Nonprofits in the Metaverse: Pros and Cons
Nonprofit organizations may be feeling the need to take a stance on the metaverse and make decisions on meta-related activities, like accepting crypto donations. While the metaverse is still being built — and is so new that it’s hard to define exactly what it means — there’s a lot of marketing hype (and money) being wrapped up into it.
Most envision the metaverse as a set of virtual worlds that people can move seamlessly between, doing everything from socializing, to playing games, to buying things — and even making donations. Major consumer brands, such as Nike, Wendy’s and Samsung, are making big leaps in the space, hoping to reach bigger audiences, expand their digital footprints and realize potential new revenue growth.
The metaverse represents a whole new economy, and brand marketers of all types, including nonprofits, are approaching it in different ways — some with enthusiasm, others with skepticism, and some with disdain. As 2023 approaches, few nonprofits have dabbled in the metaverse but many are wondering if it may be time to stick their toes in. However, before making the jump, there are several pros and cons to consider:
Pro: Tap Into the Crypto Donor Market:
The crypto donor base is very philanthropic. In fact, Fidelity Charitable reports that 45% of crypto investors donated $1,000 or more to charity in 2020, compared to 33% of total investors. Crypto donors are also heavily motivated by tax incentives, given they can sidestep hefty capital gains taxes by donating crypto coins instead of cash.
To best attract crypto donations, you need to understand the target crypto owner demographic and where they congregate online. Research shows this demographic skews heavily male, and with high levels of engagement on gaming platforms and servers that the general public may not as readily engage in. Research also shows that the earliest metaverse users are male gamers, constituting a significant overlap between crypto owners and the metaverse. As a critical enabler of transactions within the metaverse economy, cryptocurrency and the metaverse are inextricably linked, meaning the metaverse is a prime place to be for nonprofits looking to access crypto donors.
Pro: The Metaverse Needs Nonprofits
Several internet authorities have expressed concern that as more people set up and spend more waking hours in their utopian virtual worlds, real-world problems like hunger, homelessness and environmental pollution will become less visible — and easier to ignore. Nonprofits’ presence in the metaverse will remind users that these issues are still highly salient, helping to educate and drive awareness for worthy causes.
In addition, nonprofits can leverage experiential marketing to create user experiences (for example, living as a homeless person), which put individuals in others’ shoes, creating empathy and compelling them to both take action as well as spread the word.
Pro: A Chance to Get a Head Start
The metaverse has been called “the next evolution in social connection and the successor to the mobile internet.” While it may still be a buzzy term, the latest statistical predictions are eye-opening, with 74%of U.S. adults expected to join or consider joining the metaverse in 2023. By 2026, 30% of companies will offer products and services for the metaverse. When we draw parallels between the early days of ecommerce (in the late 1990s and early 2000s) and the metaverse of today, it’s easy to see why nonprofits may be wary of missing the chance to get in on something so potentially big.
Con: The Metaverse Isn’t Very Accessible — At Least Right Now
Even as many brands focus on developing ‘meta-esque’ experiences, the fact is the metaverse is still inaccessible to large segments of the population. For example, it costs around $400 for a virtual reality (VR) headset. Until the costs of peripherals and related equipment and services go down, it will be difficult for metaverse adoption to achieve critical mass.
Con: Problems With Hate Speech and Bad Behavior
Like other public internet spaces, the metaverse is prone to issues, such as racism, sexism, cyberbullying and online assaults.
Bad behavior in the metaverse can be more severe than today’s online harassment and bullying, because virtual reality plunges people into an all-encompassing digital environment where unwanted touches in the digital world can be made to feel real and the sensory experience is heightened.
Meta has taken actions to give people more control over their VR experiences. Meta Horizon Worlds, for instance, features a Personal Boundary that users can implement if they want to create and maintain distance between themselves and other avatars. Still, the metaverse remains largely the wild, wild west from a content perspective, and content moderation there is still very much a work in progress, with even children being exposed to hate speech and assaults. Until content is better controlled, some nonprofits may be reluctant to associate with the metaverse.
In addition, nonprofits have to think carefully about all the potential negative implications. The World Wildlife Fund, for example, was recently accused of hypocrisy for minting its own non-fungible tokens (NFT) to raise money for conservation efforts, while using a highly polluting and environmentally harmful blockchain.
Con: No Way to Measure Impact
At the current moment, the metaverse requires a fairly significant investment to get involved, but there is no way to measure the impact. We’re sure this is something Meta will be working on in the coming months and years, but for now, at a time when every marketing dollar counts, methods of assessing ROI from metaverse-focused initiatives do not exist.
The metaverse represents an exciting opportunity for nonprofits in a variety of areas including advertising, brand-building and especially experiential marketing. But there are pros and cons associated with exploring these opportunities that need to be carefully considered. For the time-being, we recommend that nonprofits explore the metaverse in a way that’s authentic to them — not a goldrush — while providing an emotional hook and directly relating to the valuable program work they do.
Luke Dringoli first worked in the private sector with brands like Unilever, Dodge, Lexus, USA Network and STARZ where he used technology to forge connections and build digital communities. Now, as senior marketing technology director at Media Cause, Luke works with nonprofits and organizations, such as United Nations Development Programme, Stand Up to Cancer and Center for American Progress, to use technology — the right mix of platforms, integrations, and tracking solutions — to achieve more impact. There are few things he enjoys more than helping his clients realize that technology can give them back time in their day — instead of taking away from it.