The Metaverse: Bridging the Physical and Digital Worlds

In the vast expanse of the universe, with its millions of galaxies, imagine a digital galaxy like Earth where customisation knows no bounds. With the advent of virtual reality (VR) and augmented reality (AR) headsets, we can now teleport into this world—a galaxy called the metaverse. Within this metaverse, multiple planet-like worlds have emerged, such as Decentraland, Zepeto, and Roblox, each revolving around the core concept of an open-world experience.

To fully immerse ourselves in these digital planets, we utilise avatars as mediators between the physical and digital realms. Avatars allow us to teleport into the digital world and can be personalised and customised to our liking. Depending on our tastes and preferences, the customisation options are vast and unique to each individual. 

Just as two persons avatars will differ, so too will their activities within the metaverse. For example, one person may have an interest in attending a virtual music concert, while another may prefer participating in a thrilling car race. Some may even indulge in virtual shopping, where brand choices and preferences vary. The metaverse thus provides a personalised experience, offering insights into users preferred activities, preferred social interactions, and behavioural patterns.

For those seeking unique experiences in life, the metaverse opens up new possibilities. Users can purchase non-fungible tokens (NFTs) to acquire add-on items like body skins, accessories, garments, and gestures. Luxury brands like Gucci have even ventured into this space, launching NFT versions of their products. In fact, the Gucci Dionysus bag sold on NFT platforms for more than its physical counterpart. Users can also purchase virtual land and establish retail stores or create customised homes.

The metaverse enables direct sales to avatars, eliminating intermediaries. This direct-to-avatar (D2A) commerce is considered the future of e-commerce, where brands engage directly with end consumers. Entrepreneurs like Andrew Kiguel, co-founder and CEO of, have recognised this potential and invested millions in the metaverse. Kiguel has even rented out spaces in the metaverse for fashion shows and retail shops.

What more, brands across industries have also begun to embrace the metaverse. Gucci, H&M, Samsung, Vodafone, and others have already established virtual malls. Hyundai has launched the Hyundai Mobility Adventure games, while Louis Vuitton commemorated its 200th anniversary with a game within the metaverse.

The ability to merge the physical and digital worlds has paved the way for brands to explore the metaverse. It represents the evolution of the online shopping experience and provides a competitive edge. The possibilities are limitless, as demonstrated by Nike, which introduced an NFT digital twin of its physical hoodie in the metaverse, complete with wings.

Tools like Unreal Engine MetaHuman Creator allow users to create highly realistic digital replicas of themselves, enabling them to try on clothes and make purchases for both their physical selves and their digital twins. Metaworlds like Zepeto even enable users to dress their avatars in Gucci attire.

A Phygital World: Are We Ready?

Phygital is a complete cycle that strengthens and improves the physical experience using hybrid virtual spaces. With the metaverse on the virtual horizon, we predict that phygital will go through a seismic shift, sparking a new wave of creativity, imagination, and ingenuity.

Digital twins and phygital objects will help build the foundations of the industrial metaverse, which opens up a discussion about how smart cities of the future will operate. The metaverse could host data-driven cities that use intelligent systems, signifying an ambitious shift towards techno-urbanism. Smart city initiatives are already underway in many metropolitan areas around the world, including the South Korean capital of Seoul.

Seoul is undergoing a digital transformation on a city-wide scale that promises to be the first metropolitan government with a full-service virtual world. Park Yun-Gyu, Head of Communication at the South Korean Ministry for Science & ICT, said in a recent statement.  “It is important to create a world-class expanded virtual world ecosystem as a starting point for intensively fostering the expanded virtual world.”

A range of public services will be available in the Seoul metaverse by 2023. A virtual city hall where citizens can meet avatars of public officials is in the works and will go a long way in making public services more accessible. Citizens will also be able to file other types of administrative requests including booking library meeting rooms or tennis court slots. One of the biggest advantages of a virtual city hall is its capacity to overcome time, space and language barriers. Citizens can even use cell phones connected to IoT to visit cultural sites virtually if they can not be there in person. This is particularly important for vulnerable communities such as disabled residents who can engage with public services safely and conveniently.

It is compelling to think that one day soon, a city of almost 10 million people will have smart infrastructure and super-personalized experiences powered by the combined might of the metaverse, Web 3.0, IoT, and phygital technology. One question still remains. Are we ready to embrace a world powered by smart technologies, interoperability, and mass technology integration? The data points to yes.

According to Statista, smart infrastructure is the largest segment of the global smart city market, with revenues worldwide forecast to reach more than 70 billion U.S. dollars in 2021. This constitutes a market share of almost 55 percent for intelligent infrastructure within the global smart city market. These numbers show the increasing importance of the digital format, which will one day become the backbone for persistent, virtual worlds based on our own.

The world as we know it is quietly undergoing a technological transformation as businesses and consumers invest more time and money in the metaverse. Developers are already discovering new applications for phygital technologies that will rewrite how we communicate and interact forever. For example, tech firm Magik Book created a unique Phygital marketing strategy with their interactive book series. Theory designed a physical marketing catalog for Porche which was displayed in car showrooms.The Magik Book digitally connects to an iPad, and as consumers flip through the pages, related content is displayed creating a unique phygital approach.

The retail sector is undergoing an industry-wide transformation and adopting new technologies that enrich and enhance the customer journey. Read our article, “Retail Digitization in the Metaverse,” to discover the metaverse effect on the retail sector and its associated implications for future shopping experiences.