Move Over TikTok, Make Way For Gaming

Luxury brands aren’t exactly known for their pioneering curiosity when it comes to new sales and marketing channels. Most took a wait and see approach not only to social media, but to ecommerce itself. In fact, Chanel continues to stand by its now famous proclamation that it will never sell its core luxury products online. But there is a bolder subset of the luxury world—most notably Gucci, Prada, Louis Vuitton, Balenciaga and Burberry—that are leaders in the latest digital frontier. They are exploring what some may consider a very unusual channel for the luxury world: Gaming. Upon closer inspection, it’s easy to see why. According to gamer insights company Newzoo, women make up at least 40% of gamer personas, and the majority of gamers are over the age of 20, debunking the perception that gamers are mostly teenage boys. Gaming gives luxury brands an untapped channel to court a new—and powerful—community of consumers who are living at the intersection of the digital and physical universe.

Where else in today’s decentralized world can one channel instantly deliver millions of engaged enthusiasts with credit cards in hand? Product integration and endorsements from Hollywood films and celebrities, professional athletes, and musicians helped brands such as NikeNKE
and Armani become household names early in their histories. However, unlike traditional advertising or product integration, gaming offers more than just a chance to increase brand awareness which will hopefully lead to customer acquisition. Games are a sales channel. The entire industry is expected to be worth over $320 billion by 2026, and is already larger than Hollywood and the music industry combined. With approximately 2.9 billion active gamers in the world, luxury brands can tap into and cultivate new customers from the huge tribes of engaged consumers who are incredibly loyal to franchises such as Fortnite, League of Legends, and Roblox. As Business of Fashion noted, “…the real prize for fashion brands on Roblox at the moment may just be starting a relationship with the next generation of shoppers as they grow up spending time in 3D spaces online.”

All of these platforms are as much a place to socialize as they are to play games. Integration of advertising partners into these digital universes creates an experience for gamers that is instantly accessible. Moreover the commercial opportunities go beyond simply dressing avatars—which alone is estimated to be valued at $527 billion by 2030. For instance, the beauty industry has found a captive audience of women watching gaming videos on Twitch, the video game live streaming platform. Charlotte Tilbury, L’Oreal, and Benefit Cosmetics have created exclusive master classes and activations through their sponsorship of esports festival Girl Gamer’s Twitch channel.

Everything is possible, including pop-up stores, runway shows, new product launches, and live concerts. Gaming platforms allow brands to bridge the physical and digital worlds while creating an active, authentic, one-on-one relationships at scale with their community of brand acolytes. Recently, Gucci partnered with The Sandbox, a digital real estate platform, to launch its virtual concept store, Gucci Vault Land. This digital pop-up experience was open to all and provided an immersive journey through Gucci’s archives while rewarding participants for challenges with digital collectibles.

Taking this one step further, brands will, in the not-too-distant future, give the same weight to their virtual real estate and treat avatars as importantly as humans. The walls between physical and digital commerce are quickly disappearing as technological capabilities accelerate. Today a consumer can purchase, for instance, a virtual and physical handbag within the same transaction, or tickets to a virtual concert along with physical concert memorabilia. The possibilities are truly endless. Luxury’s business expansion opportunities within gaming are limited only by the creativity of the brands themselves.