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Brand Strategy Metaverse Ecommerce

How Virtual Shibuya evolved to be one of the first ‘linked cities’ in the metaverse


By Charlotte McEleny, Asia Editor

February 8, 2022 | 8 min read

What started as a project between Japanese telco KDDI and Tokyo district Shibuya to create a digital twin city and prove the power of 5G has blossomed into a full-scale metaverse experiment. The Drum speaks to Geometry Ogilvy Japan about the lessons learned from creating one of the world’s first ‘linked cities.’

In 2020, telecommunications provider KDDI au 5G partnered with Netflix and the Shibuya ward of Tokyo to create a virtual city, tapping into the streaming network’s original anime series Ghost in the Shell: SAC_2045.

Working with WPP agency Geometry Ogilvy Japan, KDDI and Shibuya Future Design (FDS) (a Shibuya Ward organization) set out to lead innovation with the Shibuya 5G Entertainment Project, a collaborative organization involving technology, IP, banking and other companies to promote further development and participation in 5G and the district.

From lockdown to virtual retail

Yasushi Arikawa, senior creative director, creative head of experience at Geometry Ogilvy Japan, explains that the initial version of the project was already under way before Covid hit, but it accelerated the need to create a virtual space as the city locked down.

“Having discussed the feasibility of implementing the experience in the real city, we then pivoted, and in May 2020 ‘Virtual Shibuya’ was born, a virtual platform that would itself reinvent the city of Shibuya. The city was locked down, and for those who could not go out ‘Virtual Shibuya,’ easily accessible with a smartphone, was immediately accepted as a new entertainment experience. The highly successful launch event attracted more than 53,000 visitors.

“In October 2020, after the second and third waves of Covid, we hosted ‘Virtual Shibuya Halloween’ in a safe and secure virtual space to discourage people from visiting the huge ‘Halloween in Shibuya’ event that usually attracts one million visitors a year and represents Shibuya Ward. Several programs were held, including Trick or Treat content with digital incentives, avatar contests, talk shows and music concerts, which were successful in attracting more than 410,000 visitors,” he explains.

Virtual Shibuya au 5G Halloween Fes 2020 from Geometry Ogilvy Japan on Vimeo.

Shibuya to Harajuku

The project extended into 2021 with the launch of Virtual Harajuku, a collaboration between Laforet Harajuku (a department store in Harajuku) and Harajaku sneaker retailer Atmos. It was a place for commerce, including virtual experiences and sales of limited-edition products.

Over the space of the past two years, the project has evolved from a campaign to promote 5G into a more permanent dive into a future where real locations are linked to the metaverse, which KDDI and FDS have coined as a ‘linked city.’

Gareth Ellen, chief strategy officer at Geometry Ogilvy Japan, says: “KDDI and FDS refer to this concept as a ‘linked city,’ an environment where imagination is not constrained by the physical restrictions of streets and buildings. And as Covid restrictions ease they are excited to further explore the possibilities for hybrid urban and metaverse living. At the same time, feedback from participating consumers has been resoundingly encouraging. The people of Tokyo and beyond have expressed a sense of unity and of shared place, even though they are scattered around the nation.”

Linking virtual and physical

As to what has been learned from this early foray into the metaverse, Ellen believes the link to the physical city has been a draw, while they are just at the beginning of understanding what’s creatively possible for brands that partner with the space.

“Stakeholders from companies and people that exist in Shibuya and Harajuku are working closely together and participating in a form of ‘city building’ similar to that of an actual city. With each event, we are learning more about what metaverse environments can offer as an augmentation and extension of the physical world. In this instance, its connection to the physical world is perhaps driving its success. People have an immediate familiarity with the environment, yet also recognize the added value that is enabled. This first came from having the ability to participate in the iconic Halloween event that was canceled (physically) due to Covid. But beyond this we are creating opportunities for businesses to bring experiences to life more efficiently than they could have imagined with their physical presence alone,” he adds.

What’s next?

Spending close to two years building a metaverse experience so early on in the evolution of this new technology means Ellen and Arikawa have a head start on understanding what could come next.

Arikawa muses: “A commerce experience where NFTs and payment systems work together in the metaverse has the potential to create the next era of business for us. Digital products such as avatar items and costumes will be bought and sold, and a mall-like space will be created where various brands will gather.”

Adding to this, Ellen explains: “The opportunity for crossover commerce will exist where products can be viewed, experienced and purchased in the metaverse then fulfilled in the physical world. We are starting to enable such crossover by supporting the sale of limited edition or metaverse-exclusive products. The critical watch-out, however, is to avoid trying to mimic the physical world or simply bringing already highly-tuned traditional e-commerce experiences into these spaces. There must be some form of added value for consumers. For example, one dimension could be the community. In a metaverse environment, we can observe the activity and interests of others, which can be informative and inspiring.”

Virtual Harajuku

In order for the metaverse to be a space for business to thrive, there is a need for standards and regulation around both the virtual worlds and the hardware needed.

“We hope that the movement will be accelerated and activated through cooperation and healthy competition. Proprietary technology actions will work against consumer adoption and harm the collective,” adds Arikawa.

The business cases that will emerge in the metaverse

Geometry Ogilvy Japan’s Arikawa and Ellen outline four business cases for brands in the metaverse:

Sustainable commerce: Checking the fitting of real clothes virtually reduces mistakes in sizing, and as a result reduces waste and loss.

Jobs and professions: The creation of businesses that use a system such as Robux, where the currency in the platform can be converted into current currency, will promote employment in the metaverse, such as guides and administrators/moderators within the platform.

The evolution of social tipping: Social tipping will evolve. Distributors, game and world creators will be able to make money.

Digital layer: Real stores and malls will implement digital layers such as the metaverse and extended reality (XR) technology to augment their physical presence and enable unique, time-bound experiences.

To find out more about the metaverse, see The Drum’s recent deep dive on the topic.

Brand Strategy Metaverse Ecommerce

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