NFTs For Beginners | How to Leverage in Your Marketing Strategy
December 23, 2021
If there are two things that summarize NFTs best, it’s that they’ve exploded in global popularity over the last year, and, despite that, few people still really understand what they ultimately are. Regardless of your level of expertise regarding NFTs, the good news is that it’s easy to get up to speed on what you need to know. And, depending on the needs of your brand, you might be able to incorporate NFTs into your marketing strategy. Let’s begin with the basics.
What are NFTs?
The one thing most people know about NFTs is that the abbreviation NFT is short for “non-fungible token”. That’s about where the common ground ends.
But the actual concept of NFTs isn’t too hard to understand. In its simplest form, it’s the unique ownership of a digital asset. The ownership of this item is tied to blockchain, a digital ledger that provides indisputable evidence of who owns the item, when they bought it and how much they paid.
While most stories regarding NFTs center around the sale of items like gifs, tweets and inane images, NFTs actually represent a great opportunity for digital artists to get paid for their work. In that sense, NFTs are a great thing.
The part that gets complicated is wrapping one’s head around the idea of people paying large sums of money for digital media that’s available for free. After all, nobody is stopping anybody from screenshotting a piece of digital artwork for which there is an NFT.
However, the cryptocurrency market is booming right now, and NFTs are part of the crypto game. Buying a NFT now may end up being a very wise investment if the value of that NFT rises over time. In a sense, it’s like buying stock. It might not make you rich by itself, but it could be a very good investment in the long run.
What is the Future of NFTs?
Since NFTs have come out of nowhere to capture so much buzz and investment, it’s not entirely clear where the industry is headed. What is undeniable, though, is that the interest in NFTs isn’t going away — especially because businesses around the world are starting to explore the sales of NFTs relating to their own companies.
You probably saw ads for NFTs while doing your holiday shopping, and there’s a reason for that. Again, much of the NFT coverage in the media has focused on large sums, but businesses need to sell NFTs to the common man, woman and child and that’s what they’re now trying to do.
In 2022, you’ll see more accessible NFTs, ones that might not be as exciting as the very first NFTs, but ones that consumers might actually be able to afford and appreciate.
Because NFTs are becoming more mainstream, businesses are starting to figure out what does and doesn’t work. One of the best examples of NFTs is the NBA Top Shot marketplace, which sells NFTs of players, teams and moments.
Screenshot of nbatopshot.com, December 2021
These items come individually and in packs, much like trading cards. This encourages fans to buy because they get the thrill of seeing what they’ll get, and they may just come away with something valuable.
Of course, not every business has tens of thousands of hours worth of content to sell like the NBA does. But the applications for this type of NFT can be seen in almost any business. If your company has any name value with consumers, there’s a NFT you can sell.
What Are Potential Downsides to NFTs?
There are three main pitfalls to NFTs as they are now. The first is that there’s a non-zero chance that the entire bubble bursts and all the focus on NFTs becomes wasted time, not to mention the loss of value of all of these digital assets. But because crypto is so popular these days, and because businesses are just now starting to embrace NFTs, the chance of the industry going belly up is minimal.
The second problem relates to the environment. As is the case with all cryptocurrency, the blockchain that governs NFTs consumes a lot of energy. This might not seem like such a big deal right now, but who knows how things might look ten years from now? Embracing NFTs might also be an issue for businesses that emphasize the environment as one of their core values. Consumers will surely hold those companies accountable for preaching about environmental considerations while also attempting to profit off of energy-consuming NFTs.
The third issue with NFTs is getting started. Not only is seemingly every company launching its own NFTs, but there are also tons of NFT marketplaces out there right now. Which ones will become the major players in the future? It’s hard to say. Start with a major player like OpenSea, and keep an eye on the competition among other marketplaces. Over time, the landscape will become easier to navigate, and you can embrace the other marketplaces once they’ve proven they’re worth your time.
How Do I Leverage NFTs in My Marketing Strategy?
Now that you know what a NFT is and why the medium has some staying power, it’s time to apply the concept of NFTs to your business and your marketing. As always, the direct applications of NFTs to your overall strategy depends on your industry.
If you’re a magazine publisher, you have a tremendous opportunity in NFTs because you can sell art, images and articles that have appeared in your magazine. If you’re a convenience store, there’s not much you can do with NFTs without some serious name value.
The best place to start with NFTs? Look at the relationship between your brand and your most valuable customers.
What do those people appreciate about your business? What speaks most to them? What makes your company unique in the face of industry competition? When you understand your competitive advantages and know what people really value, it’s a lot easier to conceptualize NFTs in which people might be willing to invest.
With that in mind, here are some examples of what businesses are currently doing to sell NFTs to their most loyal customers.
- NBA Top Shot: As discussed earlier, the NBA’s NFT store has something for everyone. From all-time classic moments to everyday moments, there’s an option and a price point that lets anyone find something worth buying. Packs of moments sell people on the idea of investing more and becoming even bigger fans of the league.
- Nike CryptoKicks. Nike is well-known for its customization options, but it’s expanded its customer-first reach into NFTs as well. When customers buy CryptoKicks, they also receive a NFT of those very same sneakers. The NFT can be transferred if the owner sells the shoes. The odds of becoming a millionaire off a NFT of this nature are very long, but it’s a nice touch that immerses people even more deeply into the Nike brand.
- Charitable Initiatives. If your business doesn’t have a NFT idea that jumps out at you as an immediate moneymaker, that’s totally fine. You can still start small with NFTs by selling digital items and donating the proceeds from those sales to charity. It’s a way to gain goodwill with customers and get them interested in something they might not otherwise be too keen on buying. Procter & Gamble, a well-known brand whose product offerings don’t lend themselves well to NFTs, has had success with NFT-based charitable endeavors.
The coming months and years will see even more applications for NFTs and their marketing. Look at the branding of your business and think of ideas that might be sellable to your best customers. NFTs of logos, advertising materials, panoramic store images, commercials and digital videos are just a few ideas of items you can monetize through NFTs. If it matters to your audience, it’s something worth considering. Get creative and see what you can come up with!
NFTs might be a relatively new phenomenon, but in the fast-paced world of marketing—and in particular digital marketing—it’s our job to pay attention to what’s happening and what’s possible. Not to mention, they’re not going anywhere anytime soon. There’s no time like the present to see how your company might fare in the NFT marketplace. To learn more about how you can utilize NFTs in your marketing strategy, contact us at Commit Agency today.