metaverse. But what is the metaverse, and is it a place where franchising should go? The metaverse is (or is likely going to be) a place where our digital and physical lives come together. And new technology like augmented reality, virtual reality, and blockchain/NFTs/cryptocurrency will allow franchising to go to the metaverse and participate in everything it has to offer.”
Time will tell whether the metaverse truly becomes as ubiquitous as some experts are predicting, but if it does, those franchisors who took the time and money to build their virtual home in the digital space will likely be glad they did.
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