Did the Nikeland Metaverse Project Fail?

Let’s deconstruct the myth about Nikeland being an instant success and proof point of why brands need to enter the #metaverse because you’re going to be in for a very big shock.

I see these overinflated numbers and exciting claims being thrown around everywhere right now, ranging from 5m to 21m visitors to the Nike experience in Roblox but it’s just not as simple as you might think.

For a start, the official number reported by Nike themselves at a quarterly earnings call was (6.7m) 7m visitors across 224 countries. What they didn’t report (and most likely won’t know or will never reveal) is just how many visitors are returning over again.

We also don’t know just how much of this is tied to Roblox’s user growth, which has exploded from 16M in 2019 to 54M in 2022 — it could very well track that new players entering Roblox are naturally curious and want to dick about in Nikeland but don’t have much brand affinity with them before and there’s no way to track if they do when they leave either.

Now we get to the scary part, the bit that is going to rattle the marketing dept because the newly appointed Chief Metaverse Officer sold them the dream and they’re picking up the tab.

Nikeland is more than just a virtual storefront. This is the bit everyone seems to ignore, including the recent woeful attempt by Bloomingdales to create a 3D retail experience.

Nikeland is a store, with a branded goods experience, celebrity endorsements, physical retail activation, and mini-games that are constantly being released and can be fully interacted with on the Roblox platform.

Nike spent a fortune on ad spending across Twitter and Instagram and also used a song by Drake to attract a particular demographic. $60k on Instagram to net 4m views across two adverts, and this doesn’t include retargeting spend. They’re one of the most followed accounts on Instagram, but that’s no overnight success.

And that’s money that some businesses can’t even allocate annually and it doesn’t take into account the cost of building the experience in Roblox in the first place!

Nikeland visitors could participate in games such as tag, the floor is lava, and dodgeball with their friends and allowed visitors to create their mini-games using in-game elements, including tennis court patterns and nets, basketball hoops, and benches for passive users.

Nike used its House of Innovation in-store experience to push the boundaries even further. For the month-long initiative, Nike turned the kids’ floor into an augmented reality version of Nikeland, allowing shoppers to use the Snap lenses to alter their 3D avatars with Nike products and play games.

Aside from roping in Drake, they also leveraged LeBron to draw even more visitors into their branded metaverse experience.

Celebrity endorsements don’t come cheap.

Are we still keeping the score?

And all this still doesn’t take into account the $1bn they paid to acquire RTFKT and turn it into Nike Virtual Studios to create the experiences in the first place.

“With Nike Virtual Studios, our vision is to take our best-in-class experiences in digital and build Web3 products and experiences to scale this community so that Nike and our members can create, share and benefit together.”

Nike Digital now accounts for over 25% of its revenues and was recently boosted by the $185m it made on its NFT collection.

Now — tell me just how much of overnight success and replicable Nikeland is for every brand and business that is attracted to the metaverse and lured in by Web3 this is.

Now tell me that when you’re approached by an agency or startup promising to build you an experience in The Sandbox, Dececntraland, or even Roblox that they’re also guaranteeing it’ll be a massive and easy success, and that they’ll point to the numbers of Nikeland as proof.

Because there are going to be a lot of empty virtual worlds and emptied marketing budgets over the next few years for organizations that fall for the slick sales pitch.

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