Sportswear and luxury apparel brands are well-placed to succeed in the metaverse, particularly those with a strong brand identity and high levels of loyalty among the digitally literate younger consumers. Both the categories flourished in 2021 owing to the altered consumer behavior during the COVID-19 pandemic, finds GlobalData, a leading data and analytics company.

Both the categories are forecast to continue thriving in the coming years, especially the brands that align themselves with developing industry themes and cement their places in the ever-expanding metaverse.

Darcey Jupp, Apparel Analyst at GlobalData, comments: “Sportswear and luxury brands are typically seen as innovative and aspirational, meaning consumers are more likely to purchase into the brand as a status symbol and to assure they own the most ‘up-to-date’ products. This gives these brands the opportunity to explore various pathways into the metaverse including games, NFTs, and virtual fashion, to test the most suitable combination.

“However, the sheer amount of energy required to mine cryptocurrencies and mint NFTs conflicts with many apparel brands’ sustainability pledges. As players such as Adidas and Kering strive to reduce their carbon emissions, releasing NFTs on the Ethereum blockchain could appear contradictory, even if most energy usage is passed onto the minter. “

Brands which engage with consumers through their sustainability credentials should be cautious of how they enter the metaverse, as the connection to climate issues becomes more common knowledge.

Jupp concludes: “Most importantly, apparel brands must be taking steps in the metaverse that are appropriate to their key consumers. Many are still transitioning to online shopping after it surged in the pandemic, particularly older consumers, so are far off from incorporating the metaverse into their daily lives.

“Also, brands must ensure that they have strong consumer engagement with their existing proposition before trialling virtual projects, as consumers will continue to stay loyal to their favourite brands in the metaverse.”