- The metaverse won't succeed without a reliable, trusted, and easy way to pay for products and services.
- Whichever system or systems are created, forecasters predict there will be trillions in value exchanged within the next decade.
- The sky's the limit for innovation. In these early days, businesspeople should be thinking about how the metaverse can be incorporated into business and sales goals.
Venesulia Carr (00:10):
All right. Good afternoon everyone. Thank you all for attending. I am Venesulia Carr, CEO of Vicar Group. I'm also the host of the television show down to business with V where we talk about cybersecurity information security and fraud mitigation. It's the name of the game. So we are excited to be here today to talk to you about Metaverse shopping, how payments will work. I have with me today the esteemed Mike Storiale of Synchrony Bank. He is the VP of Innovation there. Mike, thank you so much for being here.
Mike Storiale (00:42):
Thanks for having me.
Venesulia Carr (00:44):
I'm ecstatic about this conversation and I cannot wait to get started. So for those of you who are not aware, the Metaverse is not coming. It is already here. So Mike and I are going to be talking a little bit about what the Metaverse looks like currently, the current landscape and what's happening there, which is a lot. We'll get you all caught up and it might shake you a little bit, might make you excited. It might make you run from the room. So we'll see what happens. But Mike, thank you so much for being here. Yeah, thanks for having me and sharing your expertise. So let's start off with, for those that don't know, what is the Metaverse?
Mike Storiale (01:23):
Yeah, so the Metaverse is an immersive experience. It's going to be digital, but just like there's no one website, there will not be. One is very similar to websites in the sense that it's going to bring us these different immersive experiences that might feel unique dependent on where you're going. So for those of you that have experienced some of the ones that are already out there, like a robots for example, that feels uniquely different than then perhaps Minecraft would feel and we're going to expect that to continue to happen, but there's going to be some interoperability there that's going to be really unique compared to the way that we see the world today through traditional internet.
Venesulia Carr (02:05):
Absolutely. We're hearing it build as the next iteration of the web. So this is where our web experience is headed. And just to kind of springboard off what you talked about the way Zoom facilitated us all collaborating during covid, what the metaverse has the potential to do, so very exciting times. You talked about the inoperability and how there may be some impacts to that. Let's talk about that because of the implication of multiple talk about it.
Mike Storiale (02:43):
So interoperability is really brought on by blockchain and web three, which is what's powering a lot of the metaverses that we're starting to see. I think the easiest way to think about it, and we touched on this in some prior sessions, is that I'm going to own things whether that be my identity or physical ownership of digital goods or any number of additional things that people will eventually create because we have a long road ahead of us and I'm going to need those to be able to move from one space to the next. And so that interoperability means that yes, my avatar that I've created perhaps needs to be able to move between the metaverse that Disney has created and a metaverse that meta has created. And maybe they do look different. Maybe not every single piece moves. Maybe when I go into Minecraft I become very pixelated, but I need to be able to adjust and bring the ownership of the things that I have from place to place in order for this to work.
Venesulia Carr (03:38):
Absolutely. You talked about two things that I want to springboard off of. Number one, the pixelation. So we know that right now the internet as it stands does not have the capability to offer us that glossy experience that we're used to with our cell phones and big screen TVs. So there will be some catching up when it comes to that. So I do want to kind of give you guys a warning. If you do venture in, it might be a little pixelated, it might not be what you're used to, but Mike, you also touched on the avatars moving between the Metaverses and how we'll be purchasing goods there. And then within that purchasing, wanting to move those between the different types of Metaverses. Is there more that we should be looking at to facilitate that or how is that going to work?
Mike Storiale (04:26):
Yeah, I think there's a couple pieces to unpack there. I think one, we all have to kind of recognize the elephant in the room, which is that the trend of the metaverse has softened over the last six months and that's going to naturally happen. So when we talk about it feeling a little pixelated now, I think of the evolution to where we're at today on the smartphone, kind of going from Palm Pilot to Blackberry to original versions of the smartphone, and then it still took us another 10 years before we had a smartphone capable of TikTok and a ton of incremental innovation had to happen in between there for that to work. When we think of the Metaverse, we're in a really similar space. I think we're probably in the Palm pilot phase where there are limited use cases. There are probably any of you could think of six really good reasons to use a VR headset, and you're probably not going to want to live inside a VR headset for a long period of time.
(05:19)
I think when we think about shopping though, there are some experiences today that really don't exist very well in our current digital landscape. One of the ones that I love to focus on is the wander, right? If you guys ever get to the very end of an experience at the end of a shopping season, let's say it's Christmas time and you need to find that one last gift for your mother-in-law, that is not going to work well online. Online is really great for the item that I know I need but is really bad for the wander. And so Metaverse perhaps now starts to open up some of the things that we still have not been able to solve 30 years into shopping on the internet. I think the other piece you touched on is what am I going to buy and where's it going to go?
(06:02)
Earlier again, in a prior session we talked about the idea that Web three NFTs all have to have utility in order for it to serve some purpose. So it's possible that we're going to see that there will be NFTs that people are going to want to purchase that serve them utility, whether that be access or clout of some kind, which while that might sound silly to some, is really important to many. I think the other question is going to be as I purchase those things, whether it be subscription access to something, we're going to need to be able to move that from place to place. And so perhaps I'm buying clothes, perhaps I'm buying special features, perhaps I'm building new rooms or designing new spaces.
Venesulia Carr (06:48):
I love that you touched on the buying clothes. So for those that are not aware, fashion Week was held in the metaverse for the first time in March of 2022. The fashion industry is not the only industry that's taking this seriously, but they are one of the many. For sure. You can actually buy a one for one of your outfit, whatever you're wearing right now, you can buy it. The big brands are already there, Gucci, Prada, you name them, they're there. So there is the potential for that and not only the potential that industry is driving this, absolutely, they're holding forums like this about what's going to happen with retail in the metaverse. So Mike, if you would just talk a little bit about how the infrastructure of payments will be impacted in that scenario.
Mike Storiale (07:43):
Yeah, so I think one of the first things that you probably wonder is why would I want to buy the item that I have in the metaverse? I think that's an interesting question that we are asking as well. Again, I think some of that does go back to utility though. There's going to be times that people say, in order for this to feel authentically me, I need this. We heard not too long ago from one of the big players in the industry that they currently have. I think it's somewhere in the vicinity of 2 million avatar combinations that you can create, but there are nine plus billion people in the world, which means that nobody is going to feel authentically like themselves in the metaverse today. And so to your point about retail working in the metaverse, there's a lot of conversation around how they're going to create not only the sale of the items, but the sale of experiences.
(08:35)
And so I want to use an example. I'm really close to one of our clients as American Eagle. We've had some really great conversations with them over the last year around how they're using the Metaverse. They've created this beautiful immersive experience inside of Roblox, and yes, they have things that are authentically American Eagle like clothes, but they also have experiences like concerts that attract their audience in a way that we probably saw brands start to pivot and explore into social media. Call it 10 ish years ago, payments could probably work in about three different ways. One is the really simple space where we just need to play with the existing rails that we have, so the current networks that we have need to work in that space. The second is in cryptocurrency, and I think there's a lot of questions there. Right now, every metaverse has their own currency of some kind, whether we want to call it crypto or not.
(09:31)
There is some form of currency to play. So if you're in decentral land, it's manna. If you're in Roblox, it's Roblox. There's always going to be some sort of currency right now. And then I think the third is what are the possibilities we're going to have that we can enable that don't exist yet? I don't think any of us saw Apple Pay coming in 2007. I don't know that any of us could have seen the way that APIs 15 years ago to today, were going to impact the way that we're integrating buy now, pay later at checkout. And so those types of questions around how we're going to take the pieces of technology and integrate them into the metaverse, that's kind of the third angle that I think is going to be most disruptive.
Venesulia Carr (10:12):
I agree with you and Mike. You had done something that really excited me about the Metaverse conversations. It's the event pieces of it that are taking place. Kevin Hart, the comedian has entered the metaverse space. He's holding his standup comedy shows there. The experiences that you're talking about, these are not coming you guys, they're already happening. So when he's talking about this theme park or this event experience happening there, it's already happening. So be I want to drive that point home because when we think about the metaverse, we're thinking forward future here.
Mike Storiale (10:52):
And I think it's this misconception sometimes that there's an attempt to replace physical interactions with digital interactions, and I don't think that's going to happen when we look at all of us using our smartphone. Sure, we certainly are glued to a what sometimes feels like an appendage, much more than we ever thought we were going to be looking at a tiny screen, but at the same time, it augments our life. And so we were talking out in the lobby before about, I think the concert to be at this summer, which is Taylor Swift, and so there's a world perhaps where you couldn't score tickets for 500 bucks, but you would happily watch the event that's happening in your city in the metaverse for 50 bucks. And that is an augmented experience where perhaps that's going to open the door to incremental sales, it's going to open the door to incremental experiences. It's going to mean that maybe we're able to serve very different audiences than we could serve before.
Venesulia Carr (11:54):
Absolutely. Those concerts, by the way, are already taking place right in the metaverse just so you guys are aware it's not coming. These are things that are already happening. So Mike, when we talk about let's shift back toward the companies and let's talk about how long this is going to take for them to realistically be able to to interface in this Metaverse experience.
Mike Storiale (12:17):
So I think there's, if you're running a company that hasn't explored in the space, I would encourage you to do that. Exploring in the space doesn't take a whole lot right now. You probably know teenagers who are in Minecraft and Roblox on a regular basis, which means that your UX designers and engineers can certainly do the same and so exploring and it is just going to get you a lot of really good answers on how does this work, what is it clunky about it? What is a space that we need to lean into and what are the questions that we have? I think the second piece of that though is really trying to think about where you can move and build things from there. As companies are starting to focus on where the metaverse is moving, remember that there's going to be an astounding number of incremental innovations that have to happen between now and this really taking off.
(13:08)
There's been rumors that this spring summer at Apples WWDC conference, we might finally see their version of a headset, but there's still a lot of blockers to overcome. For any of you who have used a VR headset that they're heavy, they're clunky, they make a lot of people feel sick. Candidly, at this point, there's not a great transition between physical reality and virtual reality, and there's not a great input device. And so right now we're still holding controllers. Perhaps we're swiping in the air or using an ancillary device, and none of that is going to scale to mass adoption. And so that's where I think we still have a lot that we have to overcome, but that doesn't mean you shouldn't be exploring in the space today to figure out how you could add incremental value into it.
Venesulia Carr (13:59):
Yeah, absolutely. And I would encourage you to, if you're interested, have your people not only in there seeing what other companies are doing, how they're using it, because they are already there buying land, building out storefronts and just exploring with the option. There was one specific, I think it was an attorney in Florida that was looking at how are we going to man this space? So they were building and toying with the space, so a lot can be done there.
Mike Storiale (14:32):
That's true. And it can get expensive. Yes. I will be really honest in our first exploration of our own metaverse build out, we didn't consider the fact that you have to know how much land you will need, and we built it four times too big, and that sounds like a really silly thing to do, but that's not a question you have when you build a traditional digital property. Obviously it might not be great for me to build a website that has entirely too many pages, but the incremental spend doesn't go up by 400%, and so there are a lot of those key learnings you can get really early on.
Venesulia Carr (15:10):
And I love that you likened it to the webpage. That is something that you want to, as you're exploring this concept, liken the metaverse to the internet. So remember how there was a time when we start to do business, people say, you have to have a website. What's coming is next. They will be saying, you need a metaverse space. So the physical metaverse space is likened to that web space.
Mike Storiale (15:41):
And I do think it's going to be we're follow a really similar trajectory. So if you all think back to when maybe the businesses you were working at at the time decided to first get on the internet, it was very skew morphic. We took a trifold brochure and we put that on the web. There was nothing special you could do. In fact, I think there are still some pizza restaurants in my town that have their trifold literally on the web, but that was the initial start, and it wasn't until years later that we were able to now start to say, well, now let's leverage the technology to do something better with that. The same exact thing happened with the smartphone. I use TikTok as an example because in order for us to have TikTok today, you have to have a front facing camera and the ability to livestream and really robust cell networks and amazing processors on the phone. And if we think back to 10 years ago and trying to upload a single photo when you were out in the wild, that felt next to impossible. And so there's all of these tiny pieces that have to fall into place as this continues to evolve.
Venesulia Carr (16:47):
Yeah, exciting, interesting. But I'm telling you, it's not coming. It's already here. So Mike, we touched on a few of the industries that are already active in the universe that have, is there, tell us a few more and what people are doing. Confidence are doing!
Mike Storiale (17:05):
Yeah, so I think we touched on where retail is moving. I think that's a really fascinating space. You mentioned luxury goods and I think clout online has always been important and is probably going to continue to be important in the metaverse. We've seen a lot of entertainment move into the space. It's a really great use case because you might be able to take something that was a nascent group or a nascent fan and bring that to a large swath of people, which is really interesting. I think there's also a lot around collaboration. I will say I've taken some one-on-ones in the metaverse and I actually feel more engaged in a one-on-one in the Metaverse than I do over Zoom, for example. I still feel most engaged in person, but it's certainly better than when I am not in an immersive experience. I think there's also going to be a lot of times that we see it used as an augmentation vehicle, so if there are spaces that, and I mentioned this with concerts earlier, if there are spaces where we can get more people to participate in something, I think that's where we're going to see, and then ultimately we're going to see net new, net new industries emerge out of this.
(18:20)
We're already talking about how fitness could work in this space. Again, I think that's a hardware problem, and then I think there's going to be a lot of collaboration.
Venesulia Carr (18:28):
Exciting. I like that You touched on the ability to train in the Metaverse to do onboarding in the metaverse that's already happening. Companies are using it specifically for that and the fact that you guys are doing it, did you do this with Synchrony or
Mike Storiale (18:43):
Yeah, so we're actually exploring how we can use virtual reality to start to get people feeling more immersed into our culture when they're new to the company. Yes. Yeah, I think that's a really interesting question. We are a flexible first culture, which is really wonderful for all of us as employees, but if you think about what it's like to go net new to a company, you can sometimes feel like you're out on an island. And so we took some of that feedback and we've understood from our employees that the first time they're going to headquarters, there might be anxiety around how do I get around? How do I navigate where I'm going to, how do I train with other people that are in the same season of their career as me who maybe just started here? And so trying to figure out what those right opportunities are for people to be able to engage.
(19:33)
I don't think anything that we're doing today is going to be how it's done two years from now, but I do think it lets us test and learn and figure out how do people collaborate better together. We did a session where we were all whiteboarding together in the metaverse, and I will be honest, I think all of us were more engaged. Now, not all of us liked the feeling of it, and I think that's something that we still have to solve for. One of the takeaways we got from it candidly, was that the men felt much more engaged than the women did, and they likened it or associate that with their avatars. The avatars didn't represent women as much as they represented men, and so they didn't feel authentically themselves in the space. So there's a lot we've got to overcome in order for this to work, but I do think it gives a really great opportunity for how you engage your people as
Venesulia Carr (20:23):
Well. Yeah, absolutely, and I love that you touched on the diversity piece. There was an article with reports that the same diversity issues that we experience here in the 3D in the real world will be present and have to be addressed in the metaverse. Yeah, I think so. So very interesting and interesting, the take on the employees, so something for you all to be thinking about as you're moving forward, and I love that you're the VP of innovation, so of course you guys are in the metaverse doing onboarding and training. Let's talk a little bit about there's a traditional way of doing things. Let's talk about the traditional option for payments in the metaverse versus the digital currency. What are the options there?
Mike Storiale (21:07):
Yeah, so I mean I think moving networks into the metaverse is going to need to be table stakes for this to work. People are going to adopt new payment technologies, but the same way that we've been talking the last day and a half around digital wallet adoption, everybody has the ability now to have a digital wallet, but not everyone has adopted it, and so of course we're not going to be able to tell everyone that they need to move into new payment methods. I think the second, and I mentioned this before, is going to be what about the people who do have a desire to have interoperable currencies? So whether that be the ability to transfer my manana into Bitcoin, into Dogecoin, whatever that might be, I think that's going to be a big question. The final one is really about how do you build net new experiences, and that's where when we look at the last few years of payments on the, I guess we have to call it the traditional web now payments on the traditional web has really started to go API first.
(22:04)
We've seen headless commerce really take hold, and those trends have really pushed retailers and brand builders into a space where they are creating experiences that are unique to the space they have. I think when we get into the metaverse, the same thing is going to start to happen where you can say, I have a space that feels this way, and so this is the experience I want and these are the connectors I'm going to pick to be able to build that. Of course, though, to your point, the networks need to work in that space and we're going to have to have the table stakes.
Venesulia Carr (22:36):
Yeah, absolutely. And I agree with you. There are going to be people that are not ready to move into digital currency or to want to change their digital currency depending on which platform they're on. So it will be good to have some form of traditional payment option within the metaverse, because right now it's just the digital currencies for the platforms!
Mike Storiale (23:02):
I think we're going to need to figure out how all of that works, right? Yeah. There's a long road ahead to getting that to be ubiquitous across all of the different platforms, but you have to imagine the large players that are now starting to enter the space, the Disney's of the worlds, the metas of the worlds, recognize that a single payment method that is unique to their space is not going to draw in the masses.
Venesulia Carr (23:27):
Right. Agreed. Blockchain, let's talk about blockchain specifically in the metaverse. Yeah. And the benefits or not?
Mike Storiale (23:39):
Yes. I mean necessarily blockchain, and somebody mentioned this earlier, but I'd like to think of blockchain at this point as infrastructure liken blockchain to the cloud, it is a tool that allows you to build certain products. Not every product you want to build should be built on the blockchain, but there are plenty of times where there's a really good use case. I think Metaverse are one of those because we need the interoperability for it to work. So I need to be able to mint smart contracts that allow people to have certain aspects of their personality or their avatar or their payment credentials or other authentication. I need to know who they are from site to site to site to site. That's not a thing that has been as important in our traditional web space because people have methods to do that, so they log into meta, for example, and who they are on Facebook might be uniquely different than who they are on TikTok, and we've seen that as a social media networks for example, have evolved.
(24:43)
I think as we look at Metaverses, if people are going to invest their time in this, they are going to expect that the pieces can move. Blockchain enables that interoperability to happen, and because it's immutable, which means it can't be changed, there is going to be an easier time letting this stand for the long haul. Now, the difficulty with blockchain that I think we all just have to clear the room and admit is that getting a large percentage of anyone to agree on how to do something so it can be interoperable is a really complex business problem. Interoperability is not easy because it means you need a lot of people to agree on how to do something. And so hopefully starting net new helps because we can recognize that upfront and recognize that the promise of blockchain is interoperability, and so we're not going to have to re-engineer something later on, but that's going to be one of the hardest business problems to solve. Certainly not a tech problem at this point. Right.
Venesulia Carr (25:43):
Yeah, agreed. We talked a little bit about what Synchrony is doing in the Metaverse as far as your onboarding and your training. What else are you doing or foreseeing in the near future doing within the member of our space?
Mike Storiale (25:58):
So we've recreated some of our physical spaces, which has been a really interesting learning curve. In a lot of those experiences. We've created pieces that we couldn't create in person, and so for example, in one of our experience centers, which is a space that we bring our clients through, we're able to create these kind of magical moments that I can't physically create in person. They're not real, and so that that's been a lot of fun. We can also transport people into immersive demos and journeys. So you imagine a world today where you say to somebody, Hey, I want you to imagine that you're shopping at a store, and now I can just say, all right, we're going to go and shop in a store and show you how this works and I can bring you into that space. So those types of things feel really unique.
(26:45)
We're also trying to figure out as we build out what we would call mock retail stores, where the use case is strong and where the use case is weak, I think there's this tendency with new technology for people to say, it's not going to work because this outlier is not going to stand up in that space. The answer might be, yeah, that outlier's not going to work in that space, not without a whole lot of incremental innovation happening, but we need to understand why it's not working, figure out what we would need to build to get there and ultimately decide if it's just a place that we need to pivot away from.
Venesulia Carr (27:22):
Exciting. I love the idea that you're already having these magical experiences within this space, and for those of you that have not had a metaverse experience, just imagine immersing in a Disney movie. Just imagine that. So all of those capabilities and possibilities are available there as well. So you can make it as standard as you'd like it to be or as magical as you'd like it to be. So Mike, as we close up, we've got about two minutes left. What do you see happening next in innovation for the Metaverse?
Mike Storiale (28:00):
Yeah, so I think the trend is going to continue to soften. That's normal. I think this, there's tendency with watching new technology trends for people to say, oh, the metaverse is yesterday. Today is generative ai. Let's be clear that I think generative AI could make the metaverse a whole lot easier to sustain because I could describe something that I want to create and it could create it for me versus before me having to learn how to do that myself. But we're probably going to see a softening for a little while. The thing I'm watching most for is where is the catalyst moment that will propel it forward? Will that be a new piece of hardware that will make this more available to the masses? Similar to what we saw happen in the transition of smart devices from Palm Pilot to Blackberry to smartphone, will we see the ability for people to integrate more native digital experiences into it?
(28:57)
As we mentioned a minute ago, it's still not easy to use traditional payment methods in the Metaverse. It's still really clunky as far as an experience goes. So I'm looking for the catalyst because for all of us, I think in the room, unless there's somebody here that maybe is driving the strategy of the Metaverse at Meta or Disney, we are not going to be the catalyst. We are going to be impacted by the catalyst, and so I'm watching for where those moments are going to happen so that then we can be prepared to capitalize on.
Venesulia Carr (29:27):
Yeah, exciting. Well, in closing, you guys, the metaverse is not coming. It is already here. So whatever it is that you can do here in the 3d, you can do in the metaverse, whatever you can buy in the, you can buy in the Metaverse. This entire conference could technically have been held in the Metaverse. Sure. So thank you so much, Mike for sharing your thanks, your knowledge and wisdom and insight on everything. These conversation, I'm telling you, I could have this all day long every day. I'm still not done picking his brain, but thank you all so much for coming. We're excited to have you here. If you have any questions, the floor is open and our AB guys will pass the mic.
Audience 1 (30:19):
Thank you. Hi, that was great, and I just have a question around what is your recommendation for financial institutions specifically that may not have the assets or the resources to play in the metaverse and explore that? What is your recommendation for us to prepare for when that moment does come, that propels us forward so that we can actually play in that space so we don't get left behind? We tend to, with these technology advances!
Mike Storiale (30:51):
I think the first is just make sure that you're developing your opinions on it. There are a lot of times that even as a larger institution, I don't have the resources to go and explore a new space because of other prioritization, conflicting prioritization. Developing an opinion on it and watching for the things that you think are going to happen I think is going to be most critical. So understanding, hey, if I see this start to move in payments, what am I going to tell my executive team? How do I explain to them why I care about this? I've shared with my own team before. I think the biggest wins in my organization is when I can hear my executive team parrot back the opinions that we have, because that means that it's permeating throughout the org. That is a win in innovation. Even if you didn't develop something because you made cultural change, and then as the moment is right, you're going to have built that foundation.
Venesulia Carr (31:48):
And I'd add to start developing your use case. Now, if you can show and prove to your teams that there is already action and traction within the metaverse as it stands, then certainly you need to be preparing for the future within that space as far as segmenting dollars for it. That'll be something that's on a company by company and budget by budget basis. But you've definitely got to develop that use case to show them the fashion industry's moving forward. Big banks are in the entertainment industry is there Ripple, who was Brendan's organization that was just sitting here. They're invested in the metaverse as it stands. So imagine if all of these industries are already invested. Technically, we are already left behind as it stands.
Mike Storiale (32:45):
I would also just say the hard thing. Yeah, so at Bess is here who's one of my leaders, and we've been really open and honest and said, Hey, the trend is softening. That's a hard thing to say sometimes. Yeah, we built something really cool that we're proud of. It's softening right now. That's okay. By saying those hard things, then when you are ready to pounce, it's going to be more authentic. They're going to understand that you weren't just chasing something because you loved it, but that it's exactly, it really is the right time.
Venesulia Carr (33:18):
And also this softening gives you an opportunity to leverage this lapse. You can start building now or moving toward building, at least launching a vision, casting a vision as to what it could be because it's telling you it's not coming. It's already here, number one. But the advances in technology are going to make it such, and I can tell you that the UAE is developing infrastructure right now. If a government is developing infrastructure to substantiate and undergird the metaverse, then they're not the only government, but they're one of the ones that literally have cast the vision and are holding forums on the metaverse. This is not coming. It's already here, and it's just a matter of time before this lapse that we're in is over. And then we're in a whole new era. And certainly I think we want to be prepared for it.
Mike Storiale (34:16):
Well, thanks, Pete.
Venesulia Carr (34:17):
Thanks, Mike. Mike, story Alley, VP of Innovation, synchrony Bank. I'm Kar has been a pleasure being with you all today. We will see you somewhere in the metaverse or the present universe.
Mike Storiale (34:33):
Thanks, Pete.
Venesulia Carr (34:34):
Thank you.