Source: “The Metaverse and How We’ll Build It Together” – Meta
Bernard Arnault, CEO of LVMH, said the French luxury group is willing to wait to embrace the metaverse and remains wary of potentially speculative bubbles.
“This is a virtual world. And right now, we are very much in a down-to-earth world,” Mr. Arnault said last week on LVMH’s fourth-quarter analyst call. “We want real product, selling for real.”
Mr. Arnault conceded that it’s “rather thought provoking” to see non-fungible tokens (NFTs) generating profits.
For now, however, he added, “We are not interested in selling virtual sneakers for 10 euros. We're not into that. There may be more relevant applications, but we have to see what these applications might be.”
Mr. Arnault further added that LVMH is “wary of bubbles” that have happened in past digital phases. He elaborated, “At the beginning of the internet in the 2000s, there were all sorts of things cropping up — left, right and center. And that was a bubble that burst.”
Many firms, he added, likewise later tried to create social platforms similar to Facebook but “only one pulled through and the others failed. So we have to sound the note of caution.”
Gucci, Prada, Balenciaga and other luxury players have been experimenting with branded in-game characters and NFTs across a range of virtual platforms.
A recent Morgan Stanley study estimated the metaverse could represent a revenue opportunity of $56 billion for luxury, or 10 percent of the marketplace by 2030, with early adopters benefiting. The report stated, “NFTs and social gaming present two near-term opportunities for luxury brands, allowing them to monetize their vast IP (intellectual property) built over decades.”
Hype around the metaverse as the next internet revolution has shot up since Facebook’s name change to Meta, but the underlying technology is seen by even metaverse proponents to be in the early stages. Turbulence is expected as platforms are developed.
Cathy Hackl, chief metaverse officer at the Futures Intelligence Group, told Vogue Business, “We've seen hype cycles in the tech industry before that have led to bubbles. We will possibly see area specific bubbles and market corrections [in the metaverse].”
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- LVMH CEO Bernard Arnault says ‘we have to be wary of bubbles’ with the metaverse – CNBC
- Bernard Arnault in Wait-and-See Mode on Metaverse – WWD
- Metaverse Gaming, NFTs Could Account for 10% of Luxury Market by 2030: Morgan Stanley – CoinDesk
- Luxury NFTs Could Become a $56 Billion Market by 2030 – Business Insider
- Metaverse: Opportunities for Investors Today – Morgan Stanley
- LVMH’s Arnault is wary of the metaverse “bubble”. Should luxury be? – Vogue Business
- In the metaverse, brands’ FOMO is competing with consumers’ burnout – Digiday
- What the metaverse means for retail today, and what's in store for tomorrow – eMarketer