Citi's report estimates that the target market for the metaverse economy could be worth $8tn and $13tn in 2030, so it is no surprise that watch brands have increased investment. At Bulgari, improving technology to make "more elegant" avatars is one of the tasks facing its innovation business unit, which was launched in 2020 and has a creative laboratory in Rome.

Meanwhile, Tag Heuer, the Swiss watchmaker, advanced its digital strategy with the launch of a non-fungible token viewer for its Connected Calibre E4 smartwatch. This feature, available as a free update, allows owners to display NFTs - digital tokens stored on a blockchain representing unique assets such as art or media, and viewable on wallet apps - on their watch face. The watch connects to the owner's wallet app in order to verify authenticity.

Frédéric Arnault, chief executive of Tag Heuer, which is owned by LVMH, says it "feels natural" for the company to investigate this world and want to come with a real vision to keep it sustainable and drive value. Arnault, a collector of NFTs himself, says his brand is going after NFT enthusiasts.

"It is very important as a starting point to acknowledge and respect the community, and so we deliver a feature and a product that is useful and exciting for the community," he says.

In May, Tag Heuer started to accept 12 cryptocurrencies, including bitcoin and ethereum, for purchases on its US website, but is yet to issue its own NFTs. Thomas Chauvet, head of luxury goods equity research at Citi, believes that, apart from connected watches, brands are not yet ready to explore the commercial opportunities of the metaverse, in much the same way that they were initially reluctant to embrace e-commerce. Instead, he says, they will focus on its as a "communication tool" or "authentication opportunity".

Panerai, the Italian watchmaker, launched its NFT recently to "upgrade the customer experience", according to Jean-Marc Pontroué, chief executive.

Buyers of the Radiomir Eileen Experience Edition watch - it is limited to 50 pieces - were invited to sail along Italy's Amalfi coast aboard a classic yacht after which the watch was named, and received a digital wallet. This included an NFT artwork which unlocked exclusive content, services, events and offers.

"We wanted to add this NFT to bring added value to customers to say we will connect with you before the experience starts, during the experience, and after the experience," says Pontroué. "The NFT is a modern platform to connect with people who love our brand."

Panerai, which is owned by Richemont, plans to give every watch a digital passport next year. This is something Breitling has done since 2020 to allow owners to prove a watch's authenticity, as well as access the warranty programme.

Both watchmakers have partnered with Arianee, a French company that helps brands to create and distribute NFTs and leverage the tokens. Pierre-Nicolas Hurstel, Arianee chief executive, calls it "a new loyalty tool". It transforms the relationship between brands and communities, he says, because the customer keeps control of their data. At the same time, the brand regains control of its digital presence as it no longer has to rely on platforms such as Instagram to reach customers.

"The overarching goal is to build a decentralised database of owners that you can then engage thanks to the mechanisms of NFTs, to whom you can offer a seamless journey across digital, physical and immersive channels," Hurstel says.