NFTs grew by 11,000% in one year. Is it a good idea for brands to consider them as a strategy?
Posted: Thu Dec 05, 2024 6:26 am
Deborah Black
Mar 7, 22 | 9 min read
nft benefits
Reading time: 7 minutes
If following the news is part of your routine, you've probably come across the word NFT several times in recent months.
The acronym for Non-Fungible Token was voted Collins Dictionary's word of the year , with usage growing meteorically by over 11,000% in 2021 .
The reason for this surge is that NFTs generated $23 billion in transactions last year according to the 2021 Dapp Industry Report . That’s why everyone wants to know how to get into this multi-billion dollar market.
Companies around the world have joined the NFT race as a way to rethink their brand and get closer to markets that are still little explored. But what are NFTs anyway?
Keep reading to understand more about the topic!
About NFT and Blockchain
As we already said, NFT is the acronym for Non-Fungible Token. In technology, the word Token can be defined as a digital representation of an asset. In turn, Non-Fungible means something cannot be replaced by something else .
An easy way to exemplify what a non-fungible good is is the art market: how many Van Gogh paintings are worth a Mona Lisa? There is no such relationship, as they are unique, distinct and irreplaceable works. On the other hand, you can exchange a 10 dollar bill for 2 5 dollar bills because they are fungible.
These unique, distinct, and irreplaceable electronic codes are recorded by the blockchain system, which is the same technology used in cryptocurrencies such as Bitcoin . The blockchain system records transactions in an encrypted form, and in theory, the information included in the blockchain cannot be changed.
In this way, the unique file of the digital somalia email address asset is connected to the unique certificate generated by the blockchain , guaranteeing the authenticity and ownership of that asset.
An NFT is a unique digital certificate, recorded on a blockchain, used to record ownership of an asset, such as a piece of art or collectible.
Any person or company can link their assets, whether digital or physical, to an NFT, they just have to find a company that provides the service and a fee is usually paid for the creation of these digital assets.
These assets are typically traded on marketplaces, such as OpenSea and Rarible , which act as shop windows where NFT owners can leave them exposed for purchase offers.
How do brands use them and what results do they get?
NFTs became popular due to multi-million dollar transactions for artworks such as Beeple's The First 5000 Days and celebrities who joined the movement as if they belonged to a club that has exclusive assets.
Neymar, Jimmy Fallon, Eminem and Snoop Dogg have all had images of algorithmically generated monkeys, the Bored Ape Yacht Club , purchased for millions of dollars.
Although they became famous due to these events, NFTs are an emerging technology. There is a blue ocean of possibilities for brands and we can already see some microtrends emerging due to new behaviors and technological innovations.
After its popularization, it was possible to observe companies from various sectors adopting brand strategies using NFTs as a power to connect with customers and do new business.
Outfit
Some companies have been working with the connection between the physical and the digital. This is the case of companies like GAP and Adidas , which have created NFT collections that allow the buyer to access physical pieces exclusively.
The strategy behind these initiatives is mainly aimed at keeping the community spirit and exclusivity behind the brands active , strengthening the idea of creating fan clubs and building customer loyalty.
Other clothing brands have decided to adopt collaborative strategies. This is the case of Gucci and Nike , which invested in shares with companies and artists to create clothing collections available in NFT in exclusive partnerships, expanding their visibility and reputation.
By the way, Adidas also joined this trend of collaborations and launched a collection in collaboration with Bored Ape Yacht Club, the same one with the celebrity overalls.
It is possible to see the penetration of brands in association with digital gaming markets , for example. This guarantees brands access to customers on a platform previously little explored in terms of marketing: GAMES.
Food Sector
NFTs are not exclusive to the clothing industry. In the food sector, McDonalds adopted a visibility strategy to touch the hearts of its most loyal consumers in the United States on the occasion of the 40th anniversary of the fast food chain's favorite burger: the McRib .
For the launch of the burger, a campaign was carried out where customers who retweeted an invitation would participate in the draw for the network's first NFT, thus increasing the brand's visibility on one of the most visited social networks in the world.
Mar 7, 22 | 9 min read
nft benefits
Reading time: 7 minutes
If following the news is part of your routine, you've probably come across the word NFT several times in recent months.
The acronym for Non-Fungible Token was voted Collins Dictionary's word of the year , with usage growing meteorically by over 11,000% in 2021 .
The reason for this surge is that NFTs generated $23 billion in transactions last year according to the 2021 Dapp Industry Report . That’s why everyone wants to know how to get into this multi-billion dollar market.
Companies around the world have joined the NFT race as a way to rethink their brand and get closer to markets that are still little explored. But what are NFTs anyway?
Keep reading to understand more about the topic!
About NFT and Blockchain
As we already said, NFT is the acronym for Non-Fungible Token. In technology, the word Token can be defined as a digital representation of an asset. In turn, Non-Fungible means something cannot be replaced by something else .
An easy way to exemplify what a non-fungible good is is the art market: how many Van Gogh paintings are worth a Mona Lisa? There is no such relationship, as they are unique, distinct and irreplaceable works. On the other hand, you can exchange a 10 dollar bill for 2 5 dollar bills because they are fungible.
These unique, distinct, and irreplaceable electronic codes are recorded by the blockchain system, which is the same technology used in cryptocurrencies such as Bitcoin . The blockchain system records transactions in an encrypted form, and in theory, the information included in the blockchain cannot be changed.
In this way, the unique file of the digital somalia email address asset is connected to the unique certificate generated by the blockchain , guaranteeing the authenticity and ownership of that asset.
An NFT is a unique digital certificate, recorded on a blockchain, used to record ownership of an asset, such as a piece of art or collectible.
Any person or company can link their assets, whether digital or physical, to an NFT, they just have to find a company that provides the service and a fee is usually paid for the creation of these digital assets.
These assets are typically traded on marketplaces, such as OpenSea and Rarible , which act as shop windows where NFT owners can leave them exposed for purchase offers.
How do brands use them and what results do they get?
NFTs became popular due to multi-million dollar transactions for artworks such as Beeple's The First 5000 Days and celebrities who joined the movement as if they belonged to a club that has exclusive assets.
Neymar, Jimmy Fallon, Eminem and Snoop Dogg have all had images of algorithmically generated monkeys, the Bored Ape Yacht Club , purchased for millions of dollars.
Although they became famous due to these events, NFTs are an emerging technology. There is a blue ocean of possibilities for brands and we can already see some microtrends emerging due to new behaviors and technological innovations.
After its popularization, it was possible to observe companies from various sectors adopting brand strategies using NFTs as a power to connect with customers and do new business.
Outfit
Some companies have been working with the connection between the physical and the digital. This is the case of companies like GAP and Adidas , which have created NFT collections that allow the buyer to access physical pieces exclusively.
The strategy behind these initiatives is mainly aimed at keeping the community spirit and exclusivity behind the brands active , strengthening the idea of creating fan clubs and building customer loyalty.
Other clothing brands have decided to adopt collaborative strategies. This is the case of Gucci and Nike , which invested in shares with companies and artists to create clothing collections available in NFT in exclusive partnerships, expanding their visibility and reputation.
By the way, Adidas also joined this trend of collaborations and launched a collection in collaboration with Bored Ape Yacht Club, the same one with the celebrity overalls.
It is possible to see the penetration of brands in association with digital gaming markets , for example. This guarantees brands access to customers on a platform previously little explored in terms of marketing: GAMES.
Food Sector
NFTs are not exclusive to the clothing industry. In the food sector, McDonalds adopted a visibility strategy to touch the hearts of its most loyal consumers in the United States on the occasion of the 40th anniversary of the fast food chain's favorite burger: the McRib .
For the launch of the burger, a campaign was carried out where customers who retweeted an invitation would participate in the draw for the network's first NFT, thus increasing the brand's visibility on one of the most visited social networks in the world.