Trailblazers Spotlight - with Matthew Warneford, CEO of Dubit

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Okay, joining us today on Trailblazers is Matthew Warniford, CEO of Dubbit. Welcome, Matthew.

Matthew Warneford (00:09.601)
Hi, thanks for having me, Dan.

Dan Barry (00:12.086)
So looking forward to this chat, we’ve been like working on putting it together for a while, but really excited that we’re making it happen. So, what it kind of like just rock and roll and get into it. So first, let’s start by first discussing, how did you get into this space?

Matthew Warneford (00:34.786)
Okay, I’ll keep it short. we’ve been operating in the kind of kids, media, games space for the last 20 years. And as part of trying to help our customers keep ahead of the trends, we would talk to literally tens of thousands of people in the US, Europe, all over the world every six months. So before COVID, we started to see that in the US,

something like, forget now, it was a while ago, but let’s say 50 % of American teenagers were playing Roblox every week. There was literally only YouTube higher than Roblox. So we’re looking at that going, this is a really big deal. We need to start talking to some brands about this that we’re working with in mobile gaming, web gaming, elsewhere.

And so of course this is all pre -COVID remember, very important pre -COVID. And we started speaking to the brand saying, look, check this thing out. It’s blowing up. It’s huge. And like every brand I spoke to said to me, Matthew, it looks terrible. The graphics are bad and it’s for kids. And immediately this light bulb goes off because I’m thinking you told me this same thing 10 years ago about YouTube, right? Where you said, Matthew, it looks terrible. The graphics are bad.

It’s for kids. And that’s when we kind of realized, right, look, this is actually a big deal because the big guys don’t get it yet, but the audience is there. This is basically, and I’m sure we’ll talk about this, but this is basically the third wave of user created content. Let’s get in there now. And so that was, that was how we discovered Roblox.

Dan Barry (02:20.31)
No, no, A lot of the things that you’re saying rings bells in my mind too, in terms of conversations I’ve had in the past with new tech and new platforms. So for our listeners who may not be familiar with Dubbit, can you give us an overview of what your key services and differentiators are?

Matthew Warneford (02:42.698)
Yeah, so the most reductionist way to think about what we do is we help brands like Adidas, Unilever, NASCAR, H UA, a variety of brands engage with Gen Z inside of gaming platforms, let’s call it like Fortnite, Roblox, Epetto, et cetera. I think the more nuanced way that I like to think about the approach Dubbit brings to that is…

Let me step back. Gen Z represents something like $450 billion of spending power, which is like $8 ,000 per person. It’s like a huge amount. Something like 90 % of Gen Z play games. And various people have reported that Gen Z are spending more time in Roblox today than TikTok or YouTube.

on top of that. Yeah, yeah, like it’s huge, right? And then there’s been reports showing that something like 80 -84 % of Gen Z say that their real world apparel choices, their fashion choices are influenced by their avatar. And the point I’m drilling down to here, the thread that I’m pulling on is there’s a tremendous amount of dollars that is being influenced by

Dan Barry (03:42.164)
bind actually. Yeah.

Matthew Warneford (04:07.98)
the time spent, the behavior inside of these gaming platforms. And we are very focused on helping brands achieve that ROI or ROO. And that’s really where we invest, right? We spend a lot of time building technology and products to help unlock that. One point I want to make is because I’m conscious that I’m not just speaking like to you here, but maybe there’s people that are not brand side. This sounds super cynical and it’s not.

because a really interesting counterweight to gaming platforms is unlike say TV where I can just interrupt your experience with an ad. That doesn’t work in a gaming platform. The consumer has to opt in to engage with that brand. And so it means that the table stakes, the price of entry is create something people want to engage with. But of course, that’s the baseline for the brand to continue. have to then

have measurable outcomes and that’s really our focus.

Dan Barry (05:09.834)
Gotcha, gotcha. whenever you get into any new tech, new tech, especially I think in MarTech, there’s always a whole bunch of different acronyms used and they can all drive, especially like you were just talking about the people who may not be really, really immersed in the space. Like, what does that all mean? why is, let’s say,

Matthew Warneford (05:23.435)
Yeah.

Dan Barry (05:38.538)
UGC 3D. Why is it not UGC gaming?

Matthew Warneford (05:45.888)
Yeah, yeah, and look, it’s the expansiveness of the vision of the platform. one could say, look, Roblox today is, and Fortnite more so, is predominantly user -created games. But I think that’s too narrow of a definition. So very much in the same way that we wouldn’t say YouTube is user -created funny animal videos, right? That’s one type of video.

Dan Barry (06:11.736)
Hmm.

Matthew Warneford (06:14.178)
content that can be on YouTube. What we’ve seen over the last 10 years is there’s been a whole variety of video formats, content that’s been created that really didn’t exist pre -YouTube. And that’s what I think we’re seeing on platforms like Roblox. So at the simplest level, it’s user created 3D because anybody can build 3D content, whether that’s games, could be fashion shows, could be clothes. It could just be…

Dan Barry (06:40.128)
Mm.

Matthew Warneford (06:41.76)
But there’s experiences that I would call interactive stories and there’ll be a whole new variety of experiences created. So we shouldn’t constrain ourselves to thinking of gaming equals 3D because a game is something that might have a winner and a loser. And that’s not the case in a lot of these experiences.

Dan Barry (06:59.082)
Right, right.

Dan Barry (07:02.912)
Yeah, I mean, there’s a the yoga experience that’s meditating, right? So definitely not a game. So I had read somewhere where Dubbit has built the most sophisticated immersive commerce platform. And you’re the one to speak to on this. So but so I’d like you to answer that. But before we even get into that, can you define immersive commerce?

Matthew Warneford (07:21.024)
Yeah.

Matthew Warneford (07:33.09)
Yeah, that’s very flattering first of all, wherever you’ve read that. So look, immersive commerce, the very obvious progression we’re going through here is we’re all familiar with e -commerce and then of course on the back of e -commerce mobile devices came out, cell phones and we had mobile commerce and now we know that we’re in a world of social commerce where we’re seeing a lot of noise around TikTok shop and various partnerships with YouTube and others.

where people are shopping inside of the places that they spend time in. And I think the very next obvious evolution of that, particularly if you buy into my worldview of Roblox and others being this third wave of user created content, we’ll see increasing amounts of money spent inside of immersive worlds. And so for want of a better phrase, to me it’s immersive commerce. So it’s simply the progression, e -commerce, mobile commerce.

social commerce, immersive commerce and our spend flows or follows I should say where we spend time.

Dan Barry (08:41.14)
Yep. Okay. Okay. So then the follow up on that is Dubbett’s position as it relates to immersive commerce.

Matthew Warneford (08:50.69)
So I suppose there’s two ways to split immersive commerce today. We have virtual items that are already being purchased inside of games. like Roblox, for example, sold in the region of 2 billion items last year. There was somewhere in the region of 60 plus million items actually created into their marketplace. And the point I really want to emphasize here is

This is a huge amount of commerce happening already, but that’s virtual commerce. There are then, I believe, and depending on how old you are, you may remember back in the early days of the internet, we had things like BRML where people were trying to create in browser 3D stores and everyone said, it’s a terrible idea, right? It’ll never take off. And we all believed that for a while, but I think the reality is what we’re starting to see now is

Dan Barry (09:41.302)
Thank

Matthew Warneford (09:46.9)
As people become comfortable spending real money, but it could be on virtual items inside of immersive worlds, they’ll start to spend a bit more and they’ll spend maybe on real world items. And think it’s a very natural progression. And so what we’re starting to see is the second kind of evolution of immersive commerce, which is buying physical items. And there’s some fantastic experiments in roadblocks with Sawhorse and Walmart creating some really great stuff there.

So what we have been building towards is this vision of the future where I think there will be millions and millions of people, probably a billion people inside of these immersive worlds by the end of the decade. And there will be millions of people shopping inside of those platforms. But it’s a very different commerce experience to the existing, let’s call it mobile and e -commerce products. So what we’ve built is first of all, how do you create the items?

And what do you create? So we look at what millions and millions of people wear, identify trends, we use AI to then start creating those items at low cost, and then we sell those items. How do you get them to the customers? Well, we do that through what we call smart, immersive stores inside of popular games. And of course, whenever you sell, you start to collect data on and you learn what your customers like, and that feeds back into that loop. And that’s the beginning.

right, of these virtual items being sold inside of immersive worlds. And the key really is the data, because there is just, when there are billions of purchases happening, and there are millions of items in the store, you can either create based on gut feel, or we can have used the analogy for Moneyball, the film Moneyball, but for digital fashion. Use data, be smarter.

Dan Barry (11:38.792)
Hmm. Yeah, yeah, yeah. A really good movie, by the way.

Matthew Warneford (11:43.434)
Yeah, yeah, of course it is. Yeah, it’s brilliant.

Dan Barry (11:47.11)
And like you said, it’s all about data, you know, from that standpoint. And interesting that you’re bringing up, like you brought up the Walmart example, but I think the most recent one is like Beetlejuice is now selling movie tickets, you know, through Roblox as well. you know, the whole immersive commerce, know, Roblox, Fortnite, et cetera, I is just going to continue to expand and expand and so much fun in that.

So could you take our listeners and viewers on somewhat of a verbal tour of your immersive platform and at the same time explain why it’s important for brands and what is the user experience for it, for the players and users?

Matthew Warneford (12:39.49)
So let me start with why it’s useful to brands first and then I’ll unpack how you unlock that value. So I think it’s pretty obvious as real world items can be purchased in there, that’s pretty obvious why someone cares about that. Now I can sell a pair of hundred dollar sneakers inside of my game. Great. That’s pretty obvious. We get that.

Dan Barry (12:59.211)
Mm.

Matthew Warneford (13:04.45)
Maybe what’s less clear is why do I want to sell a $1 pair of sneakers inside of a immersive platform? And there’s kind of two answers to that. And I think sometimes depending on your goals, you can weight those benefits. So one answer is obviously I make a little bit of money from that $1 sneaker sale. But I think the bigger answer is when somebody starts buying into your ecosystem and spending money, real money,

inside of your ecosystem, they are far more likely to continue both feeling a very positive about your brand and your ecosystem, but move deeper into that. It’s very much a funnel. It’s a fan funnel into your brand. And the of the terrible analogy that I like to use is perfumes at airports. It’s particularly bad in Europe and Asia here, but we…

Dan Barry (13:53.088)
Mm.

Matthew Warneford (13:59.65)
We’d like to funnel everybody through the perfume section. And of course, we do this because in part, you’re on holiday, you’re in a good mood. You kind of, know, I’ll try something new, right? And you go, that’s $100 to buy into Calvin Klein. Great. Right. It’s a first step to trying something new and buying into a new brand. So to some degree, I think brands should be thinking about immersive commerce in the short term as just a little bit of revenue from the virtual sale.

Dan Barry (14:03.35)
Hahaha.

Matthew Warneford (14:28.428)
But actually, what an incredible way to acquire your next million Gen Z customers that you can start to move further down that funnel to higher ticket price items. And that’s kind of the mindset that I talk about at the beginning with this drive for ROI. How are we moving those players down, not just exposing them to a brand? So then you go, how do you do this? How do you identify this? And so it all becomes very data -driven, and it can get a little bit geeky. But the idea is, again, we look at

across our network of shops, have shops in games that played tens of hundreds of millions of times a month. We see what people wear. So like imagine people going down the high street and we’re to analyze what are they wearing? What do they look at? What do they try on? What do they end up buying? Huge amounts of signals. From that you see trends. Those trends should then be used to inform what you create. So we do that by piping that into an AI production pipeline. Why AI?

because we want to lower the cost of creation. Why do we want to lower the cost of creation? Because, ostensibly, each item you create will not make hundreds of thousands of dollars like an NFT. You people are spending a dollar. So you’re aiming to get hundreds of dollars, maybe thousands of dollars from an item. So lowering that production cost is critical. Secondly, and this shouldn’t be like under underweighted,

Dan Barry (15:47.807)
Hmm.

Matthew Warneford (15:56.778)
Yes, AI lowers the production cost, but AI is incredibly creative. Like look at some of the benchmark scores for creativity. AI does incredibly well. So much so that it’s easier for the AI to generate hundreds of ideas for clothes from that data trends that we input to it than it is for a human, right? It just comes up with more. So we create those, the brand reviews it, approves it. then…

publish those into those immersive stores and just think of these literally as 3D, like 3D branded spaces, like what would be the most amazing vision for a branded store? That’s what it is. And players can go in, they shop, they browse. When they buy something, incentivize them with reward points to encourage coming back, collect points, get more free items. And so a lot of the…

Dan Barry (16:34.315)
Hmm.

Matthew Warneford (16:52.674)
Front end user experience is just that store. It’s those reward points and the product. But behind all of that, like a tip of the iceberg, is all of that data lake, AI production, analyzing what sells, understanding why, codifying those rules. That’s been the big bit of what we’ve been building towards.

Dan Barry (17:14.878)
Interesting, interesting. Yeah. As you’re, as you’re explaining this, it, you know, kind of like early on when you were, you were talking, introducing the whole idea of like immersive commerce, but, I had been involved, with a performance digital marketing company and we were, we were bringing on retailers into e -commerce, right? And

And so much of what you’re talking about, it’s like e -commerce for many retailers that hadn’t really gotten into it. It was like all brand new, but they had to learn. It’s kind of everything that you’re talking about for immersive commerce happened from retail and look at it now, right?

Matthew Warneford (17:52.866)
course.

Matthew Warneford (17:58.548)
Yeah, that’s a say it’s a great analogy because think about how, I choose my words carefully, how intelligent e -commerce websites are with respect to personalizing for you versus me and how simplistic that experience is in the real world. Because we can’t reorganize a store when you go in and then I go in. In 3D spaces, we can.

And so we can make that shopping experience far more personalized. And the last bit that I want to add around that, I actually think is important.

to some degree. there’s no question that e -commerce has made shopping far easier, but I think it’s also reduced the role of brand to some degree. Because when you walk into a Ralph Lauren store, you know it’s a Ralph Lauren store. They’ve done a great job of making it feel a certain way. Prada feels different, Abercrombie, et cetera, blah, blah, blah. E -commerce sites have sort of centralized around a more common

Dan Barry (18:58.228)
and

Matthew Warneford (19:06.254)
UX for obvious good reasons right ease of browsing When we go into 3d immersive worlds again, we can bring back more of that brand. I think that really matters in a world of infinite content

Dan Barry (19:07.264)
Hmm.

Dan Barry (19:21.935)
That’s good. I hadn’t thought about that aspect, but very good. I may have to borrow that someday too. So you had mentioned this a little bit earlier and had kind of like hinted that we’re going to get back to it. So could you define what is the third wave of UGC?

Matthew Warneford (19:27.468)
Yeah.

Matthew Warneford (19:44.002)
Yes, I’m forever banging on about this. So look, here’s how I view it. The very first wave of user created content was user created text. And it was enabled by platforms like WordPress and blogger and Twitter and later Facebook and so on that broadly made it possible for anybody in the world to be able to publish their opinion, to publish content.

for free, right? And of course, that is hugely disruptive because prior to that, the only people that could afford to reach national or international audiences were those ginormously wealthy newspapers and publishers and so on. So it was a massive gatekeeper. Get rid of that. Look what’s happened to publishing, right? It’s completely collapsed. We all know the story. Technology advances. We get faster internet.

broadband, all of these things and we start to see user created video. Now, if you look at the growth, think this is very interesting, look at the growth of YouTube, it grew relatively steadily for the first few years and then the iPhone 4 and 4S came out. They were the first phones that really had great HD cameras and of course at that point

Now anybody can create and publish video content and YouTube just grows, it grows like this and why is that? It’s because all of these waves have the same flywheel. More creators, more content, more content attracts consumers, consumers generate revenue, whether that’s spending or advertising, revenue attracts creators. And so the key, in my opinion, is YouTube benefited from a technology wave

Outside of its control which was the smartphone the cell phone massive accelerant We’re now 10 years on from then and we’ve gone from user created text to video To now we’re kind of at the stage where almost anybody can create 3d Experiences in platforms like roblox and fortnight and zepetto and so on but to draw on that kind of YouTube An iphone moment analogy

Matthew Warneford (22:11.234)
I believe that generative AI is that same external force that will become a rapid accelerant to that creator flywheel for user created 3D. Because we’re really on the cusp of being able to just type in anything and create a 3D model, a 3D object. We’re already in the world where coding is 10 times easier, at least basic coding with generative AI.

Dan Barry (22:36.533)
Hmm.

Matthew Warneford (22:39.042)
And so I think we’re at that kind of YouTube iPhone 4 stage where we’re going to see an explosion of user creative 3D experiences, many of which we would have never imagined in the same way we wouldn’t with YouTube content today. And that’s going to be hugely disruptive.

Dan Barry (22:57.93)
No, no, no. Again, a really, really, really good analogy and it’s fun to kind of watch it. It’s kind of in that, it, yeah, yeah, yeah, yeah, yeah. It’s fun to watch it. So now that we know what it is, what does the third wave of UGC and the immersive opportunity, what does it represent? What does it mean for brands? Can you paint us a picture?

Matthew Warneford (23:07.198)
inflection zone. Yeah.

Matthew Warneford (23:26.402)
So if we were to look at how first of all the first wave of UGC disrupt text, disrupted print, second wave we’re all familiar with the impact on traditional broadcast TV and blah blah blah how the viewing figures have declined. And you will, why does that happen? Well of course the obvious reason is there’s 24 hours in a day. When something new comes along it has to take those hours from somewhere.

Dan Barry (23:54.186)
Mm.

Matthew Warneford (23:54.292)
and so invariably it takes it from the incumbents and so in the case of YouTube you’re watching video and not watching video somewhere else so what happens in the case of UGC 3D what are you doing now that you won’t be doing in the future because you’re spending more time in those user created worlds so the really obvious one here is gaming

And of course we’ve talked about, I’m trying to avoid calling it UGC gaming because I think it expands more broadly. But I do think it’s worth touching on gaming because if you look at the world we’re in today, there are three billion plus gamers. The average age of a gamer is something like 35. Sometimes we think of the gamer as being this console gamer caricature and that’s not the case. Billions of people play games. That time comes from somewhere else.

So it will come at the expense of if I’m in Roblox, maybe I’m not on YouTube, I’m not on TikTok, I’m not playing other types of games. One obvious area. I think you can’t ignore fashion. So if people are spending, let’s say, several hours a day, many hours a week inside of these platforms, and they’re already buying billions of dollars of virtual items.

Dan Barry (25:02.772)
Hmm.

Matthew Warneford (25:15.616)
that’s money that they’re spending on themselves, on their identity, that’s perhaps not going to real world, let’s call it fashion, real world apparel, whatever it might be. But I think it expands a bit further than that, by the way, because I think the choices that we make inside of these immersive platforms, they’re things that we start to purchase today, will inform what we purchase in the future. And so the…

terrible analogy here is I’ve met very few Americans that like cricket and it’s because unless you grow up watching cricket like you’re not gonna just suddenly start going you know what I want to do say I want to watch a sport that takes five days to finish but no one no one ever said that right but British people do it because we grew up with it and my point is the things that we grow up doing early on they stick with us everybody knows that so I think

Dan Barry (26:02.888)
You

Matthew Warneford (26:13.578)
not only is there a disruption to how much people spend on real world fashion because they displace some of that into the virtual world, it informs the choices we make later as we start to buy real world apparel. But more broadly than that, I think there’s big, potentially far bigger disruptive force here, which is I try and think of what’s happening in these platforms as them being

let’s call it presence platforms. So it’s where any kind of experience that is more fun with other people risks being disrupted. So that’s playing games, hanging out, going shopping. All of the things that we remember doing as young people can be sort of done well enough inside of these platforms. And it’s the classic, know, Professor Clayton Christensen disruption theory.

What starts off looking a bit crap today and serves a small segment of the market, technology improves and it serves more and more people. And so I have a view of the world, which is we could see a huge amount of live events and other real world activities get displaced by this and people will go, yeah, but Matthew, the Roblox concerts, they look terrible. And, you know, it’s just people jumping up and down. But my point is that’s the beginning.

That’s where it starts. What you’re seeing is that for a certain million number of people, that’s good enough versus their inability to get to the real world events for whatever reason. It’s good enough. And that’s where YouTube started. It was good enough and it kept getting better and better. So that’s kind of how I see this playing out is disruptive to a way broader than just the gaming world.

Dan Barry (28:08.628)
Yep, yep, yep. Totally agree. Totally agree on that. Yeah. And maybe if cricket adds a penalty shootout at the end, maybe Americans will love that.

Matthew Warneford (28:15.554)
Yeah, well we do have a shorter version now, 2020 cricket, which is more accessible than a five day test match.

Dan Barry (28:26.132)
So kind of like rugby sevens, right? Something like that. So getting back to what you were just talking about in regards to the third wave of UGC, who would you say are the potential winners and losers of this third wave of the UGC third wave and then why?

Matthew Warneford (28:28.576)
Yeah.

Matthew Warneford (28:46.21)
So I think the winners here are very much like YouTube, first of all, the creators. I think there’s a huge opportunity for creators. I wish I was 18 again, because this is where I would be spending my time hacking and programming and building. It’s just great fun. And the reality is we’re going towards a world where some of our smartest people are able to work for themselves.

Dan Barry (29:02.23)
100%. Yep.

Matthew Warneford (29:12.67)
either as YouTube creators, content creators, Roblox creators, whatever. So that to me is thrilling. I think it’s a great thing. The risks again are for the either, and I firmly believe the game studios are going to lose a lot of attention to these platforms like the broadcasters did to YouTube. I think we’re going to see disruption to fashion brands unless they embrace. I think we’re going to see potentially

disruption to TV and other formats because again, there’s 24 hours in a day. So where do you spend your time? You’re spending time doing fewer other things. So to me, think of this primarily as there is no free time left. So this takes time from wherever else has time today and that’s who loses.

Dan Barry (30:06.422)
No, no, well said. And again, I’ve seen that happen so many times. I mean, if you go way, way, way back, the yellow pages were, were dominant, right? It’s like, I think most local businesses spent 50 to 75 % of their total budget in the yellow pages. And then, then you fast forward, you know, a couple of decades later, then it was like all Googles, you know, Google ads, et cetera. So yeah, it’s constantly changing. So, so.

Getting into your role and Dubbit, what are you guys doing to help brands navigate these new opportunities? And do you have a couple of examples that you could share?

Matthew Warneford (30:50.39)
Yes, so it’s probably come through. very excited about Immersive Commerce. And so I’m going to start by talking about some of the stuff we’ve been doing with Adidas where, you know, the fantastic team there, Thomas and his team, have really embraced the idea that there’s a world where they can begin to reach millions of Gen Z by retailing in Roblox.

And so we build a lot of games by the way for brands, entertainment brands, for various people. But what I loved about what Adidas said is that, they know that they’re… People understand them as an apparel brand, a sports apparel brand. So how do we translate that into Roblox? Now my view is people love wearing, shopping, buying their virtual apparel. We can see that in the data. So let’s just make the most amazing stuff.

And so we’ve already made something that well, I probably can’t say how many, let’s say thousands of virtual items for Adidas. It’s going very well. have stores in, again, I won’t say the exact numbers, but those stores are visited tens of millions of times a month. It’s really, really exciting. And back to that earlier point, it’s not just about, yes, we make revenue from this and it’s interesting revenue, but we’re also bringing millions of young people.

into that brand ecosystem. And that’s very valuable as well. Lastly, I’m also super proud of the work the team, the Adidas team did selling the single most expensive of branded virtual item ever. It was worth what, like the equivalent of $20 ,000, right? It’s just a hugely amazing and exciting achievement on the platform. So there’s things like that that we’re doing that I just think are fantastic. Then we’ve also got lots of other, what I would call,

Dan Barry (32:35.466)
Yeah, very cool.

Matthew Warneford (32:47.315)
Let’s call them brand awareness exercises. So rather than trying to get people to wear your merchandise, super big fans of your brand, because by the way, it’s quite a commitment for a million people to buy Adidas product. That’s a big deal. It’s a million people that buying your virtual merchandise. You’ve then got the other stuff that we’re doing around integrating brands into our network of popular games. So we have hundreds of games that we work with.

Those games are played again hundreds of millions of times a month. Very exciting when you can integrate brands in a meaningful way across multiple games in those networks. Love those kinds of campaigns because you get great results. But more importantly, and this is kind of a little bit of a nod to where I came from, I love them in part because when I was young and started this company, I was literally 18 and I was trying to…

I had this idea, let’s make virtual worlds. It was a crazy idea back then, but let’s make a virtual world for teenagers. And we had no idea what we were doing. I could program, but like, how do you make money? How do you speak to brands? How do you not get ripped off? And so we were just figuring all of this out as just like teenagers with no idea how to do it. And we did figure it out and we did some interesting stuff, but it was really hard and we got taken advantage of a lot.

Dan Barry (33:49.91)
Thank

Dan Barry (33:54.901)
Mm.

Matthew Warneford (34:08.834)
I love the fact that when I get to work with brands and creators today, we can make that far more equitable and fair and treat them the way that I wish I had been treated as a creator, you know, 20 years ago. So to me, that’s just super exciting as well. think this is, this is just, you know, squaring the circle on where I came from, which was being a teenage developer to now working with teenage developers and bringing them amazing brands.

Dan Barry (34:22.442)
Yep.

Dan Barry (34:35.574)
Now, you’ve got so much history in this space, that’s incredible. And, you know, as you’re describing, just like some of the numbers, it must be a situation too, where you’re getting a lot of data as you’re working with more and more brands, you’re getting more experience. You know, you can now really, really inform your 18 year old self. This is the way you should really do it, Matt.

Matthew Warneford (34:56.439)
Mm.

Dan Barry (35:05.91)
I’m just thinking like as brands are now coming to you, you now have all this data, this experience. How are you, how are you really showing this to brands as they let’s say a brand new brand who’s just kind of getting into the space and, and, and, and chatting to you about what, what are they going to do and how are they going to do it?

Matthew Warneford (35:25.058)
So it’s funny you mention, right? when we first started coming into Roblox, and of course, this is the inevitable kind of

misplaced overconfidence that you have sometimes as feeling like you’re a professional. I know what I’m doing, right? I’m going to do this better than the teenage creators on the platform. And of course, some of the first things we built, mostly for ourselves, it was quite a humbling experience. Like the games that we created, no one played. And we thought that this used to work on mobile. What don’t we get about the platform?

Dan Barry (36:03.52)
haha

Matthew Warneford (36:05.866)
And it’s been a journey of realizing, you know, there are the best way I can describe it, right? When I was a kid, if mum bought me a new computer game, it was like the one game I was getting for the next eight plus weeks. So it did not matter if that game was hard to play. You just sat there and you figured it out. Kind of fast forward and we get to the world of app stores.

makes it way easier to try stuff but you’ve still got a, you know, kind of there’s friction, press install, wait for it to appear if you’re young you need mum’s permission, blah blah blah Roblox? None of that friction None at all, you just try it out and you’ve got like 30 seconds to figure this thing out and of course it’s so obvious in hindsight that that changes how you design games

Dan Barry (36:46.432)
Mm.

Matthew Warneford (37:03.798)
But coming into the platform, I’m thinking, these guys, the game loops are so simple. They don’t get it. We’ll build these professional things. And it didn’t work. And I think that’s the same mentality of people aren’t watching, generally speaking, people are not watching long form content on YouTube. They’re watching shorter form content. It creates different types of content and the format does. So to your point about data and exposing this to brands.

super open. We completely misunderstood the platform. We thought it was just a gaming platform with a bunch of bad games. And it’s not. are different dynamics. It’s a social platform, a presence platform. You’ve got a short window to engage. And so of course we show brands a lot of the data that we see around this and help them to avoid the mistakes that we made early on.

Dan Barry (37:39.06)
Hmm.

Matthew Warneford (38:02.496)
because it’s very easy to think I’m the professional here, you know, I’m the brand. But we’re going into somebody else’s world.

Dan Barry (38:07.146)
Right, right.

Dan Barry (38:12.374)
No, no, totally, You had touched on this a little bit earlier, but Roblox had done a study and they found that 56 % of Gen Z said that styling their avatar was more important to them than how they dress themselves in the physical world. And you had kind of talked about fashion as well, but why do you feel, why do you think that young people

care so much about how their avatar looks. And then the follow up to that then will be how can brands leverage on this statistic.

Matthew Warneford (38:52.14)
So, first of all, I think there’s a couple of layers to this one. People, at its most simplistic, most reductionist, people care about how other people perceive them. Not everybody, but by and large. And that’s fine, that’s perfectly normal. And we all do to some degree. So where we spend time with other people,

we care more about our appearance. And by the way, you can get into conversations about identity and other things. And the reality is we can have different identities in different places. Your personality, your identity with your college friends can be different with your tennis club friends, your work friends, whatever. But at its most basic, we care about what other people, how other people perceive us in the world. And so of course, clothing and how we dress is one of the ways that we can express that.

Another way when we were all growing up was things like music, right? What band, like stickers or t -shirts did you wear? There were different ways. So this is nothing new. The other thing to think about here that I think is very important as you peel back, what does this mean to use clothing as a way of expressing ourselves and how others perceive us is again, think about any of the clothes that we buy in the real world.

Dan Barry (39:52.982)
Hmm.

Matthew Warneford (40:17.858)
there is some degree of utility and some degree of let’s call it identity or expression. And of course, typically the more expensive that item gets, the utility component relatively gets smaller to the identity component with respect to the dollar values. So if you’re buying a $20 ,000 handbag, it’s not because it can somehow magically store more stuff, right? It doesn’t have a black hole and it stores more.

Dan Barry (40:47.764)
Yeah.

Matthew Warneford (40:47.902)
It’s all about what it says about you. And so my point being is people have always cared about the identity piece. What you see in these platforms is the identity piece becomes a hundred percent of the value versus utility because there are types of clothes that have utility. Waterproofs, blah, blah, blah, whatever. So to me, all very common. The other last piece I would hit on here is look at what happened with NFTs. Early days before NFTs became a

Dan Barry (41:02.335)
Hmm.

Matthew Warneford (41:18.292)
speculative instruments, they were kind of the equivalent of the Rolex, which was, I’ve got this thing that’s worth X tens of thousands of dollars as my profile picture. Why? Because I care about what my online community thinks about me. Exactly the same in these platforms. So to me, this is nothing new. And it’s the classic, by the way, that there are very few new behaviors. There’s just new ways of expressing them.

Dan Barry (41:31.06)
Hmm.

Dan Barry (41:47.124)
Hmm, yes.

Matthew Warneford (41:47.786)
And you see this throughout time. Human behavior is consistent, but how we accomplish our goals for community, self -expression, love, belonging, all of these things, that changes through technology. And so this to me is super normal, right? Then you get to the point of, where does it tie into brands? And to me, it sort of triggers back to some of the stuff we were touching on before, which is, people…

What people buy now informs what they buy later, it informs their identity, their self -conception of themselves. There’s a lot of studies being done, a great book, Seven Laws of Persuasion, that talk about this idea of if you make a small commitment first, you are far more likely to agree to a bigger commitment later. So the way, again, the airport perfume analogy, somebody who spends $100 on Calvin Klein at the airport on a whim,

It’s actually far more likely to continue to then go, you know what, I’ll spend and buy some jeans and some sneakers and whatever, whatever, because that’s part of my identity now. So to me, a lot of what’s happening here is, A, the early stages of people starting to spend meaningful amounts of money on their digital identity in a non -speculative trading way, a much healthier way for the ecosystem.

how much they spend will grow. guarantee it’s going to grow. But secondly, it’s informing their real world identity. They’ve said it does, to your point, the stats. But also we know from prior history, the small commitments lead to bigger commitments. so brands should think about that funnel of, you know, the million people that buy from Adidas today, whatever that number is, not confirming the exact amount.

Dan Barry (43:21.248)
Hmm.

Matthew Warneford (43:39.286)
but all those people that are buying from adidas they’re a step further forward to being future fans of the real world products and blah blah blah and that matters to me and that’s a really valuable thing probably more by the way than just playing a game you know buying something is a sign of commitment playing a game is a sign of entertainment which of those has the biggest brand uplift

Dan Barry (44:00.234)
Yep, yep, yep.

No, and since you’re targeting a young audience, you know, whether it’s, you know, know, Jen alpha or Jen Z, if you can get somebody to start buying your, your product, your clothing or whatever Adidas, etc. Like, like, I’m an Adidas person, I’ve been buying it for decades, right? And there are people who are not Nike, right? They’re, they’re always just buying Nike. So if you can

Matthew Warneford (44:22.26)
Yeah.

Dan Barry (44:30.618)
somehow persuade or get a customer early on, you know, while they’re young, you know, you have a lifetime of, of commitment, hopefully, you know, for that brand as well. Yeah.

Matthew Warneford (44:42.282)
And I think, again, I’m very sensitive to this idea of what we’re not trying to do is trick anybody into making purchases. the only reason anybody would buy any of the stuff we make for any of the brands we work with is because they think it’s cool. And so the way that we figure out what’s cool is we use data, but there’s no trickery behind it. There’s nothing else. It’s just the reality is people buy into what they think is cool. And if

Adidas or any of these other brands that are on the platform and making cool stuff today The reason people continue to buy from them is not because of psychological trickery. It’s well, they’re cool They represent me. I want to be perceived in a certain way This is a useful way of me continuing to be perceived that way and that’s all fine There’s nothing bad about that. Now. I’m sensitive to this because you have to be very careful to your work with young people

and we don’t go out of our way to target under 13s and blah blah blah. But I think it’s just the reality of the world that we care about how we look and that’s okay. There’s no price gouging here.

Dan Barry (45:43.232)
Yep, yep.

Dan Barry (45:53.46)
Yep, yep, Exactly. So this has been like really, really good. It’s like, my God, we’re almost, we’re almost getting up to an hour or so. So my, my, the last question that I always ask, and it’s actually one of my favorites, like any new projects that you and Dubit are working on that you’re able to discuss.

Matthew Warneford (46:14.242)
Not that I’m able to discuss. I’m sure you get that answer all the time. Let’s think, what would I say I’m most excited about that I can discuss? It’s not already been announced.

Dan Barry (46:30.496)
haha

Matthew Warneford (46:32.662)
When’s this coming out? How many weeks?

Dan Barry (46:34.974)
like say to around two weeks. Yeah.

Matthew Warneford (46:41.602)
I’m trying to think. I don’t want to get in trouble. We work with a lot of very big brands that could just stamp on my head and I don’t want to say anything out of turn. What I would say that I’m generally excited about, right, generally, and it’s very obvious, we’re doing a lot of cool stuff around immersive commerce. We’re working with some amazing brands. There’s some amazing stuff that our partners are doing and launching very soon that I would love to shout about.

Dan Barry (46:41.664)
We can delay it for a week.

Dan Barry (46:51.764)
No, no, No, no, no, that’s.

Matthew Warneford (47:10.304)
very proud of what the Adidas team have done. think Thomas and his team there have been very visionary in embracing the way that you operate on these platforms. The work they did creating the highest selling item ever is phenomenal. We have a bunch more stuff like that that I desperately want to talk about. I don’t remember exact release dates and things.

Dan Barry (47:34.378)
Well, we’ll be keeping an eye and definitely we’ll be promoting anything that we see that’s exciting that you guys are doing. So if anybody’s listening, watching, and they are interested to chat with you or your team in regards to potentially doing some work, how can they reach you?

Matthew Warneford (47:53.378)
Email is great, Matthew with two T’s at dubbit .io. Just drop me an email or go on the website dubbit .io.

Dan Barry (48:06.112)
All right, cool. Again, thank you so much, Matt, and we’ll be keeping an eye on the new stuff that’s going to be coming out soon. So you take care.

Matthew Warneford (48:08.725)
No, thank you.

Matthew Warneford (48:15.924)
Yeah, we’ll be in touch.