Amazon is leaning into virtual influencers to engage younger consumers

Since 2015, Amazon’s venture capital arm has invested in consumer technology startups focused on everything from AI and voice technology to entertainment. But The Alexa Fund's most recent partnership may surprise you.

In February, Amazon announced that it had led a $20 million Series A investment round for Superplastic, a character-design studio that specializes in making celebrities—digital celebrities, that is.

Superplastic’s computer-generated virtual influencers have social media accounts, cult followings, and brand partnerships, just like human influencers. And the characters are surprising, to say the least.

There’s Dayzee, an “incorrigible flirt” who is blue with spiky purple hair, who holds PhDs in nuclear physics and aerospace engineering, and has more than 700,000 followers on Instagram.

Then there’s Janky (a dumpster-diving “streetwear icon” who is also a…cat?) and Guggimon (a “fashion horror artist, ax collector, and DJ,” who happens to be a white rabbit with vampire-like teeth).

So, where does Amazon fit into this slightly confusing space? Alexa Fund director Paul Bernard said Amazon has been watching the synthetic celebrity trend gain traction and believes it represents a new form of intellectual property targeted to younger generations.

“In a lot of ways, this is representing how the metaverse is actually taking shape in customers’ lives,” Bernard told Retail Brew via email. “It’s an engaging way for brands to role-play with customers and fans, and we can see this playing out on a global scale.”

A burgeoning retail trend?

Virtual influencers are already taking off in certain markets. In China, for example, the virtual influencer industry is projected to be worth more than $42 billion by 2030, and elsewhere in Asia, brands like Calvin Klein, Nike, and Adidas have paired up with top digital celebrities from Japan and Korea.

Some US brands, like Pacsun, are already on board. In 2022, Pacsun partnered on a back-to-school campaign in 2022 with virtual influencer Miquela (whose creator, Brud, is another recipient of Amazon funding.)

The trend is also rapidly expanding among US consumers, where one survey found that 58% of consumers already follow at least one virtual influencer. That number jumps up to 75% when looking exclusively at consumers between the ages of 18 and 24.

State of the art: Superplastic was born out of founder Paul Budnitz’s love for cartoons and animation, and his background selling designer toys.

Partnering up with larger companies usually meant giving up the intellectual property rights to his characters, Budnitz said. So he decided to work backward.

“What if we could make our own animated characters…use social media to make those characters famous…and then once they’re famous, people will come to us,” he explained. “That was a really dumb idea. And it worked! Unbelievable! And we’re adding 18 million followers a month now.”

Digital brand partners: There are a few key things that set Superplastic’s characters apart from living, breathing influencers.

For one, “They’ll show up on time, and they’re unlikely to get canceled,” Budnitz said.

For another, characters like Janky, Guggimon, and Dayzee—who have walked in fashion shows for Tommy Hilfiger and been reimagined as NFTs and ceramic collectibles in partnership with Gucci—can help brands appeal to a niche demographic.

But it’s the digital nature of these “celebrities,” who aren’t constrained by gravity or safety concerns, that makes Superplastic’s offer so unique when it comes to helping brands reinvent themselves for new audiences.

Budnitz pointed to Superplastic’s recent campaign with Mercedes-Benz to launch the 2023 E-Class which reinterprets the classic nodding dashboard dog as “Superdackle,” an animated dog with a gold tooth whom Budnitz describes as “gnarly.”

In an animated video announcing the partnership, Superdackle takes off on a wild nighttime ride with Janky and Guggimon, traveling NYC at warp speed before launching into space, encountering an alien spaceship and a mystical space whale (don’t ask).

Enter Amazon: Amazon appealed to Budnitz as a partner because of the tech giant’s wide reach, he said. “They’re just all over the map, and so for us, it’s really just a playground of new things.”

Budnitz said he’s in talks with Amazon about adding touchless checkout to Superplastic’s NYC brick-and-mortar store, but that he envisions endless ways his characters can “plug into” what Amazon does.

Amazon, for its part, is hesitant to weigh in on whether you’ll see Dayzee, Janky, and Guggimon at your local Whole Foods.

Bernard declined to comment on specific integrations with Superplastic, but said the partnership is a sign of the times.

The Alexa Fund invests in technology that is “relevant to the future of Amazon’s business,” he said.

“We are at the beginning of fundamental shifts in what it means to be a customer, creator, and entertainment fan, and we see the emergence of these technologies as a large signal of this changing landscape.”