Why brands need to jump on the NFTs bandwagon?
NFTs or Non-Fungible tokens are non-tangible assets or digital certificate of authenticity, which acts as a token for virtual goods like an image, video, animation, etc. These cryptographic assets are unique, cannot be interchanged, and are maintained in a digital ledger using blockchain technology. Over the past few years, NFTs have popped up across the digital collectible arenas like rare sports cards, music memorabilia, digital art, etc., and imaginative brands, which value its potential want the largest slice of the pie.
While much of the buzz around NFTs have been around digital artwork, the past couple of years has seen this model expand beyond just creative jpegs. Thanks to the organic growth and support from media headlines, NFTs are slowly becoming mainstream and opening floodgates to a new type of storytelling and consumer dynamics which was unimaginative a decade ago.
Unfamiliarity and ignorance have restricted a lot of brands to steer clear of NFTs in the past, however creative, risk-taking brands have tasted success. A case in point could be the classic example of Taco Bell where five versions of digital artwork were put on sale and were auctioned off within 30 minutes in 2021. A strategically clever move lauded by many, as not only did the brand raise money for their Taco bell charity but also announced bringing back fan-favourite potatoes on the menu.
It's a preconceived notion that NFTs are better suited for brands who claim to have a 'loyal' following and a known persona, however, the popularity of NFTs is tied to its perceived social value. Before jumping on the bandwagon and wanting to taste success like the peers, it is pivotal for brands to understand where they sit in the spectrum of the cultural conversation. This will determine if NFTs are the right fit for them or not.
Not only for brand awareness, but NFTs also unlock a whole new world for monetizing digital media as well. For instance, if a well-known sports brand created a video ad featuring an international sports icon, this video will end up being promoted on Facebook, YouTube, etc through ads. However, through NFTs, the same video can be auctioned and sold off to customers who believe in the values of the brand and the sports icon. What's interesting is that the sports brand can make the original copy accessible to anyone who wants to own the video, allowing the IP (intellectual property) to be resold several times and the sports brand getting a creator cut with each transaction.
Marketing is all about riding the current trends and banking on the creativity to harness enough excitement around a brand. Customers, especially loyal ones are willing to pay for experiences and values they believe in. Brands can capitalize on this by turning their best IPs into NFTs. Apart from converting videos or Taco Bell digital artwork into NFTs, there are innumerable ways brands can tap into the potential of these crypto-collectibles. Brands can create exclusive experiences in the form of facetime with celebrities, produce original digital collectibles to engage with their core fan-base. The possibilities are endless and only limited to the imagination of brand marketers out there.
There are several advantages of producing NFTs which brands, especially those unfamiliar with the concept do not know about. These tokens are 1.Timeless 2.Their value only appreciates over time 3.They monetize content-creator, 4.Opens up a revenue stream for the brand, 5.Tells a brand story the way it is meant to be told and 6.Delivers a creative and unique brand experience for a customer. It is now more important than ever for the brand to realize the potential of NFTs and jump the bandwagon, however, it is equally important for them to not rush just to make a quick profit. Gradually build authenticity by providing real value to the customers with a design of the future in the mind.
Be open to collaborations, learn from peers, become an active member of the NFT community as in the end brands are looking to cross the bridge from a transactional relationship with their customers to a connected one. While there is speculation that NFTs are a bubble waiting to burst, there's a lot we don't know about them and a lot of unexplored territories yet. More brands will and should jump the gun as NFTs slowly become mainstream and experimental.
The customer today no longer is looking for the cheapest option. Customers want to understand the story behind a brand, the values it holds. Individuals want to relate to these values and accept the brand. Creating NFT's for a brand is a way for them to show to their customers that they are listening, willing to adapt, and deliver them in a way appreciated by them. To tap into the true potential of NFTs a far wide-reaching consumption experience needs to be created. An experience that can accrue wider social significance and its values transcends beyond an expression of the owner's identity.