How to make a deformable body whenever is takes from any rigid body?

Does anybody know how to make a very simple deformable body as shown in the picture? the comments say it used world position offset and multple parameter values in the material editor, but how can you implement it?

Not sure about what’s in that specific picture, but these videos from Epic might help in that area.

https://www.youtube.com/watch?v=enx6ShyKUL8

heres the video