March 16, 2021
Why your brand should be paying attention to the current NFT craze.
JAKE LEEMAN | DIRECTOR, EMERGING TECHNOLOGY
Fungible. Not a word we use much in marketing circles. But the term “non-fungible tokens” (NFT) is everywhere these days. Taco Bell did a limited release of NFT animated GIFs. Kings of Leon released their latest album as an NFT, and the NBA’s Top Shots product has raised over $230 million in sales with its digital NFT collectables.
So what exactly is an NFT? Well, in the simplest terms possible, it’s a completely unique digital asset—which could be anything from images to videos to music—that’s built using blockchain technology. There are several links to great articles at the bottom of this post that will help you dive deeper into the world of understanding NFTs.
But the question before us is less “What are they?” and more “Should you be paying attention to them?” for your brand. And the answer is unequivocally yes.
What started as a purely artistic expression using blockchain technology in 2017, where CryptoKitties and CryptoPunks were given away for free, has now grown into a market worth over $338 million, and it’s only growing more and more every week. It’s also easy to see how much of that valuation the NBA has captured. What have they done that’s so unique?
The NBA has combined its vast film library with excellent digital production value, added in a full measure of collectibility, and topped the whole thing off with a dash of the marketplace’s current crypto-obsession. Together, this was a recipe for overwhelming success. Will it last? Will this massive growth trend continue? Will these digital tchotchkes that you can view for free actually retain any value in the years to come?
Time will tell for the NBA, but that matter is irrelevant for brands. The fact is that NFTs are here to stay and they are only going to grow and evolve over time. The technologies involved—blockchain, cryptocurrencies, and digital asset exchanges—are all trending exactly as the Gartner Hype Cycle predicted in 2018 and 2019: up and out of the Trough of Disillusionment and into the Slope of Enlightenment. In short time, NFTs will continue on to the Plateau of Productivity and that is exactly why you should be paying attention now.
Consider how your brand might be able to play within this space. Don’t try to capitalize on the current digital gold rush, but rather focus on experimentation. What digital assets would fit best with your brand and products? How would you best connect directly with consumers in this technology-forward ecosystem? What is the most unique aspect about your brand that would be ideal for creating an NFT?
From a marketing perspective, NFTs are making us reconsider the value of our content just as much as the products and services we sell. There is a relational currency at play here that brands cannot ignore, as NFTs allow you to form a very unique relationship with your customers. What do they crave enough that would motivate them to spend their hard-earned money? That’s what you should deliver. Because others will. Imagine Nike selling shoes with digital collectibles of your favorite sports star attached. Added value, instant gratification, and insane desirability. Easy example? Sure. But it proves the model.
As NFTs continue to evolve over the next decade, we are looking at the next stage of collectibility and entertainment for consumers, whether it’s in sports, movies, music, or brand marketing. You don’t want to be the last brand to arrive at the dance, so it might be time to at least warm up the car. Roll up your sleeves and figure out how NFTs work. Create a digital wallet. Buy some animated GIFs and marvel at how you just spent your hard-earned money. It’s somewhat clumsy. It’s definitely messy. But it’s also exciting. It’s “now.” And quite possibly, the future.
You’ll find great articles that explain more about NFTs here:
Interested in learning more about how NFTs might work for your brand? We’d love to talk!
