Bypassing the digital worlds and the Metaverse is becoming increasingly difficult. The digital lifestyle of younger generations is increasingly influencing the way brands communicate with their desired target group. As this happens, more and more terms are being introduced to describe the various, complex elements of the growing digital field – but with all the advances, it’s difficult to know exactly what is meant.
In order not to lose touch with the rapid development of digitization, FashionUnited has put together a selection of terms and words that are essential for understanding this vast new universe.
metaverse
Contrary to the popular belief that the term “metaverse” refers to a single virtual world, it is an umbrella term for any virtual world that offers digital experiences as an alternative or replica of the real world. These worlds can virtual realityso virtual realities or mixed-reality, mixed realities. In the virtual rooms, users can move freely and interact with each other. In addition, the rooms of the digital platforms can be inhabited. The virtual worlds are usually based on social connections and games that allow users to connect and communicate with each other.
Web3
Web3, or Web 3.0, is often referred to as the “next generation” of the Internet. This aims to network and involve users on a larger scale. While the current model of the Internet – Web2 – requires scrolling and clicking of content on two-dimensional web pages, Web3 aims to expand interaction beyond what has previously been possible through the introduction of immersive websites and platforms.
Also, much of the Web3 relies on users being able to “own” the web and create content for their own benefit. This form of internet is decentralized and not overseen by big tech giants.
virtual worlds
A virtual world can be both a simulated version of the real world and an imagined environment. In most cases, virtual worlds are created as habitable spaces and allow interaction through avatars. Many users can access and explore the platform at the same time. There are usually also options for building and traveling within the world. Some even have their own trading and marketplaces where players can buy digital goods. The most popular virtual worlds include Roblox, The Sandbox and Decentraland – many brands are also represented here.
Non-fungible token (NFT)
A non-fungible token (NFT) is a digital certificate that authenticates the ownership of a digital asset. Supported by the Blockchain For example, an NFT can be tied to unique, non-interchangeable possessions such as pictures, music, or avatars. The concept really took off in early 2021 and has since enabled designers and artists to secure the rights to their works online.
Brands have also incorporated the feature into their own Metaverse-based projects, selling NFTs to be used as “keys” providing access to exclusive content, member events, or digital products. Digital products can be worn in the virtual world and are part of a new form of customer loyalty
Virtual Reality (VR)
Virtual reality, or virtual reality (VR), refers to an immersive, computer-generated environment in which users can fully immerse themselves in a simulated reality. To enter such a space, products such as VR headsets are used, which offer a 360-degree view of a virtual world and allow users to move freely and interact with their surroundings.
Augmented Reality (AR)
In contrast to VR, digitally generated images are superimposed on the real world in augmented reality. Often all you need for this function is a mobile phone, whose camera function can be used to view real environments with superimposed graphics.
Social media apps like Instagram and Snapchat use AR filters and lenses that digitally alter a face or the real world. Brands have also used this technology to introduce “virtual try-on” features. These allow shoppers to use a digital filter to see how an item would look on them.
Mixed Reality (MR)
Mixed Reality (MR) describes the merging of the real world with computer-generated environments. It combines physical and digital content to enable interaction between the two. Past initiatives based on this concept include fashion shows taking place in both real and digital worlds, or presenting a real event on an open-world virtual platform.
Extended Reality (XR)
Extended reality, a type of augmented reality, brings together the technologies of VR, AR and MR to create a computer-generated virtual experience that blends the physical and virtual worlds. Brands that have implemented this strategy have launched initiatives such as virtual shopping experiences, where you can shop with an avatar in a digital version of a real-world environment.
avatar
An avatar is a digital character that represents players and users in a virtual world. While traditional Web2 avatars are static icons that do not interact with their environment, Web3 avatars become an extension of the user and can perform a range of functions in an immersive space.
These digital individuals have evolved over time into customizable characters in games and virtual influencers. You are able to represent brands and interact with an audience. Examples include Lil Miquela and Shudu Gram, two avatars who have a large following on social media.
Artificial Intelligence (AI)
Artificial intelligence (AI) is a term for a machine that mimics human-like cognitive abilities, such as the ability to solve problems or process speech. Although robots are sometimes considered the main form of AI, the term usually refers to computer programs. Because the programs gather information, they can often self-improve and learn from experience. AI can be used for algorithms that help brands automatically determine relevant content to show to customers to personalize their experience and communications.
Blockchain
A blockchain is a platform that provides a collective record of information that can only be modified and updated by a select network of computers. Using Distributed Ledger Technology (DTL), the data within a blockchain cannot be duplicated, allowing it to be used to conduct secure transactions.
Blockchain platforms have been used as the basis for cryptocurrencies and for supply chain management, enabling businesses to securely track their goods and services. It is known to be almost immune to hacking attacks as the data is stored within an entire network.
cryptocurrency
Cryptocurrency, a digital currency, can be used both online and offline. It is managed and created by those who buy it. The most well-known forms of this payment method include Bitcoin, Ethereum and Ripple. Currencies are all about one crypto wallet managed. This encrypts the transactions of the users. The decentralized system uses cryptography, a method that ensures secure communication and does not require a central third party.
mint
The term “Mint” refers to the process of creating an NFT and involves the creation of a unique certificate of authenticity for a specific asset. As part of the process, a creator can specify an asset’s details, including information about who owns it and how much was paid for it. This information can then be published on a blockchain to be subsequently sold, bought and traded.
Metaverse wallet
A Metaverse wallet, which can also be referred to as a digital wallet or crypto wallet, allows its users to store cryptocurrencies and conduct transactions. This form of payment requires a crypto wallet to manage, track, and pay for assets. Some versions of the Metaverse wallets also allow users to store purchased NFTs.
decentralization
In the context of managing digital assets and blockchain platforms, decentralization means transferring control and decision-making from a single person to a larger network. This process aims to reduce members’ trust in a single person and spread authority over a group to create a fairer service.
Decentralized Autonomous Organization (DAO)
A decentralized autonomous organization (DAO) is a blockchain-based organization run by its own users. Contracts managed by a specific group can determine the rules and governance of a DAO, which in many cases grant users voting rights and governance of a specific Metaverse-based project. The concept aims to make the metaverse a more community-oriented space by distributing responsibilities.
phygital
The word “phygital” is a combination of the terms “physical” and “digital” and denotes the marketing of an asset, be it a piece of clothing, a work of art or something else that exists both digitally and physically. Many brands have taken advantage of this format to give customers the opportunity to own a physical and digital copy of the same item. One can also speak of a “digital twin”.
Creator economy
An evolution of influencer culture, the creator economy in the Metaverse refers to individuals, brands, and social media influencers creating their own content that makes them money. These can be activities in the virtual world like selling NFT assets, designing products, hosting events and more that followers can identify with online. While TikTok, YouTube, and Instagram have all been leaders in this space, live streaming platforms like Twitch have continued to fuel this trend.
Internet of Value (IOV)
The term Internet of Value (IOV) is a term commonly used to describe technologies that rely on decentralized operations, such as blockchain and cryptocurrencies. It is a global payment network that allows users to transfer value, assets and data in exchange for monetary value. This can include stocks, voting rights, intellectual property, music and much more. It is also possible to connect physical objects to the internet via this function in order to control them remotely.