Rise of the Avatars: Their Future in Gaming, Fashion and Music

I recently hosted an industry roundtable about the rise of avatars in a variety of entertainment and retail businesses, from gaming to fashion and music. So much creativity on display. Great brand partnerships. A thriving marketplace. Unprecedented levels of engagement. Yet during this lively conversation, my mind kept returning to one thing ... Roblox.

When Roblox, a game once known as Minecraft's less worldly cousin, recently raised over $520 million at a valuation of $29.5 billion, it turned more than a few heads. But despite the eye-watering numbers, shrewd industry followers were more intrigued by the company's purchase of digital avatar startup Loom.ai. After all, what would the game known for lo-res, blocky character design want with a company that was creating some of the most advanced digital avatars in the industry?

Perhaps the team at Roblox recognized the recent stratospheric growth of avatars in video games and across multiple digital platforms, and decided that if they were going to compete with the big media and tech companies of the future, they would need access to the most detailed digital doppelgangers in the space.

Avatars may seem like they've come out of nowhere, but in actuality, they have been a part of our games and digital experiences for decades. Ever since the early days of RPGs and sports titles like Madden, avatars have been there to represent our gaming selves—albeit sometimes in the most rudimentary ways. They may not have looked exactly like us, but buffing the stats of your warrior or NFL running back connected you to the collection of pixels you were playing on-screen and enhanced the game experience.

Like all things in the digital realm, the tech improved and became more accessible. We were able to build more lifelike and emotive characters than ever before. Still, the tipping point had not yet arrived. Avatars played crucial roles in games like Second Life and with creative artists such as the Gorillaz, but full-on adoption of the technology wasn't there—and we were unable to see what was really possible.

Now, sparked by the need for social interaction during Covid and innovative startups like Genies moving avatar-tech from 2-D to 3-D, the moment is here. The intersection of creative people and forward-thinking brands inside the metaverse have given digital avatars, and the corresponding revenue they can generate, that push into another orbit—most notably in the areas of gaming, music and fashion.

Welcome to the Skins Game

Some 2.5 billion people have spent over $100 billion on digital goods, and in-game character skins have become a bigger part of the gaming market than even the most optimistic forecasts could have imagined. What began to take flight with an array of hats in Team Fortress 2 and knives in CS:GO—cosmetic enhancements that offer no advantage in terms of gameplay—has been supercharged thanks to, unsurprisingly, the biggest game in the world, Fortnite. Even with the loss of mobile versions of the game this past year, Fortnite earned Epic Games an estimated $4 billion in 2020, with a significant percentage of that coming from the sales of co-branded skins from Marvel, Sony and other sought-after brands. While other games may lack the user base or partnerships of Fortnite, we no longer need a proof-of-concept when it comes to determining if gamers will pay to customize and costume their avatars in ways that are meaningful to them. It's already happening in a big way.

Digitally Dressed for Success

You don't need a degree in psychology to recognize that human nature is the same whether you're in the digital world or IRL. Universally, when it comes to our appearance and how we are perceived by others, we want to be noticed, respected and adored.

In the real world, it's why we shop for clothes that flatter us or make us stand out. It's why we go to the gym or have plastic surgery. Inside the metaverse, it's the driving force behind why gamers are willing to spend their money on high-priced fashion items and accessories to dress up their avatars. We want our digital selves to look as great as we do—maybe even better.

With traditional retail sales down during the global pandemic, fashion brands like Gucci and The North Face have recognized this new market and entered the space. The North Face offers in-game gear for Pokemon Go while Gucci has partnered with Genies to offer apparel and accessories for its celebrity avatar clientele—all of which can be purchased by the consumer to accessorize their own alt-persona.

To track the evolution of fashion and avatars, look at the concept of the digital runway show. Initially a novelty to help brands promote their lines while under Covid, we saw elite fashion brands use avatars to showcase their real world designs. Then the avatar and digital goods market began to grow. Now, we're seeing an influx of apparel brands presenting similar digital collections as before, BUT the apparel on display can be purchased both for human and avatar. The circle is complete and the paradigm has changed.

The Song Does Not Remain the Same

The godfathers of the music-avatar convergence, Gorillaz created a fully fleshed-out animated universe built around the band and its music. Every band member had an avatar and a unique personality and style. The images worked in concert with the music to help sell the band. Years later, Riot Games would take this a step further with K/DA, an avatar-only Kpop group built from whole cloth with a single objective: expand the reach of the company's hit game League of Legends.

The brilliance of what Riot has done with K/DA is the manner of just how well it all fits together. Each member of K/DA is an actual legend from the global hit game, reimagined as a modern, musical version of themselves. The game promotes the band and vice-versa.

The next step for the music industry is coming from artists like Teflon Sega, who is an original persona reflecting the artist, his music, videos and public appearances. In a sense, it isn't even technically correct to call him an avatar—though he exists in that digital form. What the avatar provides Teflon Sega, and other artists for whom he is blazing a trail, is freedom. Creative freedom to experiment musically and visually, and to appear in the metaverse in multiple places at once, fully customized to reflect that setting. There's a limitless future here, and it will be exciting to see how it plays out.

I Dream of Genies

To understand where we are heading, it's worth looking at one of the leading avatar creators, Genies, who, in addition to making the jump to 3-D avatars, have signed numerous celebrities and artists seeking to plant their flag in this space. Having a great-looking avatar is no longer just a novelty for someone like Cardi B. It is a chance for her to make multiple digital appearances simultaneously, or partner with Hermes on a new handbag, then monetize her avatar in the digital goods space by offering a limited number of the digital bags for sale. A new marketplace is being born via the avatar-brand-consumer relationship.

But there's something that Genies is doing that may be the most essential next step in the evolution of the avatar. The company is "appnostic," so your avatar can be used in multiple environments and across different settings. This universality is absolutely crucial to continued growth. If we can buy Rihanna's Fenty jacket for our avatar, it is that much more valuable if it can be seen everywhere we virtually go. Already providing an SDK for companies to incorporate their avatars and assets into their apps, Genies is well on their way of unifying the digiscape—and making our dreams reality.

So where do we go from here? The line that separates the physical and digital worlds will continue to blur as more and more people grow comfortable with avatars as artists, influencers and representations of themselves. More adoption, and if Genies' has their way, unification, will bring more brands into the space. This will further drive revenue and attract more creative players pushing the technology to new places. It's going to be fun to see where it all goes next. Avatars aren't here to replace us, after all—just make life more interesting.