Over the course of the past year, one of the most remarkable developments within the digital asset space has been the proliferation of non-fungible tokens (NFT). An NFT is a unique digital asset, whose ownership is tracked on a digital ledger. Within any given day, NFT trading accounts for more than $50 million in trading activity, including a record-setting daily trading volume of $350 million, which occurred on August 27.
NFTs, without a doubt, have been generating a lot of buzz. But this asset class includes so much more than novelty memes, digital images, and other tradeable assets—it represents an opportunity for brands around the world to grow and increase engagement with their audience.
In a very short amount of time, the NFT marketplace has gone from being a sort-of unknown realm of possibility to something that now plays a crucial role in many of the world’s biggest brands’ day-to-day operations—comparable to what we have witnessed over the course of the past decade with cryptocurrencies and even the decade before that with social media.
Brands that don’t begin taking advantage of this growing digital asset will soon fall behind their competitors. As was discussed in a recent “NFT Now” podcast, featuring VaynerNFT President Avery Akkineni, there are many big brands that have begun harvesting excitement about NFTs but aren’t quite sure about the best way to begin exploring this ever-changing field.
Some brands are hesitant to begin utilizing NFTs because, due to the fact they have very little familiarity with them, there is a perceived degree of risk. But in reality, the bigger risk is choosing to not begin developing an NFT-based marketing strategy and losing an opportunity to become an industry pioneer.
The NFT Marketplace: Combining Creativity and Expertise
A quick review of Google Trends reveals that public interest in NFTs has absolutely skyrocketed over the course of the past year. As a new asset class, people—including ordinary, brand-facing consumers—have a strong interest in NFTs and, as reflected by the market, are also willing to make some serious financial commitments.
Big brands know this. Big brands want to take advantage of these new opportunities, just as they would with any other opportunity of such magnitude. Only some, however, have invested in the expertise and resources needed to be successful.
Companies such as Sasco Digital Assets (SDA), among others, have begun fulfilling this natural need for NFT and digital asset expertise, along with supporting services (such as custody solutions). These companies make it possible for brands to identify NFT marketing strategies that are both profitable and feasible, securely execute their plans, and continue generating value for their consumers over time. It is no longer necessary to invest in an in-house NFT and Digital Asset department because the support is readily available.
Of course, the potential value of NFTs isn’t just something that exists in theory—it’s something that has already helped dozens of major brands reach new heights.
NFT Marketing Success Stories
“If you had to pat someone on the back for pushing NFTs into the mainstream, it’s the NBA (National Basketball Association)”, claims MethodShop in a recent article. Through the NBA’s “Top Shot” website—a platform where people can purchase NFT video highlights of their favorite basketball players—the NBA was able to successfully cultivate $250 million dollars (including royalties) across more than 100,000 different buyers. Certainly not a small chunk of change.
Some people invest in these NFTs because they (rightfully) believe they are destined to increase in value. Others invest because they sincerely love their favorite players and want to have the exclusive right to be the owner of their favorite dunk, steal, or three-point shot.
The NBA’s success with NFTs doesn’t stop there—the league has also made a considerable amount of money with NFT trading cards. Other sporting leagues across the US (and elsewhere around the world) have taken note of the NBA’s success and have begun developing comparable strategies of their own.
The NBA is hardly the only major NFT success story. Christie’s Art Auction House—the most prestigious art auction house in the United States—has also begun treating NFTs as a form of digital art that can be bought and sold just as easily as their physical counterparts. Gucci, Coca-Cola, Asics, and other large brands have also generated significant profits and engagements through their innovative use of NFTs.
A New Frontier
NFTs have only been a “mainstream” digital asset for about a year, meaning there is not always a complete and perfect playbook available for brands to use. Being willing to take chances and be creative will be absolutely paramount. But with a supportive team of NFT experts, dedication to their clients, and a willingness to explore this new digital frontier, brands across the world can benefit tremendously from these remarkably dynamic digital assets.