NFTs – that’s non-fungible tokens for the uninitiated – have enjoyed a rise to prominence in recent times. And not just because of a certain million-dollar club of ape-related digital assets. Big-name brands started to take the leap into NFTs including Adidas, Nike, Clinique and even more recently the Australian Open!
So, what are NFTs?
Non-fungible tokens that can take many forms including images, video, text, music, property, or experiences. Basically, they are a unique digital asset, linked to the blockchain and, when attached to a tangible utility or benefit, can provide real value to your customers while boosting your revenue and brand loyalty.
How are NFTs bought and sold?
NFTs are primarily bought and sold on a platform called Open Sea using cryptocurrency. The cryptos involved in buying and selling NFTs are solid companies such as Etheruem and Polygon. Using blockchain tech means that everything is stored in cryptography, making it very secure when used and set up correctly.
How do NFTs increase in value?
The value of NFTs comes in several ways. Firstly, being a unique asset linked to the blockchain means that the rarity and uniqueness of the NFT can be proven through the blockchain technology. In these early days of NFTs, the popularity of collections such as Bored Ape Yacht Club or CryptoPunks came down to public sentiment. As hype built up, big-name investors and celebrities bought into the limited-number collections, which in turn built their value and ownership status.
As NFTs become more mainstream it is more challenging to build hype for an NFT collection that exists simply as art. NFTs that will continue to have and hold the most value are those with utility. For example, an NFT that unlocks access to free products, exclusive events, charitable donations, unique brand experiences and member benefits will have more value and desirability than an NFT that is simply a pretty image that is good to look at.
How can my brand benefit from launching an NFT collection?
Along with being at the cutting-edge of digital transformation and the transition to Web 3.0, there are many ways brands can benefit:
- Attract new customers
- Grow brand awareness
- Establish brand loyalty and an engaged, passionate community
- Create a new revenue stream
- Increase engagement with your audience
- Build brand authority in the new digital world
- Own your space before competitors move in.
Why would anyone benefit from buying my brand's NFT?
Think of NFT collections like a loyalty program. Establish a strong, solid program of exclusive member benefits for NFT holders and you’ll draw the crowd in. Remember, the prices of cryptocurrency (particularly Etheruem and Polygon) continue to increase over time. So, the longer people own your NFT, the more valuable they become (so long as you are delivering a strong and memorable brand experience!).
Can holders resell their NFTs?
Yes. Using sites like Open Sea, holders can resell their NFT to others via an auction or by setting a fixed price. The price will be determined by the demand and the cost of the cryptocurrency at the time. The more desirable your brand’s NFT is, the more demand there will be among buyers. When creating NFTs, you can determine whether you are paid royalty fees for every resale of your NFT, essentially establishing a passive income stream.
How do I go about launching an NFT collection?
We know this is a seemingly strange new digital world and we are here to help you throughout the entire process. There are five key steps to launching a successful NFT strategy:
- Identify the right audience
- Determine your best NFT offering (utility)
- Decide upon the best channels to communicate with your audience
- Create content for every step of journey
- Deliver the best utility possible!
Don’t deal in cryptocurrency just yet? Not a problem – we can manage the setup of everything for you, or, we can provide training to the appropriate team members so it will be a breeze!
Learning about Web 3.0, Blockchain, the metaverse, NFTs and cryptocurrency can feel like learning a whole new language. We’re here to decode it all for you! Why not start by booking in a training session for you and your team? We can fully customise your training to ensure you get the most relevant information based on your business needs.