NFT have been making the headlines in recent weeks but what does this new acronym actually mean?
An NFT is a non-fungible token. Still don’t get it? Well in “English” it means a unit of data stored on a digital ledger, called a blockchain, that certifies a digital asset to be unique and therefore not interchangeable. Ok fine. But how can NFTs be used in Marketing?
In the beginning there were kittens… and whatever happened to marketing?
NFT were first used for a game called CryptoKitties. With NFTs, players could trade and sell virtual kittens. The most expensive one sold for $170,000.
Naturally, NFTs continued their relentless ascent to popularity and, like a psychedelic drug, worked wonders on people’s imagination: Jack Dorsey’s first tweet, the founder of Twitter, CriptoKicks from Nike, Babskyn’s work, the dunk of your favorite NBA player or team, recent newcomers to EBAY… Rest assured though, the junk food industry is also in on it: Taco Bell’s virtual tacos, pixelated portions from Pizza Hut, McDonald’s digitized flagship products…
Some of the amounts invested are also quite staggering. A digital piece of art by Beeple, a complete unknown, sold for $69 million. This outrageous amount underscores how powerful ideas and concepts could be. It is no longer a piece of art that you decide to purchase but an idea. Finding ideas, concepts, isn’t that what Marketing is all about?
Just like a predator, marketing has a knack for trying to take over all kinds of areas, constantly seeking to break new ground and gain market share… Just like a scorpion, unable to hold back from stinging, marketing can’t help but take over all the areas that can be used as a communicating platform. Once marketing has found its new playground, it then sets up all the rest: scope, structure, development path, within both an offensive and defensive strategy. Should it address the still untapped NFT market? If so, rather be safe than sorry and learn more about NFTs before starting out.
Consequences related to NFTS that touch on marketing’s 4ES
Digital technology has transformed mass production and copying by standardizing replicating processes, behaviors and so on…
The digital world has thus obliterated one of the basic representations of the hierarchy of the world: originals and copies. Because originals have now become something of the past, there begs the question of how to recreate originals? And what if NFTs are the answer to this problem? Paradoxically, while they are based on digital technology, they reintroduce uniqueness by giving a singular character to objects that can be mass-produced. In short, NFTs imbue uniqueness, and so we are looking at analog technology, into a world that is increasingly going digital. The NFTs would therefore be one of the symptoms of this willingness to re-establish a hierarchy. It is sort of a bit like a revolution that aims to reintroduce nobility.
Because the consumer of the 21st century wants to be « unique », and that shopping is becoming a much more personalized experience, brands have to be very competitive and stand out in terms of originality and uniqueness. This calls for hyper-personalization of products. Digital technology allows the customer to personalize the products they want to purchase whatever his budget: they can personalize the product in terms of color, shape, size, pattern, ingredient, pieces…It is satisfaction to the fullest degree with a sense of feeling unique and special as a customer. This longing for that sense of uniqueness is reminiscent of the 4Es of marketing: Emotion, Experience, Exclusiveness, Engagement.
In the future, thanks to NFTs, Customer Experience will be brought to new heights by providing the customer with the assurance that they are the exclusive owner of a given product. And this will have demonstrated that the brand has delivered on its promise: that of delivering a product that perfectly caters to the expectations of customers.
Precision or illusion?
Because companies have both tangible and intangible assets, marketers are heeding the call of NFTs and will be able to run a kind of inventory of the assets they could potentially leverage for mining. Furthermore, marketers will be able to explore other avenues and areas they can secure for communication purposes. However, we must be careful about potential cases of misuse.
NFTs are indeed making various breakthroughs in the physical world. One of them is Oleksandra Oliynykova, a professional tennis player, who put up a part of her body for auction. The owner of the NFT will be able to affix the message of their choice on the arm of the player, more precisely on an area of 15 centimeters by 8, located above the elbow. Very tempting for an ever more ambitious marketing approach, but a bit risky in terms of ethics and potential cases of misuse.
Brands committed to CSR will also have to consider the environmental impact of NFTs. The latter, like Bitcoin, mostly use the Ethereum network, a « first generation » blockchain network. It is therefore energy-intensive. By way of comparison, the electricity consumption needed to run these mining processes is equivalent to that of a country like Argentina or New Zealand every year. Probably enough to enrage Greta Thunberg or a loyal fan…
Just like a SWOT analysis, NFTs also come with opportunities and threats for marketers. However, although no one can really tell for sure if this technology is the next big thing in communication or whether it is just a fad, it is still worth looking into. After all, as the saying goes, Curiosity Killed the Cat, but isn’t being curious the essence of what great and renewed Marketing is all about?
(The opinion pieces published reflect the author’s opinion and do not necessarily represent the views of CB News).
Article initially published in CB News.