James Martin, Associate Director - Global Marketing, FutureBrand, discusses how although not a new concept, it wasn’t until digital artist Beeple sold his artwork "Everydays – The First 5000 Days" for nearly 70 million dollars that the world really started to talk about NFTs (Non-fungible tokens).
For many the concept is still alien, a fad that will eventually fade away into the digital ether. However, since Beeple’s sale many - including blue chip brands such as Louis Vuitton, Nike and Coca Cola - have seen the potential in the all-digital, completely unique format.
As a format that can offer a new set of storytelling possibilities for brands, NFTs should be taken seriously, and not just by digitally native companies. We have already seen countless examples of how NFTs can allow brands the ability to offer customers new experiences with their products and services. The very nature of the format offers exclusivity and can appeal unequivocally to the digital collector’s mindset brought about by the likes of Fortnight’s loot boxes and the FIFA franchise’s Ultimate Team card expansion. For many, owning something that only you or a few others have is the very pinnacle of why they choose that brand - Yeezys and Supreme spring to mind. So, if a brand can incorporate the same level of scarcity into their offering, the value of said offering will surely rise.
Alongside exclusivity, the NFT format can offer brands the ability to expand the scope of what it’s capable of delivering. Take the NBA, who wanted to reach a more global market and showcase basketball beyond its heartland audience. They chose to partner with world-renowned music artists to package up their personal favourite highlights into collectible ‘Top Shot’ packs. These packs helped generate buzz within a wider community for the season's finals, which brought in a significant amount of revenue to the league. In this regard, the relatively simple use of NFTs helped connect the brand to an audience that might otherwise be unattainable through standard brand activations or experiences.
NFTs also offer the ability for a brand to focus on less tangible parts of its core offering, such as messaging. With larger brands such as Coca Cola already tapping into NFTs to raise money for its charitable partners, it's easy to see the benefits of highlighting what else your brand has to say through the medium. NFTs can offer these same opportunities to smaller brands, allowing them to create new revenue streams, the profits from which can be donated to charitable causes and help establish their brand as socially or ethically minded.
The NFT is still in its infancy when it comes to being properly utilised by brands. Virtual hoodies and meme certificates may paint the picture of a simple flash in the pan, but beneath the surface, there seems to be a greater tool at the disposal of any brand willing to take them seriously.