NFTs or non-fungible tokens can be considered as a new way to improve digital marketing. A non-fungible token has it all: its uniqueness, its digital value, its authenticity, its community dimension. For a brand that does not want to be left behind, it is a must to test NFTs. However, it has to be done correctly.
Which brands have more interest in using NFTs for their branding?
An NFT is by nature a dematerialized good that cannot be interchanged. As a plot of land in real life can hardly be traded due to the complexity of measuring its value, an NFT is based on the same principle. It is a digital asset that can only be obtained after a purchase, commonly in cryptocurrencies. The blockchain system will make sure to certify and authenticate the NFT, which will make it almost impossible to falsify or counterfeit.
By virtue of its unforgeable and unique quality, the NFT proves to be a powerful asset in terms of capturing and retaining the audience. But the NFT is only useful for a brand when the latter uses it as a tool, and not as an overall strategy. Each brand must have its objectives in view, and use NFTs to achieve them. Using NFTs without a strategy will waste time and even money for the brand, and will discredit it in the eyes of its consumers. Consumers want unique experiences, it’s up to brands to create them.
As NFTs grow in popularity, many brands want to get into them. However, it is essential to ask the right question beforehand. It is in this way that matching the means of the brand product promotion to a target audience will be done without a fuss. This leads us to think that brands with the most interest in getting into NFTs are the following:
- Brands that already have strong popularity
- Premium brands, for the rarity and exclusivity aspect
- Brands already established / or wishing to establish themselves in the virtual world to strengthen their presence on the web
7 ways to boost brand image with NFTs
Although it seems difficult to say what NFTs will be like in 5, 10, 15 years, they remain as of now an amazing tool in terms of acquisition and retention of prospects. This activation will strengthen the brand image, especially based on these few means:
Tokenizing its contents
Having physical products is good. Having them in digital version too is even better. The NFT is based on the principle of traceable ownership with the power of Blockchain certification mechanism. Creating tokenized versions of its products can be a way to authenticate the quality of its products and even to offer a digital experience of its products to users. The principle of digital twin makes sense in this context. And an authentic and certified product will undoubtedly enhance the brand image. This is a way for the brand to enhance its material assets by dematerializing them.
Pizza Hut brand, for example, has made a name for itself by marketing digital pizza slices in the form of NFTs. Each slice represents one of their existing recipes. These very limited edition digital pizza slices were quickly taken over by consumers. At auction, the most expensive share is estimated at $8,824.
Certifying the authenticity of its products
As said above, obtaining a digital version of your product in the form of NFT is full of many advantages. The blockchain mechanism will in this case facilitate the gathering of lots of information relating to a product. This operation will establish a kind of brand transparency of its products towards its consumers. A user will develop a sense of trust in a brand that provides him with certification of the originality of its products. This is particularly relevant in the luxury sector, the one most victim of counterfeiting. Note that counterfeiting is not just bad for the brand image, but also for the customer who would have lost money buying a poor quality product.
As an example of certification, the AURA platform launched by the LVMH group has greatly contributed to thwarting counterfeiting. This blockchain provides for each product purchased, a traceability certificate in the form of NFT. This certificate provides the buyer with a plethora of information about the newly acquired property: from the origin, the extraction of the raw materials to the manufacturing, to the transport and logistics connections.
Extending products lines to digital
NFTs also offer brands the opportunity not only to tokenize their content, but to think about purely digital lines. It is also a way to attract a new audience on its brand content and to raise curiosity. The strong point of digital lines is also the financial value they generate for brands. As long as a line of NFT products created by a brand also bring value and benefits to its consumers, the brand wins. It is so because it derives a strong financial benefit, but also from popularity. Users are fond of novelty and turn to brands that “dare”.
One case in point is Nike‘s Cryptokicks. A Cryptokicks holder could combine them with other virtual shoes of the same brand to obtain a personalized and totally unique pair. In addition to being able to dress their avatar in the Roblox metaverse in these cryptokicks, the user could obtain a physical version of their personalized and unique pair of sneakers.
Amplifying the scarcity effect with NFTs
Another way for a brand to make its digital content profitable is to play on the scarcity effect of one of its most popular products. It is also the way to anchor through this rare collection, the identity, and even the brand storytelling. An NFT collection of the most popular brand products can consolidate all the prior brand elements: its products or service quality/services, its accessibility, its ethics, its values, its vision, its ambition, etc.
The Nivea brand, for example, has launched an NFT called “Value of Touch”. The idea was to highlight the preciousness of touch, however simple it may be, and to make it accessible to everyone. It had been noted that for 88% of people, sight was the most important sense. Nivea wanted to give back this importance and this power to the touch. The strength of this Nivea marketing action is also based on the fact that this very limited edition NFT was co-designed in partnership with Italian visual artist Clarissa Baldassarri, who suffered from visual impairment at the dawn of her career.
Diversifying the user experience, make it unique
NFTs are a powerful marketing tool in that they will allow the creation of a great amount of experiences for its consumers. It is about boosting the user’s perception of a brand, highlighting numerous advantages. Creating an emotional bond to your brand is a challenge that NFTs will meet. This can range from the creation of gamification experiences, exclusive events for owners of the brand’s NFTs, to the possibility of winning collection NFTs capable of offering users tangible benefits. It can range from a DAO (Decentralized Autonomous Organization) like the French brand Quequetterie did, or even a hunt for NFTs like the Louis Vuitton brand did through its NFT mobile game. In a DAO (Decentralized Autonomous Organization), the user will have decision-making power and voting power on the development or policies of the brand.
The Bored Ape Yatch Club (BAYC) gives its users the opportunity to benefit from the intellectual property rights on the brand name. The user becomes a part of the brand, gets benefits from it and is no longer just a wallet for the brand. It’s the creation of a sharing environment, where each stakeholder is a winner, the brand as well as the user.
In addition to gamification, reward concepts for the most active users, it is also possible for brands to offer NFTs that change over time or that can be associated. For this case, the holder of the NFT Human One created by the artist Beeple, will see his NFT change over time. Cryptokitties NFTs also made it possible to merge NFTs to create a new generation of NFTs.
Activating a new community of consumers with NFTs
Boosting the popularity of your brand necessarily involves tackling new communities. NFTs have the power to federate communities, to create them. A person having knowledge of NFTs power and familiar with Web3 will be more likely to turn to brands that offer collections or experiences through NFTs. This population of users will be more inclined to turn to a brand that is essential in the new generation of the Web: Web3.
The Gucci brand has thus used NFTs in its acquisition strategy to convert a new segment of leads, and offer its dematerialized products.
Preparing your content for the metaverses
Making NFTs also means preparing for the construction of new economic systems that are more digitally rooted. With the massive adoption of virtual reality headsets, the connection with the virtual universes will change. Making NFTs allows brands to establish themselves in metaverses, which will soon be an extension of real life. The metaverse is a unique way to interact with its consumers. The assimilation of NFTs in metaverses will change user habits in virtual spaces, but also multiply interactions between individuals, and between brands and their consumers.
To return to Gucci brand, it put up for sale in the metaverse game Roblox, a limited Gucci collection of bags, accessories, which would be used to dress the avatars integrated into the game. Coca-cola brand bet on Decentraland metaverse for the sale of its NFTs. There was also a project of selling virtual clothes for the avatars of the virtual universe, precisely.
NFTs are likely to prove essential in terms of strengthening the commitment and especially the users loyalty. Through loyalty programs based on the power of NFTs, a brand is able to engage its audience in its universe and push its brand awareness to the maximum. The brand that succeeds in bringing together the real world and the virtual world to consolidate the user experience will have won everything.