Even as it seeks to broaden its metaverse offerings, Roblox Corporation counts more than 2 million Russian users among its active user base.
The new services will feature metaverse advertisements from well-known partners like Gucci, Ralph Lauren, and Chipotle. Developers can earn a cut of the advertising revenue by incorporating advertisements in the form of interactive billboards, taxicab roofs, posters, and other locations. New branded experiences, such as Gucci Town or a virtual Chipotle, will be accessible via 3-D portals within the games themselves.
As a result of the exodus of major gaming companies from Russia in an effort to punish the Kremlin for its invasion of Ukraine, Roblox has seen an increase in its user base there. Roblox is well-positioned to establish itself in Russia because industry heavyweights like Electronic Arts Inc., Ubisoft Entertainment SA, and Nintendo Co. have either stopped selling in Russia or drastically reduced their Russian presence. About 11 million people in the United States play the game regularly.
Roblox stated at its recent developer conference that it will be selective in allowing brands to purchase real estate within its metaverse. According to the company’s forthcoming age guidelines, immersive ads will only be shown to players over the age of 13.
Where does that leave Meta Platforms (aka Facebook) in its quest to become the commercial hub of the metaverse, now that major brands have staked out their territory on Roblox?
Mark Zuckerberg, CEO of Meta, has marketed the platform as a place where users can do everything from hold virtual meetings to make new friends to shop for goods to study for classes to play games. So far, the company’s focus has been on using classroom instruction to introduce virtual world designers to the processes involved in creating a metaverse. Horizon Worlds VR, a virtual reality experience for users of the Oculus Quest VR headset, has been developed by the company as well. According to one expert, Horizon Worlds VR serves as a “testing ground for commercial opportunities,” or a “litmus test” for what users are willing to pay for in the metaverse.
Until now, Roblox developers have used Robux, the game’s virtual currency, to pay for advertising space, primarily to entice players to download and play Roblox. Robux can be used to buy virtual goods in the Roblox marketplace, with a portion of the proceeds going to the virtual marketplace’s creator, Roblox.
To date, Meta has been silent on the topic of whether or not virtual currencies will be accepted in the metaverse. Its attempt to create its own virtual currency was met with significant backlash from regulators and went down in history as one of the company’s worst failures. However, early this year, it announced the launch of a virtual currency aimed at a select group of developers in exchange for premium services and luxuries like jewellery. It’s not yet known if this new currency will serve as the cornerstone of a metaverse economy.
When it comes to making money in the metaverse, who will win? Though it now appears that Roblox will be a leader in the as-yet unproven field of metaverse advertising, the company was originally conceived as a physics simulation engine rather than a revenue generator for advertisers. However, unlike the massive PR scandals that have rocked Meta in recent years, it promotes optimism and civility as essential components of player engagement.
Still, it’s not hard to imagine it making a serious run at a billion-dollar slice of metaverse revenue, given Zuckerberg’s unbridled ambition and Meta’s history of playing hardball.
But it needs to make up some ground.
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