Welcome to the Inteline Podcast.
Today, we’re going to be talking about a space I’m both passionate about, and have spent basically my whole life steeped in: video games. It’s also a space that I think doesn’t get talked about in anywhere near the level of detail and pragmatism that it deserves, which is fashion’s crossover opportunity with video games and user-generated content or UGC platforms.
Now, if you haven’t already, before listening to this episode, I’d encourage you to go read the Real-Time Report that we put out at the end of summer with Epic Games, because that goes into a lot of important background about the distinction between the real-time engines and tools behind video games and how they’re being adopted behind the scenes in fashion and the more consumer-facing opportunities that everyone defaults to talking about when they talk about fashion and gaming.
Today, though, I’m going to be focusing more on the outward-facing side of things. And I’m using this discussion as a way to try and get some concrete answers about what fashion and beauty brands are actually trying to do with platforms like Roblox. I’m trying to get some clarity on where the spend and the return for those kinds of initiatives lives. And I’m trying to understand whether these are capabilities that brands should be aiming to build up internally or whether this is something that the industry will continue to work with agencies and third parties on.
To help get those answers, I’m going to be talking to Marcus Holmström, who is the Founder and CEO of The Gang. Along with his team, he’s worked on building branded experiences in Roblox and other platforms for companies like Vans (part of the VF Corporation), Gucci, Givenchy in VR Spaces, and then companies like IKEA and Netflix outside our direct remit.
Marcus very much sees all of this as a growth area, especially in fashion, and he’s keen to talk about why that is and what it looks like, practically speaking, to prepare for the opportunity. From my side, I’m interested in who holds the purse strings, what the technical pipeline looks like, and what the future might look like for the shaky promise of interoperable digital fashion in a market where walled gardens are the norm.
So, for now, over to my chat with Marcus.
NB. The transcript below has been lightly edited.
Okay, Marcus Holmström, welcome to The Interline Podcast.
Thank you very much, great to be here.
Pleasure to have you. Let’s start with a big question. So at the most basic kind of fundamental, essential level, what is the business opportunity for fashion in video games? And how have you seen brand attitudes towards that opportunity change in the last couple of years?
Well, I would say that this space, the UGC space that we’re talking about here, it’s very much the new social platforms. It’s not just entertainment or gaming, it’s actually a lot about self-expression. So I think the fashion companies, they start to see that there is a possibility to reach the audience at an early stage, first of all. And why this is quite important for them is because it’s an identity, just like it is in the real world – it’s kind of what you wear is who you are. And they run around with their avatars and they put their clothes on. And I also think that a lot of brands see this as a future brand recognition. So they see this as the clients or the customers of tomorrow. They want to reach them at an early stage. So I think there’s quite a lot of opportunities for the fashion industry to be honest.
Okay, and have you seen those attitudes change in the last couple of years? Have brands gone from framing this as experimental, for instance, to maybe framing it as something more serious and something they’re more committed to?
100%. In the beginning, I would say it was quite experimental. It was kind of, let’s do this and see what it is. Let’s try to get some PR and let’s do some marketing. And now it’s more of a strategic investment. And they also use it somewhat to look into what’s happening in the digital space when it comes to fashion, because everything is blending together more and more in the world. So more from kind of strategic future positioning.
Yeah. Okay. And how does fashion’s attitude here differ from what you’ve seen from other media, other sectors? You’ve worked with Netflix, for example, you’ve worked with big box retailers like IKEA, you’ve worked with sports franchises like Wimbledon and so on. Where is fashion relative to other industries in its understanding of and maturity in this space?
First of all, they’re very quick. They’re very quick to try new approaches. A lot of the other media or verticals, they are more looking into what’s happening rather than jumping on. And just to mention, one of our absolute first clients, or the really big first one, was Vans, the shoe company, the VF Corporation. They jumped on Roblox when there were more or less no brands at all on the platform. And then we started to do a lot of things. We started to do, for example, that you could create your own shoes, shoe design. So it’s very quick to try new approaches.
And what I also think is interesting here and compared to the other media is that the real-time feedback and the community engagement might be actually more important for the fashion companies if you compare to, for example, a sports brand. Because here, you can actually learn something. So, if you take the Vans example, you can take the data from what the users are creating, what kind of shoes they want to use, what models they want to have, what colours and everything. If you take a sports brand, their main incentive might be to get people interested in tennis, like Wimbledon, and not actually learn so much on how people play tennis.
That makes sense. I think because fashion is a very reactive industry in a lot of ways. And I think most brands’ ambitions is to become more reactive to shorten time to market to develop a better understanding of who they’re selling to and why and how they can influence that sort of behaviour. So I think that tracks.
Yeah, 100% and I think it’s important for them because when the world is changing, they need to be aware of all the trends. And I think it’s super, super smart to jump on these platforms and educate themselves and be part of the communities.
Okay. So you mentioned this and we’re to broaden our scope as we get a little bit further in. But first, why is Roblox still the dominant force here? What is it about that platform that’s continued to capture attention and investment from brands? Is it the tools themselves within the platform? Is it the shape, the scope, the composition of the audience? It feels like you’ve seen other platforms where their fortunes and their cultural relevance has kind of waxed and waned over the years, but Roblox is still the thing that’s always on the tip of everyone’s tongue whenever you bring up fashion and video games or fashion and user generated content. Why is that?
Well, I would probably say this: If you look into the historic part, why Roblox was built from day one, it was built to be an educational platform. It was built to teach young people how to develop, first of all. So more or less, you gave young people the possibility to take charge of their own self-expression. And that kind of makes a lot of sense while it’s so relevant today because it is mainly the players themselves that are building experiences for themselves.
And then on top of that, of course you have the size, why it’s relevant. It’s been growing like crazy of course in the last years. So, right now, we have over 111 million daily active users and that is more than 40% up year on year. You reach most of the young adults and younger people in the world on the platform.
And then thirdly, I would say, it’s also a living ecosystem. It’s not dependent on social trends or a new game drop. So it’s more that there are so many things happening, there’s so many new experience games coming up every single day. So when you are there, you can meet your friends, you can hang around, you don’t have to play. It’s social, but also you can see new things and get new experiences every single hour, more or less.
Okay, those are important metrics. I get why those matter. So just staying on Roblox as a platform then, and just to help the audience understand here, is there a pathway to purchase from Roblox? So engagement, I’m guessing, is obviously a primary metric. But are we measuring actual conversions to the purchase of physical products that you can tie or attribute to an activation in Roblox?
I love this question, I get it quite often.
First of all, Roblox has started to do real world shopping and together with partners such as Shopify for example. I would say that is very early days. Fenty Beauty, for example, did one thing not too long ago where they connected the in-game shopping together with real world shopping. So you actually got the products sent home. But I would say you are going to see that growing over time, more and more.
Then another thing that I think is very, very strong right now is the data, is the loyalty program. So for example, we built a loyalty connector. So in the game, we can connect with the brand’s loyalty program. Then you are not transferring, but you’re increasing the possibility to sell to the players because you get the direct connection with them. So if they sign up to your loyalty program, then they’re part of your main kind of channel for promotions and everything. So I would say that’s kind of the value right now that’s stronger. But then moving forward more direct shopping possibilities are going to come. And I also say, are they measuring? It’s difficult to measure exactly. It’s like any form of other campaign, if you take TV or similar. It’s very difficult to attribute to so many sales who came from this exact product. However, if we create a specific product, and a specific product drop for example, Roblox or Fortnite, then you can of course attribute it and you can see directly, this many people bought this probably due to this.
So we have seen brand signals, we have seen, worked with other brands such as Spotify for example, and we looked into increased awareness and loyalties from different campaigns. But it’s, I would say right now, more somewhere between marketing and for the future direct e-commerce.
That kind of brings me to my next question. So that’s our money inside of this, if you like. That’s our return. Thinking about the spend. And this can be Roblox or beyond. Where does the spend for these kinds of activations live? Where do they sit on a fashion or a beauty brands’ balance sheet? You mentioned marketing becoming increasingly transactional. Is there market testing to inform product development? Is this all blended across different business lines? Who holds the purse strings in the budget for these kinds of projects?
It’s very different depending on the brand, first of all. But I would say mostly it’s on the marketing right now and the brand experience. But then it’s becoming more a part of product development for some of them and the trend testing, if you so say. As it kind of looks into the innovation, digital product and insights. What I talked about, that you reach so many people, so you might get the insights from them and then put that into your own innovation and product creation. But then we have some also, they see this I would say as the part of the UGC platform, as part of the omni-channel approach. So it’s not one-off, but it’s more of a broad kind of connection to everything social, to all of the other things they do.
[Just a quick heads up before my next question for Marcus. He had to relocate offices in the middle of our interview. So we put it on hold and we then picked it up a little bit afterwards. That means Marcus’ voice is going to sound a little bit different for the rest of these questions that take place. But trust me, they were all recorded on the same day.]So I want to try and tie this into something a little bit different because there’s a big expectation at the moment within fashion brands that have built up 3D digital product creation capabilities that required a lot of investment in software and skills, that those things should be additive to the wider business. The value of creating styles in 3D can be measured in design and development, but it shouldn’t just be measured there. But as fashion is finding out, I think the journey to extract that value isn’t straightforward. And I think at least some of the companies now are asking themselves how much they want to continue to grow functions that aren’t always easy to hook into wider business strategy.
This is maybe a tricky question for you as an agency or studio. Do you see the video game opportunity or the UGC opportunity in the same light? You know, is this something that can become directly additive and more straight line into fashion business objectives and business strategies? And if that’s true, if it’s to become a bigger piece of fashion strategies, is it a muscle that brands should justify building for themselves and having internally? Or do you think the future is still tilted towards this kind of agency model?
I will answer your last question first. I think moving forward we are going to see more and more of the fashion houses, the fashion brands that can own more of the capabilities in-house because I truly believe there are a lot of things you can actually use the 3D models and capabilities for moving forward. Of course you can use it for games, which can be good for brand awareness, in-game sales and those kinds of things in order to get revenues from other directions than you have today. But then also I think moving forward you will have other connections as well. You will have, for example, virtual fitting rooms, which has been on the topic for quite some time. I think that’s going to come more and more especially with AI, when you can actually get the better imagery of yourself and then use the 3D models in order to kind of put them so they look as they will on you, on your body. And you don’t have to ship the products. So I think that’s going to be a great use for them. And then also digital fashion shows to reach a wider audience. And that can also be done within the UGC spaces of course, but also outside on their own. So I do believe there are going to be way more companies that are going to see this as a central part of the business rather than it’s just an investment and we don’t know what to do with it.
Okay, I think that makes sense. And I think the more we can get into some of the direct attribution stuff that you talked about in the last couple of answers, I think the clearer the value of that will be. I think another big piece of the puzzle here, as well as growing capabilities internally to create assets and create experiences from those, is that it’s not meaningful to just show up in video games or in UGC platforms or what have you any more than it is to just simply show up or appear on any other channel. If you’re to make a strategy like this a success, it’s about more than just having the capabilities and the assets. It means keeping a finger on the pulse of the specific culture that exists within a specific platform, or it means integrating your branded experiences with other kinsd of mainstay perennial games on Roblox, for instance. And from a brand point of view, that almost feels like a bigger concern than the technical elements or than the talent side of things.
What’s your read there as the lead of a company that’s deeply immersed in those kinds of macro and micro cultures? How big of a feature function capability is it for brands to not just think about generating content and generating experiences, but having people and having functions that really understand the culture of these spaces?
I think this question is quite interesting and I think it’s actually wider than just for fashion brands. I think it’s for every brand that is looking into inserting, injecting themselves into the UGC platforms.
So first of all, you have to look into what the platforms are and why people are there. And I fully agree with you. You can’t just put something up there. It’s a brand and it doesn’t fit because then people are going to reject it, people aren’t going to like it. So you have to look into why people are there and then be part of the platform and not do a brand takeover. And I think that’s the most important part. So you kind of look into what kind of experiences people actually have there and can we reuse one of those or can we mimic one of those in order to put ourselves there?
If we take Vans for example, we did a skateboard game, which is naturally fitting with the brand, but also for the platform, because one of the first actual games on Roblox ever was a skateboard game. So we thought this was quite a perfect fit for them. And now we’ve been working with them for three, four years and we’re doing new additions and extensions to the game and we have had over 100 million visits to that one alone.
But to further talk about this one I also think one untapped source that brands – especially fashion brands – can actually look into is also the creators, the UGC creators on the platforms. You have thousands and thousands of them and some are selling items, avatar items for like millions of them. And these people are instead kind of sitting outside and analyse trends and try to understand the trends. These people are the ones that are living, they’re living the microculture moments every single day. And they create items that are fitting for it. So I think collaboration with them is something that is a huge potential and possibility. And that can be together with your own experience or completely separate.
Let’s talk a bit about the technical pipeline then. So, treat me like a brand that is new to this. Someone who’s never done an activation outside of traditional established digital channels, out of home channels, what have you. If I came to work with you, what should I be thinking about preparing, packaging up, and prioritising on top of handing over the usual kind of brand guidelines and principles? Is it beneficial for me to have 3D representations of my products already? Is it beneficial to hand over pack shots and product descriptions from my kind of PDP e-commerce pages? What does it take to be ready to try and do these kinds of activations?
Yeah, we would always start with the intent, the reason. We would always start to kind of speak with clients to see what is the main focus? Why do you want to be there? And what do you want to show? Rather than start to look into how can we represent your brand in here, because that’s more the bigger picture. Then when we have figured something out, this is the good way to do it. This is what you want to reach. This is kind of the end result that you’re after.
Then we start to look into what you have and you mentioned 3D models. 3D models are really, really good because to a lot of extent we can use them. We usually take them down because your 3D model as a fashion brand is going to be more graphically higher than what we’re going to use in the game. Because I think if you just put them in SDA it will burn the phones of the players. Exactly. But it’s still going to look stunning and it’s also good for of course any reference imagery. It’s always good for our creators, our 3D artists that we have.
And then I think as a brand as well, it’s good to be open to reinterpretation, to kind of think about it as a playful adapted way to come into the platform and think about: okay, skip the boundaries and think about, what can I do here that I cannot do in the real world to kind of go wild and crazy and because it’s for fun. It’s a platform where people are because they want to have fun and it should be joyful. And that’s how they should see your brand as well.
I like that. Treating it as a channel with its own benefits and its own things that you can accomplish on it that you can’t accomplish elsewhere is an interesting way to think about it. And I think that recontextualisation and the willingness to look at your own brand differently through a different stylistic lens, through a different community lens, that seems like an important piece there as well.
Yeah, and you can learn something. You can learn from the community. Like I said before, they can actually teach you how they want to see your brand. And that is quite interesting.
I like that. What other video game properties and platforms are you looking at and thinking about at the moment? If we cast our minds forward into 2026, GTA 6 (Grand Theft Auto 6) is rumoured to be arriving with creator tools or having them added post-launch. And you don’t have to think too hard about the long lifespan and the success of GTA 5, which does huge revenue numbers way into its lifespan, are not made up from boxed sales to predict that there’s a big market opportunity there. But anything in that space is also an opportunity that’s not what you would traditionally define as “brand safe”. I think that’s emblematic of a lot of mature rated games which have captive audiences in key demographics but also maybe represent brand risk. So, technologically and culturally, what’s interesting to you platform-wise and property-wise beyond the current mainstays?
I think it’s a good question first of all because it’s a very, very interesting time and I would say the UGC spaces have been evolving quite tremendously. When we started this company about five and a half years ago it was only Roblox I would say, and then Meta started with the headsets, you had some other ones coming up, you had Minecraft but it was a standalone game, and then Fortnite evolved into a UFN platform and Minecraft probably will do something moving forward as well. That’s gonna be very, very interesting and GTA you mentioned – it’s different audiences so I will probably look into it from what audiences are there on each different platform. Of course you’re gonna have a more mature, older audience on GTA because those are the only ones that are allowed to play it. It might be very old people even compared to if you look into Meta Horizon or Roblox, Minecraft then you’re gonna have slightly younger adults I would say on all of them.
The type of investments on all of these platforms are quite significant at the moment. We’re building on all of them first of all. (Not the GTA of course, because it’s not launched). We are partners with Meta, so we’re building there. We’re partnering with, so we’re building on UFN, Epic Fortnite. We’re having partnerships with Minecraft and also with Cepedo. So I would say on our radar we have all the platforms. Our main focus is still where the traffic is and that might shift. So right now the main focus is Roblox because it’s the biggest. We work a lot with Meta because they are up and coming and there’s a lot of interesting things happening. They are going to release a new engine. And the same with UFN, Fortnite, they are making some new additions and changes. So I would say the platforms are seeing that this is a very interesting space and it’s growing and they want to be part of it.
I think another key consideration when you think about each of those platforms and properties is basically every one of those is an economic. So, you know, people who talk about the size of the market for open-ended portable digital assets, you know, fashion that you own, which was a big selling point behind the whole Web3 digital fashion movement, it kind of ignores the fact that the publishers there don’t really want open interoperability and portability. What platform owners really want is to sell you court shoes in 2K this year or boots in FC26, and then they want to sell you them again in 2027 because there’s no real incentive for interoperability between franchises.
Now I’m very much on the record as not being a Web3 tokenised ownership person but I do sympathise with the argument that if every branded activation or every cosmetic purchase is ring-fenced to a particular platform or IP and competing commercial interests are going to keep it there, then that kind of puts a cap on the market a little bit. And for the brands working on those kinds of activations, that also means that each of these projects, or each of these kinds of platform specific efforts has its own finite reach and its own lifespan. And that feels different to Instagram, for instance, or something else as a kind of glib example of a platform that’s going to be around for a long time.
What do you think about that side of things? What do you think about this idea that each of those platforms you just talked about is its own independent walled garden versus the sort of marketing spend that brands would have in something that was more perpetual and more widely available?
Well, first of all, you’re 100% correct. They are walled gardens and they will be because it’s different companies. It’s the same. I usually compare it to social media. So, if you look into TikTok and Instagram, for example, they are walled gardens in between. Yeah, you can use the same content if you want to upload, but there is no connection between them. Of course they’re not going to be because there are two different companies there.
Also, touching upon Web3, for me Web3 is a technology. It’s not a solution of any kind. And just because you have a technology it’s not going to be that you can add it to different platforms and transfer it between what you said, for example, 2K and FC26. That’s not going to happen either. So it doesn’t solve a problem. This is why I think so many people are looking into Roblox because Roblox is growing and Roblox itself is its own ecosystem. The same thing that Meta Horizon wants to do. Because you have so many games and you can, in an app store. So if you take the Apple App Store versus any other app store in the world then you have the connection there. Either you have to build for each and every one of them so you’re to look into the size of the platform. And also when it comes to this I think if you are building one of them, if you take the art pieces, if you take the digital items that you are building, the clothes and everything, in most cases you can actually reuse a lot of the assets and then transfer into a new platform. So you can’t just put it in one game and then have it in another. But if you already created it once, there is a lot of work already done that you can reuse for the next platform. So I will probably see from that perspective.
And I personally don’t think that there isn’t any reason for games to kind of open up their boundaries because there’s also a lot of liabilities. If you allow its code from one game into another game that might be a liability to the company.
I would agree with that. So I think if you frame it from the perspective of ‘create once, reuse as much as possible’ with the understanding that for specific platforms that have aesthetic standards or certain stylistic ways of representing things, like something would look different in Fortnite to how it would look in Roblox. For example, there’s some interpretation to be done there, but the work isn’t just reinventing the wheel every time and how you determine which of the platforms to go after is really driven by who you’re trying to reach and which is the best fit for your brand.
Exactly. So there are a lot of possibilities to actually reuse, as I said, so do that.
Okay, so final question then. Aside from, you know, going to chat to Marcus and the team at The Gang, if you could give one piece of advice or encourage one key bit of introspection or questioning for a brand that’s currently figuring out, is there a place for me in video games? Is there a place for me in user generated content platforms? What would you say to them?
I would most likely say to look at this as the early days of social media. Did you jump on the platforms? Did you try to do anything there? And what do you do with them right now? If you just fast forward and you can look into the same thing here. These platforms are growing tremendously. And if you want to interact with the audience today, that for sure is going to become your main customers tomorrow, you should probably at least look into the platforms. You don’t have to do something super big, but still educate yourself into the platform. See what’s happening. You can do some small tests on it to see and learn. That’s probably what I would say.
I think seeing this as a learning opportunity is definitely the right way to frame it. Marcus, thank you so much for joining. I’ve enjoyed this conversation.
Thank you very, very much for having me.
That’s the end of my chat with Marcus. Hopefully that’s given you a bit more grounding in the specifics here, but I think clearly there’s going to be a bunch more to dissect in the near future. From a personal point of view, I don’t think it’s ever going to stop being fun for me to talk about video games as part of my job. I wish the 10-year-old me messing around with autoexec files and IRQ allocations to get Wolfenstein 3D running with sound could see how far all of this has come and the very weird ways that this has become part of my day job.
Anyway, next episode we’re going to be changing gears and we’re going to be talking about something very different. So keep an eye out for that. For now though, thanks for listening and I’ll speak to you again soon.
