NFTs is the abbreviation for “non-fungible tokens.” NFTs are stored on the blockchain, which includes information such as who purchased it, how much they paid for it, and how much they sold it for. They’re non-fungible, which means the tokens can’t be swapped for each other. Since a good marketer keeps pace with the advances in trends across the globe, one must not overlook NFTs either.
Consider NFTs this way: if bitcoin tokens are equivalent to blockchain-verified dollar bills, then NFTs are equivalent to blockchain-verified artworks.
Non-fungible tokens have been around since at least June 2017, when CryptoPunks, a collection of 10,000 unique digital characters, emerged on Ethereum. However, CryptoKitties, a virtual cat trading game that went popular later that year, was the first initiative to make NFTs generally known among the crypto community. People have spent $174 million on NFTs since then.
Non-fungible tokens are similar to the serial numbers that a luxury brand might provide to each of its products in order to authenticate their authenticity. There is no central authority issuing NFTs. Instead, the majority of NFTs currently in circulation are based on Ethereum. And each NFT is minted to represent a specific piece of digital asset and is confirmed by the network.
NFTs in Digital Marketing
Non-fungible tokens provide brands with fascinating new digital marketing opportunities. Because NFTs are still in their infancy, the possibilities for incorporating them into a brand’s digital marketing plan are limitless.
Offering meaningful experiences to followers and consumers that go beyond your brand’s products or services is a crucial part of any smart marketing strategy. This is exactly what NFTs provide.
They’ll assist you in building communities and developing relationships that lead to loyalty and support, as well as increasing client lifetime value. While they may not provide an immediate return on investment, they can help to support all of the other activities aimed at increasing conversions and sales.
Some companies have used NFTs as part of their digital marketing plan to buy an existing popular NFT that promotes their brand on social media in the hopes of becoming viral and reaching new audiences.
Some of the other brands which have invested in NFTs in the past year include Coca Cola, McDonald’s, Nike et cetera.
Other brands, such as Taco Bell, have directly incorporated NFTs into their approach. Taco Bell started selling a limited edition of taco-themed digital art NFTs. All of this helped them raise brand awareness while also helping a good cause.
How to incorporate NFTs in your strategy?
Naturally, one of the goals of NFTs is to boost conversions and income. As the brand enters the NFT area and offers these new experiences to the community, interest in the brand organically grows. The methods listed below can help you adapt NFTs in a seamless and successful manner.
1. Build Brand Awareness
Anything digital can be used as an NFT: a JPEG, a GIF, a 3D animation, a VR artwork, and so on. Your company is no longer limited to selling actual goods or services. Offer something unique while yet using your brand’s most authentic elements. Make sure you’re selling something that your users will find worthwhile not only to invest in but also to spread the word about. NFTs can become a part of your brand storytelling, bringing it to life through a real object that customers can possess and that embodies their brand experience.
2. Expand Audience Reach
Afraid that your brand does not appeal to the younger crowd or the Gen-Z’s anymore? What better way to accumulate their attention than by jumping on the NFTs-bandwagon.
Open the door to user-generated content, community proposals for the types of tokens they’d like to see and possess or utilise them as prizes in crowdfunding campaigns and contests to appeal to them.
This will allow you to create your own community, one that will be diverse in terms of age groups. It will also cater to practically all segments of society who choose to participate in your campaign and provide feedback. As a result, ensure that your campaign is user-friendly and simple to navigate.
3. Build your image by supporting social causes
Consumers today place a high priority on whether brands reflect their values. You can show your brand’s commitment to social causes by donating NFT earnings to organisations. Choose a cause that reflects your values and connects to what you have to offer. Don’t do anything that feels forced or out of the blue.
Alternatively, you might ask artists to design tokens for your company and reward them with both publicity and cash from their work.
Risks involving NFTs
NFTs aren’t all rainbows and sunshine. NFTs are a risky yet lucrative investment. There are risks involved with incorporating these assets into a marketing campaign.
1. An NFT collection may not attract the community, exposure, or traction it needs to be successful, and hence will not yield a large return.
2. NFT’s success is primarily reliant on the community. Social media shares and word-of-mouth help to provide the necessary publicity and traction for a successful project. All of this is still plagued with high-volatility dangers.
3. A potential danger is having a target audience that does not overlap with the audience that follows NFTs. You may have visibility and a collectable item, but no KPIs to back up your marketing spend.
4. While there are efforts to make NFTs less energy-intensive, this is not the case right now. As a result, you may need to think about their environmental impact and look for solutions to offset some of the impacts. Also, given the high demand for tokens, new eco-friendly methods of producing tokens are likely to emerge shortly.
Brands now have access to a whole new marketing area thanks to NFTs. This allows them to come up with new and innovative methods to engage with their fans, boost brand exposure, and generate new revenue streams. Keep an eye out for brands leveraging NFTs to draw inspiration from.
We advocate implementing NFTs into your marketing if your brand can afford the risk, has overlapping consumers, and wants to try new digital marketing methods.
Contact us at Shaktiki today to learn more about new opportunities in digital marketing.