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17 Nov, 2021 08:43

Metaverse could become a $50bn fashion & luxury market

Metaverse could become a $50bn fashion & luxury market

Demand for fashion and luxury brands could grow exponentially on sales in the alternate world of the metaverse, according to Morgan Stanley (MS), one of the world’s biggest investment banks.

Revenue streams from digital mediums for luxury brands are negligible... we think this is about to change,” MS wrote in a note to investors on Tuesday.

The bank, which last week called the metaverse “the next big investment scheme,” notes that while it will still take years to develop, some of its sectors are already appealing to luxury brands. This also goes for non-fungible tokens (NFTs) and social gaming.

Morgan Stanley said, for example, that 20% of Roblox game platform users update their avatars on a daily basis, which is a clear opening for fashion brands, with several collaborations already in the making.

We expect the whole sector to benefit from the advent of the metaverse, but see the soft luxury brands (ready-to-wear, leather goods, shoes, etc.) as particularly well positioned as opposed to hard luxury (jewelry and watches).”

The bank also notes the recent sale of NFTs by Italian brand Dolce & Gabbana for $5.7 million as a sign that virtual and hybrid luxury goods have real potential in the virtual world.

MS analysts forecast that metaverse NFTs and social gaming combined can expand the luxury industry’s market by over 10% in eight years, prompting a 25% surge in earnings – and overall, the fashion and luxury industry in the metaverse may reach $50 billion by 2030.

READ MORE: Imagine tags over people’s heads: Metaverse could make reality ‘disappear’

The metaverse is a work-in-progress alternate digital universe where users can model their image and engage in real-life activities, like shopping, communicating, gaming, etc. A number of companies have expressed interest in the developing alternate world, with Facebook (rebranded as ‘Meta’), Microsoft, Roblox, and others building versions of the metaverse on their platforms.

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