The metaverse – or Web3 – is a widespread new concept that few people can define. But the excitement is very real: many major luxury brands are already spending millions to reserve a place in this parallel world.
This is the case with the LVMH group, which is starting to adapt its multi-channel strategy to explore the possibilities offered by this new virtual universe. Franck Le Moal, chief information officer of the luxury group, accepted this interview to tell us more.
Web3, unlike Web 2.0 which announced the arrival of social networks, is quite complex to define… It covers the issue of the blockchain, NFTs (non-fungible tokens) but also virtual reality. Does the eruption of the metaverse mean the end of both screens and physical sales channels for you?
Frank LeMoal: I don’t think we’ll be saying goodbye to our screens anytime soon, things are moving faster and faster, but there’s still a certain immaturity around the metaverse. The physical channel will remain until we can replicate high-quality, immersive experiences in virtual stores.
The basic topic is to know which virtual reality we want to develop relative to what exists in the physical world. This is an additional question that needs to be answered to better script existing technologies.
I wouldn’t say the debate is about the technology or the channel to use as such. Rather, it is a matter of the chosen product and the resulting customer experience, a process of personalization and freedom of expression of individuality in the service of the community.
LVMH shares the belief that the topic is important and that we should include our physical products in the metaverse, without settling for simple virtual reproductions. A digital twin is not useful in itself, more attention should be paid to the complementary experience.
The entertainment metaverse is the most talked about these days. But the interest of luxury in the world of video games is not new…
Indeed, luxury’s interest in the world of gaming did not appear in 2022 and we have long forged a conviction about the opportunities it can offer. LVMH very quickly maintained its connection to this universe of entertainment.
For example, Louis Vuitton teamed up with Riot Games to dress up a character from the League of Legends game, and more recently, the brand developed a mobile game called “Louis: The Game”, which provides information and anecdotes about its history. Gaming allows our customers to discover our products in a different way, with exclusive services and in a different form of magic.
The difference today is the advent of the blockchain in gaming, which guarantees secure and unadulterated transactions, as well as unlimited personalization of the gaming experience.
Bernard Arnault recently said: “We are not interested in selling virtual sneakers for 10 euros. That’s not what we’re here for,” referring to the speculative setbacks that contributed to the bursting of the Internet bubble of the 2000s. What do you think?
I am not claiming to speak on behalf of Bernard Arnault, but I think you should understand what he is saying by the fact that LVMH does not base its business model on selling sneakers. Our luxury brands value their know-how and that of their craftsmen and designers. We’re not going to compete with streetwear for the simple reason that our goal with the metaverse is to showcase our craftsmanship and the way our products are made.
So we will not stop at creating “digital single threads” – in other words creating NFTs that have no physical equivalent – and we will not just sell our current products through new channels. † Of course, the metaverse can bring in new customers, including the youngest, but the primary aim is to better promote our heritage and know-how, in particular by inviting visitors to virtually visit our leather goods workshops.
In addition, because the NFT market relies on the blockchain to function, we will be able to embed our physical products in digital certificates of authenticity that guarantee full ownership of the owner. The metaverse will reconnect the customer with the history and know-how of our products.
The metaverse is often dehumanized in the messages promoting it, while the promised new interactions will appeal to emotion and the sensory. It is too general a term and we prefer to talk about Web3 around three topics that drive us: proof of authenticity thanks to the blockchain, the NFT market and its potential for creation, as well as the virtual world linked to images.3D and customization of avatars. †
Can you tell us more about your NFT strategy?
When it comes to NFTs, we have to be honest, because all luxury players are discovering the subject. But the latter are no strangers to this, because everything that falls under the domain of artistic creation is linked to our activity, for the simple reason that luxury customers have always shown a strong affinity with art.
On the one hand, there are brands that reproduce virtual versions of their existing products. On the other hand, brands that exclusively create virtual collections that can then be reproduced in the physical world. We are already starting to envision parades in the metaverse where users can purchase NFTs of products before they are even produced in the store.
Last year, Dolce & Gabbana, AZ Factory and Givenchy, together with graphic designer Chito, Louis Vuitton with artist Beeple and new artistic director Nigo de Kenzo, decided to register the holders of one of the pieces from his collection. a tie to win exclusive NFTs.
We can also mention Hennessy, who offered a virtual and real sale of two limited edition bottles of cognac for an amount of 70.47 Ethereum, or more than 200,000 euros. The importance of luxury brands to NFTs is to provide customers with a guarantee of authenticity, as well as exclusive access to preview events, for example.
To adapt our multi-channel strategy to this fast-growing industry, we also plan to create a ‘Head of collectible NFTs and metaverse’ feature in the near future. We will have the opportunity to tell more about it at the next Vivatech show in June, where a speech from LVMH is scheduled to make some announcements on the subject.
†< Lees ook: Sébastien Borget, mede-oprichter van The Sandbox: “Om ervoor te zorgen dat de metaverse echt waarde toevoegt, moeten merken niet reproduceren wat er in de echte wereld bestaat. » >†