If you’ve been on the Internet in the past few days, you’ve most likely heard of a topic that has been making the buzz lately: non-fungible tokens (or tokens), better known by the acronym NFT …
Some recent examples which show the growing scale of the phenomenon and its dissemination to well-known personalities or institutions:
- Lindsay Lohan and YouTuber Logan Paul both created some sort of NFT-based digital collectible;
- Post Malone has teamed up with a startup called Fyooz to launch a celebrity beerpong league using NFTs
- The first work of art in NFT format has just been put up for sale by the auction house Christie’s, whose reputation is well established
A little more wacky projects have also emerged:
In this case, the NFT is a whiteboard, of the kind widely used in businesses, but the interactive and innovative side of this NFT lies in its fully customizable and modular aspect.
This opens up a whole new horizon in the world of NFT, where the personalization and customization of the works offered for sale allow innovative and almost limitless possibilities.
And the applications, both in marketing and personnel, are immense.
- In the same vein, tenniswoman OleksandraOliynykova has put his arm up for sale as an NFT and offers to “personalize” it with tattoos of their choice for a certain fee.
Very similar to the previous example, this one also offers the possibility of new advertising media for advertisers, and thus makes it possible to renew business models in the advertising industry.
But concretely, what is an NFT? How do these work?
And how to explain their sudden diffusion in our lives?
Beyond the hype and investment frenzy that seems to take hold of these new mediums, is there anything about NFT that can be useful for long-term brand marketing?
Let us first see what the NFTs represent in concrete terms.
Non-fungible tokens (or NFTs) are a special type of cryptographic token that represents a unique digital asset. It is based on blockchain technology and works similarly to bitcoin (like all other cryptocurrencies by the way), with networked computers competing against each other to solve complex mathematical functions in order to encrypt a set of data. .
To help you represent this, you can think of it this way: if bitcoin tokens are like Bank notes verified by the blockchain, then the NFTs are comparable to works of art verified by the blockchain.
In “physical” life, no one cares to know that twenty euro banknote he has, since all twenty euro banknotes have the same value and are therefore interchangeable. On the other hand, we care much more about what work of art we own, since different works of art have a value that can vary drastically, if not extreme, in both financial and artistic value.
For brand marketers, the rise of NFTs offers exciting new possibilities in digital products, digital media distribution and access management.
Let’s see in more detail how:
Create scarcity and value for digital goods
Digital goods have been around for quite some time and are particularly popular in the video game world. Yet these digital goods have not been viewed as carrying much value by collectors, and for a very simple reason.
Until now they were easily copied.
In a digital world of abundance, where copies are easily created and distributed, NFTs make it possible to create a digital scarcity.
To date, most NFTs are related to collectibles like digital art as well as virtual goods in video games, but they could extend to other digital assets.
Real estate, event ticketing and even brand licensing are all possible use cases that are currently under study.
In this sense, it is important that brands start to think about digital ownership and how to take advantage of NFTs to produce limited editions of products and thus generate buzz.
Unlock new monetization models for digital media
Another potentially revolutionary aspect of NFTs is that they could revolutionize the way digital media is distributed and monetized.
Currently, most digital content is monetized through platforms.
These platforms act as intermediaries between content creators and consumers, and they remunerate themselves as distributors. Although the creators still own the copyright in their work, they give up some of their ownership and control over that work to the owners of the platform.
Exploring this new model of digital media ownership and monetization distribution opens up an interesting avenue for the future of digital marketing. Today, the value of a digital good is measured not only by the number of copies sold, but also by the number of memes that he inspired. Part of the value of digital assets indeed comes from the fact that they are easily remixable.
For example, the value of a particular TikTok video is not only measured by the number of views it collects, but also the number of copied versions it has inspired, each slightly different from the original, as people there. brought their personal touch.
More these versions memes appear, the more popularity and value the original version gains.
This long-tail collaborative creation is good for user-generated content, but it tends to scare off brands, who are understandably more concerned with not having their brand assets changed as they are released.
What NFTs bring then is the ability to make branded digital assets both remixable and non-fungible. It may sound counterintuitive, but NFTs help verify that brands are the rightful owners of their digital assets and therefore demystify other copies of those assets by passing them off as fan-made content.
They thus allow brands to retain full control of their digital assets without limiting their distribution or fear that a maliciously modified version, for example using profound forgery technologies, will be wrongly attributed to the brands. Ownership comes with responsibility, and NFTs allow brands to be responsible only for the original content they deliver without sacrificing the viral potential of that content.
“Tokenize” access to services and experiences
Beyond the encryption of digital assets and media, another emerging use case for NFTs is authenticating access to digital experiences.
Earlier this week, Microsoft released a game that celebrates women in science and rewards players with NFTs that unlock secret games in Minecraft.
For brands, this example shows that NFTs open up a new way of looking at access management. In general, digital tickets are easily transferable and interchangeable, as they all perform the same unique function of authenticating access to exclusive experiences and events, online and offline.
What NFTs add to the equation is that they make each ticket on its own, beyond its functional value, much like a celebrity autographed ticket stub would be.
Therefore, access itself becomes a symbolic value and a commodity, free to be bought and sold without the need of a third party as an intermediary.
The future of NFTs
As NFTs continue to gain the interest of the general public, we expect more brands to embark on the adventure and start experimenting with editing digital collectibles based on ownership. intellectual property in order to generate additional income and engage with their fan base.
Or by creating exclusive experiences with symbolic access that could become sought after collector’s items, thus strengthening the profile of said experiences.
New business models will likely be tested for digital media creators, to help them bypass platforms and directly monetize their content to their audiences.
Of course, NFTs will not be enough to bring digital collectibles to the general public; there are still many questions to be answered on how to transfer them to digital platforms, as well as how to measure and offset the huge carbon footprint they generate, and finally how to properly expose them in virtual environments as well as in the real world.
But the potential is there, and it is immense.