Dive Brief:

• Walmart has shut down a branded space in Roblox called Universe of Play after six months, according to a blog post from Truth in Advertising.org (TINA.org), a nonprofit consumer advocacy group. 
• The move follows a push by TINA.org and other watchdogs to assess Universe of Play for potential “manipulative stealth marketing” to kids. Universe of Play and a similar Walmart Land experience launched in September as part of the big-box store’s efforts to reach Gen Z consumers through the metaverse. 
• Walmart said the quiet discontinuation of Universe of Play was “as planned.” Concerns surrounding children’s privacy in the metaverse are on the rise, and Roblox recently adjusted its ad policies regarding messages targeted at kids. 

Dive Insight:

Marketers’ excitement over the metaverse has been, in large part, a demographic-driven story. Gen Z and Gen Alpha have flocked to multiplayer online games including Fortnite, Minecraft and Roblox for entertainment while spending less time with traditional ad-supported media. The metaverse has been positioned as a bridge to reach these elusive young groups where they’re already spending their time. Many branded metaverse activations have manifested as custom worlds like Walmart’s Universe of Play or Nike’s Nikeland, also on Roblox. 

Metaverse marketing’s focus on engaging teens has resulted in calls for closer privacy scrutiny that could throw some cold water on the hype. Roblox last week revised its policies to explicitly prohibit ads targeted at users under 13, or those in the Gen Alpha range. The updates offer additional guidelines around advertising and sponsorship disclosures and forbid brands from sending users off of the Roblox site through means like QR codes and URLs. For retailers interested in creating an omnichannel activation, where metaverse playtime can tie into e-commerce facilitated through their owned sales channels, that creates a problem.

Walmart claims that Universe of Play’s closure was a planned part of its strategy. The experience was promoted as “the ultimate virtual toy destination” and included products tied to popular franchises like “Paw Patrol” and “Jurassic World.” 

“We’re always looking to create engaging experiences for our customers. The intent of our presence on Roblox is to continuously innovate,” Walmart said in a statement shared over email. “Taking down some experiences to work on new [ones] is part of that innovation. Universe of Play has been sunset as planned and we look forward to launching new content for customers soon.”

Walmart pointed to other steps it has taken to safeguard privacy. The big-box store late last year joined the Children’s Advertising Review Unit’s COPPA Safe Harbor Program. COPPA is the Children’s Online Privacy Protection Act, and the program is approved by the FTC as a method for ensuring compliance. 

TINA.org took issue with the move, arguing that the Children’s Advertising Review Unit (CARU), a self-regulatory group, overstepped its bounds since the program does not provide safe harbor for advertising, only privacy. In January, TINA.org and similarly minded watchdogs sent a letter to CARU encouraging them to audit Walmart’s Roblox efforts. CARU ultimately defended its decision to admit Walmart, stating that Universe of Play is properly disclosed as an advertising initiative through the use of the retailer’s logo, branding and other assets. CARU told TINA.org that Universe of Play’s shuttering is not the result of a review by its team. 

TINA.org and its allies, now joined by Common Sense Media, this week sent another letter to CARU expressing concerns about the COPPA program as it relates to advertising. 

Beyond brewing privacy battlegrounds, the metaverse could also be a victim of economic contraction. Disney has axed its metaverse division, a unit of about 50 employees, as part of a larger round of layoffs, The Wall Street Journal reported.