Today’s branding extends far beyond a piece of fruit on the back of your smartphone. It includes nearly every aspect of the brand’s identity, activity, endorsements, loyalty programs, and performance. Yet the one constant in all of these elements will always be: product differentiation. Crypto-based tools have seen an explosion of interest from brands and agencies that think Web3 will create a competitive advantage for their products. Already, the rise of non-fungible tokens (NFTs) is being harnessed by artists, brands, and creators in the business of selling physical items, digital products, and experiences to ultimately build brand awareness.
And it’s just getting started…
Kristin Robinson, Billboard’s music publishing reporter says, “Technology has always been a really big part of the music business, and has really dictated how we make music, how we consume music.” Those of us who are a little older can still remember records being sold at record stores, then onto tapes, and next was CDs. Nowadays, consumers purchase music overwhelmingly through digital downloads and subscription-based streaming services. Although making the switch might have initially appeared intimidating, most music listeners now have no trouble using these digital platforms to listen to their favorite musicians. Artists also sell experiences—attending a concert is an experience, and going backstage for an exclusive “meet and greet,” is also an experience. Many professional musicians now get the majority of their income from this sector as online music sales profits have grown ever-leaner over the past two decades.
NFTs allow artists to more deeply incorporate participation from their biggest fans. The performer will sell tickets directly to fans for their upcoming concerts by creating and issuing NFTs for tickets. These concert tickets will serve as both pieces of art and keys to unlock additional experiences between the fan and the artist; as they will be NFTs that the fans will own forever and may proudly display. In the future, fans will evolve from purchasing a song or album to “owning their fandom”. Building a digital relationship with the artist will bring the sense of an exclusive club along with it. The traditional method of ordering a t-shirt online will be replaced by real ownership of the NFT collection. Unlocking access to the shirt will become available to fans demonstrating different levels of commitment to the artist—downloads, subscriptions, buying merch, accumulated time listening to albums, and attending concerts.
Brands stand to benefit tremendously from the implementation of NFTs, especially as their industry comes to rely more and more on e-commerce. The online storefront, Shopify, released its NFT integration platform to unlock special perks, products and real-world experiences with merchants. Brands thrive on many elements that make NFTs possible, such as exclusivity, rarity, and special invitation. Those who acquire access to exclusive products are broadcasting their interests and priorities to the world. NFTs can forge design partnerships where NFTs provide a link between the real world and the virtual. For example, a brand could sell an NFT that represents a physical pair of shoes to be purchased in-store. Then through a partnership with online games, the brand could sell an in-game version of the NFT, allowing your digital avatar to wear them. Brands can reimagine the added value component for VIP-rewards clubs. NFTs use can be required to verify that someone has had the experience necessary to purchase the product. By owning the valuable pieces of the brand, consumers become members of an exclusive group who gain exclusive access to new merchandise drops, attend special events, and are provided with unique services.
Switching from Web 2 to Web 3
The most popular type of content is digital. Facebook, Instagram, and Twitter have all leveraged the concept of digital content to make billions of dollars. Still, there are some drawbacks for conventional creators, particularly the ease with which content can be copied on these open platforms. This results in disproportionate compensation for their innovations and creativity. Incorporating blockchain technology will verify authenticity, by identifying the original digital object, producing a limited number of copies from it, and then uniquely tracking each replica. NFTs will grant creators more control over monetization and content rights for their creative assets, allowing them to maximize their profits.
The Value of Every Idea Lies in the Using of It.
Nike needs no introduction, the venerable manufacturer of athletic footwear and gear began to employ NFTs in 2019 to pair digital assets with their own physical products. The integration of Web3 tools will allow users to securely buy and sell Nike products securely. Yum Brands, the parent company of some of the world’s most well-known fast-food franchises produced and offered for sale a number of Taco Bell NFT gifs, all of which sold out in under 30 minutes. During the 2021 Olympic Summer Games, Team Britain released their NFT campaign where fans could show their support by purchasing NFTs for various limited-edition collectibles. There’s always something that makes your brand different from the others. Something that makes it desirable and unique. NFTs’ lasting strength stems from the fact that it addresses problems for artists, brands, and creators alike by offering a known history, immutable ownership, and practical use cases for content.