NFT, also known as non-fungible tokens, was one of the most hyped digital trends of 2021. In March, auction house Christie’s sold a digital art piece for US$69.3 million. Shortly after, founder of Square’s Jack Dorsey sold his first tweet using NFT for US$3 million, it seems like anything, and everything can be tokenised, and the media is in love with this concept. Memes, tweets, Nyan Cats, are being sold for tens of thousands to millions of dollars. Putting all enthusiasm and momentum behind, what exactly are NFTs? How does it matter to marketing?
Though coined by the media as “the technology of the century to revolutionise the creative industries”, NFT’s architecture is based on blockchain, which isn’t entirely uncharted.
In fact, we have been exploring blockchain’s applications and implemented them in payment and logistics-related projects long before the NFT hype. However, from a marketer’s perspective, what we find fascinating about NFT is the movement that it gave rise to, the awareness it got, the heads that were turned and how brands can leverage this phenomenon.
NFT as a creative format
Most creatives emerge from a single “big concept” or unique value proposition. Whether it’s a slogan, key visual, copywriting, video or offline installations, creative formats will be decided after the “big concept” is fully-fledged out. But in recent years, with the rapid development of innovative engagement technologies on platforms and hardware, combined with the first mover tendency on social media, we are seeing a shift in mindset, where the creative format becomes the priority that drives the creative process instead.
Tracing back, the flappy birds game popularised the use of face detection features on Instagram filters, brands immediately followed to create their interpretation. These technology-based trends are becoming the norm and brands will have to better equip themselves to react flexibly to surf the tide.
There are several good examples of brands' attempts to catch the NFT trend. Taco bell reacted immediately after the sales from Christie’s, creating its NFT using digital artwork of its infamous tacos and auctioning it off a week after stimulating social buzz and dialogue. Gucci created a collection of NFT virtual shoes that could be viewed through an AR camera. Nike even took it to the next level.
In 2019, Nike patented a concept known as “Crytokicks”, which are future shoe design blueprints in the form of an NFT. Once sold, the shoe will be placed in the production and the customer will receive the actual shoe and the ownership of the NFT, bridging the gap between digital assets and their physical form.
NFT strength lies in its blockchain feature enabling it to certify a digital asset’s uniqueness and records of ownership. From a practical perspective, this is quite significant, every digital item or physical item can now be authenticated without the worry of forgery. In fact, recently we have explored this opportunity with artists and musicians in embedding their physical creations or packages with hidden QR code tags & RFID tags to access their NFT in real-time for certification purposes.
On the other hand, from a marketer’s perspective, the value lies in NFT's ability to create scarcity and explore building the experience that surrounds its ownership. For example, a singer or band can release a special edition digital album using NFT to ensure its originality and quantity. We as marketers can then create experiences from giving special backstage access, front row fan meets, dinner arrangements, to supporting gifts such as the vinyl records to enhance the privilege of owning the NFT. We can develop the mechanics that extend the value of transferring ownership, the possibilities are endless. To conclude, the audience on social media have raised their expectations over the years.
Brands' leverage on popular trends using postings or videos to stay relevant is expected, the audience now demands and anticipates how brands would integrate new technologies into their overall experience.
This article is sponsored by Prizm and written by Clement Lee, digital strategist of Prizm Group.