Branding in the Metaverse: Exploring established brand management perspectives and the advent of decentralized branding on Web 3.0

Abstract: Purpose: The purpose of this exploratory qualitative research is: First, to explore what brands understand by metaverse and how they perform branding in this new context. Second, to investigate how established constructivist approaches to branding are performed within the metaverse. And finally, to define what decentralized branding is and how it is linked to a decentralized metaverse. Additionally, this research also focuses on answering the following research question: “What are the similarities and differences in the practices between pre-Web3 and Web3-native brands when approaching the metaverse?" Theoretical Perspective: This study reviews existing literature about the metaverse and its elements, blockchain and its applications and branding, focusing especially on established constructivist approaches to brand management, as well as on the rising phenomenon of decentralized brands. Methodology: This research takes a socio-constructionist, relativist perspective using abductive reasoning. Different methods for data collection were used in triangulation through conducting ten semi-structured interviews, netnography, multiple-case studies, and secondary data Findings: The metaverse has diverse definitions and a new view understands it as a time when the digital value becomes equally or more valuable than physical. Virtual worlds, virtual reality and augmented reality, offer different levels of immersive experience within the metaverse, acting as boosters of user experience. In the metaverse context, brand strategies can move between different levels of immersive experience, decentralization, and centralization. Decentralized branding is a set of practices to build brand value in and through a digital-first decentralized context, with the metaverse included in it. Conventional constructivist branding approaches, mainly brand communities and cultural branding, are still relevant in this context and can be combined with decentralized branding. Web3-native brands fit better with advanced levels of decentralization, as risks for pre-Web3 brands are higher. Theoretical Contributions: This study contributes directly to existing brand management and metaverse research. Firstly, the present work summarizes different definitions of metaverse - adding a new one to the field - and also explore diverse relations of branding in this context, updating established theories, such as brand communities and cultural branding, and also developing the new field of decentralized branding. Additionally, this paper also have contributions to existing research on blockchain and Web 3.0 Practical Contributions: The present study contributes by offering a critical view of how brands perform branding in the metaverse and the importance of understanding the context and technologies involving it. In that sense, this study can be an initial guide on how to understand communities, ownership, empowerment, tokenization, storytelling and the capacity of testing and learning as the main drivers for brands when thinking about their metaverse strategy in a decentralized environment. We offer a practical framework to help brand managers to visualize how to execute branding considering levels of decentralization and immersive experience within the metaverse.