How brands are using NFTs?

Source: Pixabay.

NFTs are digital items that have been around for almost a while, however, like bitcoin or blockchain, sometimes we don't understand all the fuss, or how they are worth so much money.

However, every day bigger companies are getting into this game, and believe it or not, the gains have gone beyond the positive.

However, before investing in a new type of technology it is better to educate ourselves about it, that is why in this article we will show you how big brands are using this technology and how yours could use it to their advantage.

Let's go straight to the lesson!

NFTs: What are they and how do they work?

NFTs have been around since almost 2017, still, too many of us have no clue about what these are. Is understandable, the first reason is that it has a close relationship with cryptocurrencies and blockchain, two digital topics that can be hard to understand, for your fortune we have some articles talking about them, go ahead and read them if you like, then come back for this.

Now, to  understand it from its core meaning, NFT stands for:

• Non
• Fungible
• Token

Now, it may not get clear as water, but we are getting there.

First, the term "fungible" stands for something that can be exchanged for something of equal or similar value, this means that these are goods that you can trade for something of equal or similar value.

Okay, now we understand this part, but what happens when this item is "non-fungible? Well, this is the exciting part. A non-fungible token is something unique that can't be exchanged for any equivalency.

A CD from The Beatles is a fungible token, you pay for it and get your CD, but, the guitar that John Lenon used to play in its first concert is non-fungible, because it is unique, and there is no other guitar like this. If you want to see it, these tokens are like diamonds, which there are no other equal than the one you own.

And this word, "own", is something we want to emphasize because once you buy an NFT you are the complete owner of it, there are no third-party agencies who benefit from it, it is yours and only yours.

Non-fungible tokens are created by using blockchain technology, and what makes them different from cryptocurrencies is their unique identification codes and metadata that differentiate one from another.

This digital trend started with the CryptoKitties, in 2017, a combination between Tamagotchi and trading cards that brought this type of items to the digital scene. Each of these digital pets ended up costing up to $140,000.

As you can see, these items are a good investment, so keep scrolling down to learn more about them. 

Source: YouTube.

Why Are NFTs important for brands?

NFTs can play a huge part in your marketing strategy since they can be used to represent digital files like video, audio or art. Their versatility allows you to represent innovative types of content like virtual worlds, virtual real estate, fashion and much more.

With this, you have new ways of brand storytelling and consumer interaction, which are key factors for your marketing strategy.

NFTs allow  your brand to:

• Create new ways to interact
• Immerse customers into unique brand experiences
• Be unique in the marketplace, since these are your creations
• Get more interaction
• Create interest in your brand and products.
• Increase your conversions
• Drive revenue

What Consumers Have To Know About NFTs

Although NFTs seem to be a precious investment, there are some aspects where both brands and customers must have their eyes wide open, because as fake Gucci purses, there can be some scams for NFTs. 

For starters, you have to make sure that the seller owns the complete rights of the token he is selling. Nevertheless, Justin Giudici, Head of Product at Telos Foundation says that this issue shouldn't be a cause of alarm, since any marketplace has a bunch of scammers, like Gucci or Nike.

Justin Giudici says "Before purchasing any NFT, research the asset and ensure that the person/brand isn’t scamming you, or selling assets that aren't theirs to sell. With mainstream brands joining the fray, there is an opportunity for scammers to take advantage of the hype." He also mentions that some platforms don't have the best verification methods set up, so there is a tiny risk involved.

Akbar Hamid, Founder and CEO of 5CRYPTO by 5th Column, says that before investing in any of these new currencies, it is crucial to learn more about blockchain, potential investors and know how to open a wallet. Hammid says that there are plenty of NFT communities and if you want to invest in this you have to learn deeply about it.

How do big companies use NFTs?

Nike 

Sneaker collectors are capable of paying absurd amounts of money for a limited edition pair of Nikes, and this has been known to capitalize on the brand towards the NFTs aspect.

This is how now the footwear brand allows you to buy digital copies of pairs of shoes that have been called Cryptokick, which you can save in your virtual locker.

Although these shoes are not usable in the real world, you can put them on your characters in video games like Fortnite, giving you an unmatched pair that will look great on your characters.

Source: YouTube.

Taco Bell 

Yum Brands, the owner of fast-food restaurants like Pizza Hut, KFC and in this case Taco Bell, has its strategy around NFTs. 

The Mexican food franchise launched a series of NFT gifs on the marketplace Rarible, with all of these being sold in under 30 minutes. This campaign shows that these tokens are profitable for companies with gifs being sold for thousands of dollars, but, in a less capitalistic way, this campaign was used to raise funds for a scholarship program Taco Bell is associated with.

Some of these items are being resold for $3,000.

Source: YouTube.

Team GB’s NFTs for the 2021 Olympics

These 2021 Olympics weren't that exciting due to the lack of international fans and supporters of this event, nevertheless, there were some innovations with the introduction of an NFT campaign by Team GB.

The British Olympic Committee created an NFT show where fans could buy unique collectibles, like paintings by artist Ben Mosley, or have unique experiences with gold-medal winners from the Team GB.

Regardless of low ratings, this was a great initiative to support athletes by commemorating their athletic achievements and raising funds for the British Olympic Association.

Source: YouTube.

The NBA and ‘owning’ moments digitally

Looking to increase their appeal to European audiences towards digital and direct to consumer approach, The National Basketball Association created the 'NBA TopShot', a marketplace where fans could buy moments from their favourite players and get a certificate with an original clip.

This is like trading cards, but now are live actions moves from their favourite team members, which could be the future of this field.

Source: YouTube.

Coca-Cola

The Coca-Cola Company create a collection of digital collectables to re-imagine some of their iconic assets for the metaverse, all this in the International Friendship Day. 

This collection included many original items like a futuristic redesign of the Coca-Cola delivery jacket, which users can wear on Central and, a decentralized 3D virtual reality platform. 

The earnings of this campaign went to Special Olympics International, the world’s largest organization for disabled athletes.

Source: YouTube.

Ubisoft

As we see, NFTs is an item that is valuable for video games, and in the case of Ubisoft, the company created an Ethereum-based Rabbids game that lets players buy characters from this popular game.

But there is a twist with this game because players don't own their Rabbids for too long, instead, these can be stolen by another user. These campaigns aim to go to charity UNICEF, which as we've seen is a trend among brands using NFTs.

Ubisoft's blockchain editor director Nicolas Pouard says "We wanted to do something crazy, something different, and we wanted to create our own NFTs and see how far we could go in the programmable aspect of things".

Vodafone

In 2019, smartphone giant Vodafone created an augmented reality game where players had to hunt down NFTs named Vatoms, this was part of a promotional Apple giveaway.

The project was so successful that the company created another version in 2020, making a partnership with Samsung to offer players thousands of tech prizes that were connected to the NFTs.

How could your brand enter into the NFT game?

With NFT technology you can provide a new user experience and upgrade your awareness and affinity. A good example of these is mobile advertising campaigns that use NFTs to distribute across many digital platforms. You can use these tokens to give personalized gifts, vouchers, discounts or any plus you want to offer.

These digital items can also help your brand collect data, or reward crowdfunding, like companies such as P&G and Starbuck that source ideas and feedback from customers for quite some time. In this way, users and co-creators get rewarded for their help by owning a share in the final output.

And like the example of Coca-Cola or Ubisoft, your brand could use NFTs for charity events, which connects with users from generation z and millennials, and also they tend to be the most tech-savvy consumers. You could work with CodeDesign to improve your marketing campaign and improve sales. Codedesign has a physical presence in Lisbon, Zurich and Manchester, but we consider anywhere there's WiFi to be our digital office space.

Source: YouTube.

Final Thoughts

Non Fungible Tokens, Bitcoin and the Blockchain are all part of the future of marketing, and although they are sometimes difficult to understand, they will not stop us from adapting and mastering these strategies in time.

Although we see that NFTs are closely linked to the world of arts, sports and video games, we have seen how brands that have nothing to do with Taco Bell or Coca Cola have managed to enter this world, having incredible profits.

The idea is to use your creativity to see how you can overcome this wave of NFTs and enter this trend, for that it is necessary to study and know information about those who already surf this trend.

At CodeDesign we keep you informed about any trend or novelty in the world of digital marketing, contact us if you want advice for your own brand.

See you in a new article!

Feel free to contact us to see the unprecedented growth of your business.

 

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