The coming year will see many brands dipping a toe in the NFT waters for the first time. But there’s still a lot of confusion about how NFTs can be used – and even what they actually are. Which is why We Are Social assembled a team recently to provide clarity and some inspiration via a webinar called NFTs: Navigating a New Frontier, hosted in part on the Decentraland VR platform.
It also marked the launch of We Are Social’s newest offer: We Are Social XYZ. Created to give clients access to Web3 expertise from across We Are Social’s global network, it will act as a central source for strategic insight, creative expertise and purposeful market R&D relating to the emerging realms and ecosystems of tech encompassing NFTs, synthetic realities (including the metaverse), gaming and more.
One job the webinar set itself was to explain NFTs (non-fungible tokens) and how their increase in popularity is a hallmark of Web3, the newest iteration of the World Wide Web, where ownership is becoming widespread.
Millions of internet users around the world have purchased digital objects of some kind. While NFTs are also digital objects, what defines them are these three things:
● they are unique, i.e. non-fungible, just like the Mona Lisa is a one-off, versus a fungible item, like a dollar bill
● their provenance is recorded from the moment they are ‘minted’ continuing through each owner
● they are stored on a blockchain, which is essentially a digital ledger, meaning they can be accessed from multiple platforms as long as they are on the same blockchain
And clothes are only one example. An NFT can be music, an artwork, some kind of collectible, even a meme – any kind of digital artefact
Selling collectibles and virtual goods for consumers to use in digital worlds are not the only uses for NFTs. Other purposes include: acting as signifiers of common interest and helping people to find other like-minded individuals on the web, with CryptoPunks and the Bored Ape Yacht Club as prime examples; to function as branded merchandise and create social buzz; and to gamify brand experiences, like Burger King did as part of its Keep It Real Meals campaign. One of the most significant opportunities for brands lies in the potential for NFTs to foster deeper emotional connections with fans, by connecting them with unique experiences, exclusive access and even decision-making power. Check this recent campaign by Dalmore Whisky, or AS Roma’s widely acclaimed NFT strategy for inspiration.
To bring all this to life, Max Vedel, co-founder of Swipe Back and one of the webinar panellists, showed how brands could potentially create an NFT-powered campaign illustrated with the example of a pair of Oakley sunglasses. It started with the sunglasses NFT as part of a sales promotion tied to the purchase of a physical pair of Oakleys – activated with a mechanism like an in-store QR code or sent directly to the buyer’s NFT wallet.
Shoppers who may not be keen to possess the NFT could gain utility by trading it on an online marketplace such as Opensea (Oakley can receive royalties from each resale if it choses).
But if they keep the Oakley NFT, they might get benefits such as access to Oakley’s VIP community and associated perks like exclusive contests and promotions. There’s also the option to give the community power to influence the design of new frames, for example. This model is known as decentralised governance – one token equals one vote on the blockchain.
The NFT-owner could also mirror their real-world look in the metaverse by having their avatar wear the virtual glasses too. If they have NFT avatars in the same wallet, there is even the possibility to merge them into a new, super rare NFT. Max’s journey concluded with a look at the future and the potential for NFT wearables.
To wrap things up, the panel distilled the presentation into four principles for NFT-powered campaigns:
● Offer tailored experiences and make them portable between platforms
● Fit every customer’s needs by using different types of NFT, including ideas and music
● Think decentralised, by turning token owners into stakeholders
● Reward the community with engaging strategies like play-to-earn
For any marketers fearing that this new frontier is one that is far too complex, the advice from comms consultant and NFT collector Josh Ong is reassuring.
“Brands that succeed do a really good job of allowing the technology to stay behind the scenes. Saying ‘Now you can buy my thing, by the way here’s its provenance, and it’s immutable and decentralised’ – it’s too much for people,” Josh explained. “If you tell them ‘Buy this thing, it’s a digital good and comes with some cool extras’, brands really know how to market like that.”
And a final piece of wisdom: treat the NFT ecosystem as you would any culture you’re engaging with for the first time. Take it slowly and learn as you go. Maybe even think about giving We Are Social a shout for a chat about NFTs, Web3 and what it all means for brands in 2022. It’s an exciting time and the potential is limitless, we’d love to help you get started.