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Big Brands Are Preparing For The Inevitable Virtual Future of Business
As the future of business shifts to the Metaverse, big brands are rallying to get their footing and stake their claims in this new unchartered territory.
Although it is still speculative on what the metaverse will become, companies have begun to hedge their bets and shift to incorporate this new technology and promise of the inevitable virtuality of business, commerce, and communication.
For starters, Hyundai is offering virtual test drives in Roblox, beer brand Stella Artois who has for years sponsored horse racing tracks is now also following suit in the metaverse with it’s sponsorship of the Zed Run, a blockchain-based horse racing platform launched by Australian based startup Virtually Human. Furthermore, Samsung recently introduced the virtual replica of its 837 flagship store in New York City in the metaverse platform Decentraland, and on Friendship Day, July 30th of 2021, Coca-Cola also launched their first NFT collection during a virtual party on the rooftop of their virtual building in Decentraland. Plus, AMC’s fan favorite, “The Walking Dead,” television show collaborated with Gala Games to allow gamers the opportunity to own land as well as earn, find, and trade assets with other players in a play-to-earn gaming ecosystem.
Luxury brands are also getting in on the fun. A digital version of the Gucci Dionysus purse sold for considerably more than it is worth in-real-life (IRL), fetching 350,000K Robux (the Roblox’s in-game currency) which is the equivalent to $4,375 UDS. The actual bag retailed for $3,400. The head-scratching phenomenon prompted tweets such as the one from Alexis Ohanian below.
A Gucci bag in Roblox resold for 350,000 Robux or roughly $4,115. The same purse IRL costs $3,400.— Alexis Ohanian 7️⃣7️⃣6️⃣ (@alexisohanian) May 24, 2021
Remember: this Roblox purse is not an NFT and thus has no value/use/transferability outside the Roblox world-yet it's worth more than the physical one.
Watch this space. pic.twitter.com/m4WjfC1Eq1
In addition, in December adding to their ecosystem of gaming, virtual creations, collaboration, and lifestyle byproducts, Gucci partnered with Chinese trend IP Marsper, a virtual character, and collectible. However, this is not a first for Gucci.
The brand also partnered with Genies, the Los Angeles-based avatar maker platform that allows users to create their own avatars and outfit them in Gucci gear if they so choose. Plus there was a similar collaboration with the South Korean social media app, ZEPETO for ready-to-wear virtual Gucci goods as seen below…
Back state-side with their foot firmly on the gas, Gucci also partnered with SuperPlastic for a collection called SuperGucci that will drop on Tuesday, February 1st, 2022. The collection is a 3-part series of super-limited NFTs co-created by Gucci’s head of design Alessandro Michele and synthetic artists Janky & Guggimon. Each NFT incorporates classic Gucci patterns and comes with an exclusive 8-inch tall white ceramic SUPERGUCCI SuperJanky sculpture, hand-crafted by Gucci’s own ceramicists in Italy. The release is limited to only 500 NFTs available, making it super rare and highly collectible.
Then there is Balenciaga, who became the first luxury brand to partner with the video game Fortnite on a range of outfits for characters, known as ‘skins’. It also released a physical range of merch to coincide with the digital launch.
Louis Vuitton, also launched a video game to celebrate the brand’s 200 year anniversary. The game simply called Louis: The Game, allows players to acquire NFTs, while following the Louis Vuitton mascot Vivienne through the brand’s history and evolution and to fantasy virtual locations inspired by cities including New York, London, Beijing, Paris, and Tokyo.
Dolce and Gabbana genesis NFT collection aptly called Collezione Genesi, fetched a pretty penny to the tune of 1,885.719 ETH which at the time of the sale converted to roughly $5.7 million in total for the nine-piece collection which included 5 physical pieces as well. Here in NFT land, we call that, “phygital.”
The collection was the brainchild of Shashi Menon, the Dubia based founder of the digital luxury platform UNXD, who also happens to be the publisher of Vogue Arabia.
Notable purchasers of this collection include Boston Protocol (crypto-commerce protocol company), Red DAO which was formed to invest in digital fashion, and popular NFT collectors and influencers Pranksy and Seedphrase.
Also, Marc Jacobs and Valentino who collaborated with Animal Crossing to create the Animal Crossing Fashion Archive, where fans can submit recreated designs that are available for use exclusively on the Animal Crossing platform.
Photographer #KaraChung of #AnimalCrossingFashionArchive, tapped her community to collaborate on a set of 20 animated men’s and women’s Valentino outfits available for use exclusively on #AnimalCrossing #あつまれどうぶつの森 #どうぶつの森 . Check our Instagram Stories! pic.twitter.com/guxp9w0qSL— Valentino (@MaisonValentino) May 1, 2020
Adidas also made the foray into NFTs and wearables collaborating with Bored Ape Yacht Club, Punks Comics, and GMoney, a renowned NFT influencer known for sporting his iconic orange beanie ape CryptoPunk.
Not to be outdone, Nike is planning it’s own metaverse called Nikeland on the Roblox platform. They also acquired RTFKT Studios, a digital sneaker and collectible startup, and according to CNBC, in preparation to keep their stronghold on the sports apparel and sneaker market in the virtual space, Nike has sought to trademark their products’ under the category of “virtual goods” based in the US, according to an application filed with the US Patent and Trademark Office in late October. The application covers footwear, clothing, sports bags and even includes art, toys, and accessories.
Perhaps even more importantly, the trademark request protection for downloadable “virtual goods” for use online and in virtual worlds as seen below.
Similarly, in December Ralph Lauren and DKNY also filed trademarks covering virtual and digital downloadable goods for use in virtual worlds.
The best example of why it is prudent for brands to take such precautions and steps to protect intellectual property and trademarks that already exist in the physical goods spaces is the case of LA-based digital artists Mason Rothschild versus Hermes and Birkin.
In May of 2021, artists Mason Rothchild and Eric Ramirez released an NFT called Baby Birkin for what they considered their artistic commentary on the iconic Hermes Birkin brand. The Baby Birkin NFT bag featured an animation of a baby growing inside of the bag. In June it sold for a whopping $23,500 as compared to the real-life version of the Baby Birkin which retails for approximately $9,500.
Although imitation may be the best form of flattery, twice is not so nice. In December of 2021, when Rothchild doubled backed to release an entire collection of 100 “MetaBirkin” bags, with the tagline, “This is Not Your Mother’s Birkin,” Hermes was not amused or flattered. The collection which premiered at Art Basel in Miami featured bright colored faux fur initially sold a mint price of 0.1 ETH, but quickly fetched aftermarket prices of up to the crypto equivalent of $40,000 each.
However, this time around the artist was promptly served with a “cease and desist” letter from the Hermes brand which released a statement to the Financial Times saying,
‘These NFTs infringe upon the intellectual property and trademark rights of Hermès and are an example of fake Hermès products in the metaverse.’
Mason Rothschild took to social media where he let it be known he’s received a cease and desist from Hermès, the French luxury whose bags inspired the art and the project was also removed NFT platform OpenSea. At the time of removal, the trading value of the bags was $1.1 million.
In a response letter to Hermès, Rothschild wrote, “So I got your cease & desist letter. While I am sorry you were insulted by my art, as an artist, I will not apologize for creating it.” Rothschild justifies his MetaBirkin NFT release by likening it to selling physical art prints of art he had created and added,
“It should not be my job to educate you on advancements in the world and the culture of art. Art is art.”
Rothschild also claims the first amendment provides him protection from copyright claims. In a second letter, Rothschild thanked, the NFT Community for their support, however, naturally not everyone was supportive and some questioned his decision to launch a project with clear potential for legal issues.
MetaBirkins are the key to unlocking all my future projects. Guaranteed whitelists, guaranteed airdrops. Endless value for the people who believe in me and my work. It’s all about the journey and I’m just getting started.— MasonRothschild.eth (@MasonRothschild) January 15, 2022
✅ Copped a @MetaBirkins— Metaplug (@metaplug) January 14, 2022
💭 Loved by celebrities and cease & desist-ed by Hermes, it's both a visual and performance art piece
💭 The founder @MasonRothschild has a proven track record in the fashion space and a strong network
Apparently this one is @takashipom inspired! pic.twitter.com/YtMQWSQiKy
With legal entanglements such as these, it begs the question; if new creators carving out their own space creating in the metaverse by way of NFTs, virtual goods, assets, and wearables, although it may be prudent to secure trademarks, is it actually necessary?
Part of the promise of Web3 and building on the blockchain is provenance, the ability to know the place of origin of the earliest known history of something. Building on the blockchain offers immutability with everything being recorded on smart contract in perpetuity. However, should up-in-comers take a note from Nike and the big boys to protect their IP? I would venture to say, it definitely can’t hurt.
VogueBusiness.com reported that in November, two trademark applications were filed in the US by third-parties to use the Gucci and Prada logos in a range of metaverse-related arenas, including “downloadable virtual goods,” virtual worlds and virtual clothing used in virtual spaces, and also on metaverse platforms with user-generated content, such as Roblox, creators are currently selling clothes that feature logos from the likes of Louis Vuitton, Prada and Chanel. In the world of Kanye West, “HOW SWAY?”
Speaking to VogueBusiness.com, Jeff Trexler, Associate Director of Fordham University’s Fashion Law Insitute has this to say…
“A bunch of this could be seen as opportunistic exploitation of the trademark. The Gucci and Prada filings in the US are for individuals, rather than for the brands, he says. This “illustrates the risk to brands in the trademark class system as well as how the class system is adapting to change.”
Gucci has said that it is aware of the filing and is taking steps to defend the brand’s trademarks in the metaverse. Prada also confirmed that the US trademark application is not associated with Prada and stated that the legal department is challenging all similar cases to protect the integrity of the brand.
One of the tenants endemic to the Web3, NFTs, and blockchain space include autonomy and anonymity and also community governance. As the Metaverse and big business converge, what the future holds for the virtual landscape and whether the case of the MetaBirkin and the like will be seen as “fair use” for artistic expression or just plain counterfeits will remain to be seen. A simple rule of thumb would be, to play nice, be kind, and do unto others…