How Non-Crypto Brands Are Using NFTs for Brand Marketing

The NFT craze is catching up with every industry like a storm. In less than a year, the value of the NFT industry has skyrocketed from $340 Million to a whopping $41 billion. Such a leap in value can be attributed to the high level of user adoption, trading volumes, and a budding community.

If that’s not enough, the search volume for NFTs on Google has increased significantly since the NFT bubble. And guess what? It’s not stopping soon. Because recently, we’re beginning to see an influx of big brands, celebrities, and government institutions into the NFT industry.

Before we proceed, let’s understand the meaning of NFTs.

Non-Fungible Tokens (NFTs) are the record of ownership of a digital asset. Non-fungible means something isn’t interchangeable, which can only be traded. Examples of such digital assets are a piece of artwork, a plot of land, video, and audio clips.

The initial concern of most people is why one would pay hugely for ordinary Jpeg files or audio clip that easily be downloaded from the web. Well, the ownership of every NFT is recorded on Blockchain with the aid of smart contracts. That means, even though you download an NFT, you cannot sell it as NFT because it has been registered on the Blockchain with the original creator’s name.

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Here’s where it gets interesting. The creator of an NFT automatically receives a royalty when their work is resold on any exchange, increasing their earning capability with a single piece of work. To go deeper on NFTs, check out this guide.

Now we know what an NFT is, let’s explore the ways brands can get involved in the industry.

Non-crypto brands can take advantage of the NFT bubble for brand marketing in two primary ways.

1. As a Buyer
2. As a Creator

1. As a Buyer

Brands can take advantage of the NFT craze for brand marketing by buying an NFT. In doing this, brands should look for great NFT collections that align with their core message and values. Or NFT artists that they want to support.

One of the main benefits of buying an NFT as a brand is that the ROI is incredible. Unlike brand marketing, where you pay for advert placement and write off the fund as an expense, you can still retain the NFT on your general ledger as an asset because it appreciates value overtime. NFTs appreciate overtime according to supply and demand.

Asides from that, buying an NFT shows that you identify with your customers. It also reinforces your sensitivity to your customers and supports their craft. In turn, they’ll reciprocate with loyalty and recommendations of your brand. Let’s see a few case studies.

On 23 August 2021, Visa bought a CryptoPunk NFT for 49.5 ETH, approximately $150,000. It’s worth noting that CryptoPunks is one of the most-valued NFT collections with a market capitalization of over $13M.

In a blog post shared on VISA’s website, the company’s head of crypto said and I quote:

We think NFTs will play an important role in the future of retail, social media, entertainment, and commerce. To help our clients and partners participate, we need a firsthand understanding of the infrastructure requirements for a global brand to purchase, store, and leverage an NFT.

Having worked with Anchorage Digital to complete this process, we’re better positioned to help our partners navigate the process. We also wanted to signal our support for the creators, collectors, and artists driving the future of NFT-commerce.

Here’s the catch, this tweet from VisaNews announcing their NFT got more engagement and retweets than their previous tweets. Not just that, the announcement was picked by most major news publications and blogs — giving Visa broader exposure and brand recognition. All of which they achieved while still maintaining the NFT on their ledger.

Our second example is from one of the world’s leading sportswear brands — Adidas. They recently bought a Bored Ape Yacht Club (#8774) for 46 ETH, approximately $156,000. The Bored Ape collection is a collection of 10,000 unique NFTs living on the Ethereum blockchain. They’re among the most-valued NFT collections in the market.

To put it plainly — the purchase is a move to register their presence in the Metaverse space. And be a trendy brand for a while like their counterparts are doing. To a large extent, they achieved it because the news of their purchase was captured on top news publications and blogs. Also, the tweet got tons of organic retweets and impressions.

2. As a Creator

Another way a brand can take advantage of the NFT boom for brand marketing is by being a creator. Yep, you heard right. There are three main parties involved in the NFT industry — the exchange (platform), the creator, and the buyer. No party is superior to another. Like a system, they all have their roles in facilitating transactions in the industry.

By being a creator, brands will create their own NFTs. The NFTs can either be made for sales purposes or utility purposes. Let me break it down. Brands can develop NFT collections and list them on exchanges like Opensea for sales purposes. Alternatively, they can create it for utility purposes such as event access, discount badges, community partner, etc.

Let’s see a case study.

Lamborghini partnered with artist Fabian Oefner in creating a historic five-art NFT piece. It’s their debut in the NFT industry. Hence they took due diligence in ensuring that the NFT was worth it. This NFT is accompanied by a space key, through which the buyer can access the piece by scanning a QR Code.

Here’s the specification of their NFT according to their website correspondence.

What may look like a computer-generated image is in fact entirely created from elements of the real world: The artist captured more than 1500 individual parts of an actual car. The photograph of the earth`s curvature was made by sending a weather balloon equipped with a camera to the edge of the stratosphere.

The artist then carefully assembled all of these images into an artificial moment in time. Each piece has more than 600 Million pixels. As one starts to zoom in, the hidden details of the hyperrealistic photograph are revealed.

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The NFT was currently auctioned via their official website and has received several bids already. This is a classic example of a brand getting involved in NFT as a creator. Other brands can leverage the creator approach in creating NFTs that reflects their brand values. And through which they can generate revenue.

Several other brands have also started experimenting on their NFTs and use cases. My prediction: by the end of 2022, we’ll see more non-crypto brands creating their NFTs and pioneering more ways of utilizing NFTs for brand promotion and increased sales.

5 Tips for Brands That Are Considering NFTs

1. Don’t rush — take time to understand NFTs & Web 3.0
2. Support projects that align with your brand values — just because a project is popular doesn’t mean you should buy from them.
3. If you can’t create an NFT, outsource — conduct a SWOT analysis to access your organizational capabilities. Outsource to the best if you can’t create.
4. Community-first approach — In the world of NFTs community is king. If you don’t have a sizeable audience, build one before launching your NFT.
5. Collaborate with other brands — In this game it’s collaboration over competition. There’s no need competing when we can all win.

In Summary

Anuj Jasani said, and I quote, “If you want to invest in something today in 2022, start investing in NFTs, Crypto, Metaverse, and Domains, this is a hidden treasure and is going to go mainstream soon”. The best part is, with the way NFTs are going, it’s a matter of months before NFTs hit mainstream.

Now is the best time to position your brand. Not tomorrow. Today. Start by understanding the NFT industry, and how it can help amplify your brand marketing efforts before pouring in funds.

I’ll keep updating this post with case studies of brands experimenting with NFTs, follow me to stay updated.