Member Exclusive   //   March 13, 2023

Modern Retail Research: 73% of brands say they don’t buy into web3

By Liz Flora

Despite the deluge of brands making metaverse hires and launching NFTs last year, new survey results find that they don’t see web3 having a big impact on their business. 

Few brands and retailers responding to Glossy and Modern Retail’s Q1 2023 survey believe that the technologies generally described as “web3” will have an impact on their business this year. When asked to select whether the metaverse, VR, NFTs, blockchain, cryptocurrency or “other,” will have the biggest impact on their business, 73% of respondents chose a seventh option: “none of the above.” 

The percentage of brands that don’t expect an impact from these technologies is significantly higher than that of those surveyed last year, when 54% selected “none of the above.” 

Among those that do see web3 having an impact, the metaverse is the biggest technology they’re still betting on, with 12% expecting it to have an impact on business in the coming year. In 2022, consumer brands went on a metaverse hiring spree, with Gucci, Balenciaga and Nike among those creating new roles for the technology following Facebook’s 2021 rebrand to Meta. But that buzz seems to be in decline: In last year’s survey, 16% had selected the metaverse. 

Following revenue loss, Meta is reportedly nearing a second round of thousands of layoffs. This is attributed mainly to ad sales declines, as a result of Apple’s iOS changes. But the company’s focus on the metaverse is also a factor, as its Reality Labs division lost $13.7 billion in 2022.

Brands’ interest in VR — another big component of Meta’s bet on the metaverse — is also on the decline. Only 8% said it will impact their business in the coming year, down from 12% who made the prediction in 2022.

Respondents also have next to no faith in NFTs, crypto or blockchain having an impact on their business in the next 12 months. 

While consumer brands across categories rushed to roll out NFTs over the past two years, mostly as a marketing moment, these campaigns haven’t panned out into results for business. In 2022, only 5% of brands expected NFTs to have an impact, while only 2% said the same this year. The value of the Ethereum-based NFT market declined by 60% in 2022, according to one estimate. 

Blockchain, which consumer brands in recent years have cited as promising for areas such as authenticity verification and supply chain tracking, has also seen a dropoff. While nearly 8% of brands selected it last year, less than 1% said it will have the biggest impact on their business this year. Cryptocurrency, which also crashed last year, saw a decline from 5% last year to less than 1% in 2023.

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