Brands Are Scrambling to Get Onto Roblox. Is It Worth It?

In a world where audiences are constantly fragmenting, the prospect of getting in front of 48.2 million people on any given day is appealing, to put it mildly. That’s why so many brands are flocking to Roblox. Vans. Gucci. Epic Records. The BBC. Netflix. LOL Surprise Dolls. Lego. Nike. That’s just a sampling of the brands that have built a wide range of experiences on Roblox, the social platform best known as a user-generated gaming destination with its sights set on being the virtual gathering place for all the things we do in the real world. It’s also known as the metaverse, a nebulous term for what some say is the future internet where we'll connect through shared 3-D experiences. Brands are a big part of that ultimate goal. An impressive 34 million people attended Lil Nas X’s concert last November on Roblox. About 20 million passed through the two-week Gucci Gardens exhibit, and 4 million attended singer Zara Larsson’s launch party in May. They’re impressive numbers by any standard, but even more so given in-person events came to a standstill thanks to the pandemic. But what is the value of having a brand presence on Roblox? Creating a Winning Brand Presence in the Metaverse: Insights From Vans and Roblox It’s an increasingly important question given the vast resources it takes to create these big experiences—Lil Nas X had to wear a motion sensor suit and rehearse for weeks leading up to the concert, not to mention the hours spent building the online and offline aspects of the performance—by marketers who have only a cursory understanding of what appeals to audiences on Roblox. Tracking on Roblox is in its infancy so it’s not possible to know if an attendee of, say, the Larsson party went on to other Roblox experiences or if a Roblox user who had never heard of Larsson attended her concert after seeing it promoted on the site’s menu. For now, it might not matter. “So many brands were TV, TV, TV, and as a result a lot of them missed the move to social, mobile, Instagram and Snapchat,” Brandon Ross, a partner and media and technology analyst at telecom research firm LightShed Partners, told Adweek. “They were constantly playing catch-up. A lot of brands learned their lesson that they need to start thinking about what's the next popular platform and how do I embed myself in it? And how do I develop the necessary skill sets to reach consumers that will be otherwise tough to reach?” While marketers are building their Roblox muscle, they’re figuring out how to measure success. “I was on a call with Roblox yesterday and we're running through some numbers, and I said, ‘Give me some context. Are these numbers good, are they bad?’” Dave Bell, evp and head of marketing at Swedish pop star Larsson’s label Epic Records, told Adweek. “The reality is it's very early. So a lot of benchmarks are still being set.” Reaching the masses It’s hard for marketers to resist the numbers. In its August Q2 earnings call, Roblox reported that users collectively spent 9.7 billion hours on the platform. In July alone, users spent 3.8 billion hours, the highest of any month since Roblox’s founding in 2006. Perhaps what’s more staggering is that “they’re still scratching the surface” in terms of acquiring potential users, said Ross. That’s because Roblox is making inroads across the world, particularly in eastern Asia and parts of Europe. Meanwhile, listen to any Roblox executive, and you’re likely to hear them tout the increasing age of users. It’s something the platform has been working on by improving its look, feel and sound, the sophisticated brand experiences, and the search and discover feature. And while it’s working—the company reported in August that for the first time it has an equal number of visitors above and below age 13—until recently, the majority were under 13. The way we used to connect with our friends by chatting on the phone or hanging out on the couch, our kids are connecting on Roblox.Barbara Messing, CMO, Roblox Roblox CFO Michael Guthrie, when asked what the strategic advantages of aging up are at the recent Goldman Sachs Communacopia conference, said, “Our ambition is to be a brand that spans ages 6 to 60. We want to get to a billion users. That’s the priority.” He pointed to Apple, Disney and Nike as role models. Goldman analyst and conference moderator Michael Ng pushed Guthrie, asking, “What’s the end goal with brands? To help age up? Is there a big profit pool here?” “It’s so early with brands,” Guthrie said. “In the short term, the question is: How do we get more of them on the platform? For the brands themselves, they have traditional ways in other companies with CPM-driven models to reach those users. They do a lot of that already. This is a completely different way.” The sticky factor Many brands accelerated their plans for a Roblox presence because of the pandemic, knowing people were home and on their devices. For brands, getting onto Roblox now is an investment in the future of Gen Z. They might not have much purchasing power today, but they will. “The way we used to connect with our friends by chatting on the phone or hanging out on the couch, our kids are connecting on Roblox that way,” said Barbara Messing, Roblox’s CMO and an Adweek Brand Genius honoree. “It's the next way people are communicating and getting together in the way you might do in the real world.” And just like IRL, users want their personality to shine through on the platform. Brands tap into that by selling “verch,” or virtual merchandise. It’s an inherently Roblox concept. After signing up for a free account, users select an avatar they can personalize with free accessories and in-game currency (Robux) for more sophisticated items. These developers—and brands—create clothes, accessories and emotes (like an emoji in a text chat, but this signifies an action) to personalize their avatars. Developers receive a percentage of the sale. (Platforms like Fortnite offer different percentages, creating a huge competition for the world’s best developers.) Creating metaverse experiences is expensive and time consuming. But with 48.2 million users, it just may be necessary. Users can text in-game while playing; many talk via Facetime or audio calls. An upcoming Roblox feature is voice, allowing users to talk without the need to call. “They go back and forth between digital and physical—it’s a continuum,” Jamie Gutfreund, former CMO of MGA Entertainment and board member at video measurement platform Tubular Labs, told Adweek. “It's fluid.” As for the notion that the platform is for youngsters, media analyst Ross believes Roblox is such a vital part of social interaction for this generation that it will naturally age up as its young users do, much like Facebook has. The music and gaming connection Musicians have had the most elaborate brand activations on Roblox. The most recent was the Twenty One Pilots concert on Sept. 17, an interactive performance that had users vote on the order of their five-song set. Epic’s Bell said Roblox is part of “almost every artist conversation” these days. He points to the relationship between music and gaming as the driving force. Gamers tend to listen to music while playing, and musicians have become gaming influencers since many record their Roblox sessions and post them on YouTube, where there is a significant audience for gaming content. Kids are moving from playing with dolls as toys to experiencing the dolls as friends.Jamie Gutfreund, board member, Tubular Labs That was part of the prelaunch strategy for Larsson’s Dance Party, which was tied to the release of an expanded edition of her March album, Poster Girl. Before the party, she played Roblox with a popular gamer; that session was uploaded to YouTube and has been viewed nearly 3 million times. There was a pre-event Q&A session on Roblox, and for the main event Larsson performed several songs against the backdrop of her Swedish lake house. There were also Larsson-inspired mini games, interactive challenges and exclusive verch, including emotes and an avatar bundle that allows users to personalize their avatar with Larsson-inspired verch. The event was featured on Roblox’s menu page, which is akin to Amazon’s homepage, where they could also buy the Larsson-themed verch. And that, says Bell, was one measure of success. “The key component here is monetization,” he said. “I can't give the verch numbers, but they're significant. And that alone says that this was effective.” And then there are the intangibles. “On a macro level, like many platforms today, it’s the combination of awareness, audience development and engagement,” Bell said. The ‘always on strategy’ MGA Entertainment, maker of LOL Surprise dolls, took a different approach to its Roblox presence. Instead of a formal partnership, Gutfreund and her team did it independently, hiring developers to create LOL Official Party, which launched in April. Once Gutfreund learned from SuperAwesome, a company that works to ensure digital safety for kids, that youngsters spent 60% more time on Roblox than watching TV, it was a no-brainer. “Kids are moving from playing with dolls as toys to experiencing the dolls as friends,” she said. “That’s true for all brands. It’s much richer and experiential. It gives it three-dimensionality.” And it drove sales. Research shows parents were more likely to buy a physical LOL product in-store when they observed their child playing with the brand on Roblox. The next iteration is MGA’s partnership with Walmart. Certain LOL toys will soon arrive on Walmart shelves with packaging that contains a code to unlock exclusive content on Roblox. A common phrase heard among marketers about Roblox is the “always-on strategy.” While these elaborate experiences don’t last forever, certain elements of them—like avatar accoutrements—do. And they need to be maintained and refreshed. “Quite honestly, we’re figuring out what our always-on strategy is,” Bell said. “Are we adding new games? How are we engaging? Do we put a new concert up? Roblox did a great job of walking us through the initial best practices. Now, we're working together to develop that always-on strategy.” Creating metaverse experiences is expensive and time consuming. But with 48.2 million users, it just may be necessary. CFO Guthrie addressed it at the conference. “How do we help brands decide if it’s something they want to have up for months and months, or is it an episode?” he told the virtual audience. “Is it something they want to help promote for the launch of something and take it down later?” These are all questions being fleshed out as digital marketers realize they need an entirely new staff of experts to fuel these metaverse experiences. And just as brands now have social media teams running their channels on Instagram and Twitter, they’ll likely also need metaverse experts to translate what works on that platform. “It's got to be made for the medium,” Gutfreund said. “If any brand understands the rules of the universe, they can deliver something that you can't do elsewhere. It's experiential and doesn't feel too transactional.” Guthrie pointed to what might be the next iteration. He said he was recently speaking to an animation studio that works on traditional content, and the finite nature of movies and binge watching came up. “You spend all this time building a brand, and it has a narrow window where it’s enjoyed,” he said. “How do you turn an audience into a community? I think we can help not just media brands but consumer brands. Those are the things we want to explore.” How An Engaged Community Keeps Peloton Pedaling Its Way to Success