How collectibles-backed NFTs help brands
Building customer relationships is critical for any brand, and this new breed of NFTs is a potent way to reach out, says Ben Plomion, Marketing Manager at Dibbs.
Branded NFTs (non-fungible tokens) have gone mainstream. Fashion moguls, streaming platforms and other various industries are now using blockchain technology to acquire valuable customers. Still, in a rush to launch NFTs, companies should remember that they’re not just selling tokens – they’re selling a brand relationship.
It is a simple business reality that loyal customers shop more often and spend more per transaction than those who are just passing through. NFTs are no different; you will do well in cultivating loyal customers who want to buy more tokens from a given drop because they will be more likely to buy from you again when the next drop comes. Unfortunately, the time-limited nature and niche appeal of many NFT collections can make it difficult to strike that balance.
The good news is that brands are finding new ways to use collectible-backed NFTs — tokens that represent the value of real-world, highly sought-after assets — to build customer relationships that make the most of the medium. Here are some examples of what I mean:
Adidas
As a business model, collectible-backed NFTs are quite simple – token holders choose whether to redeem a physical item or exchange it for a more valuable NFT. Adidas, however, embraces this model with one extra step: the ability to use the digital asset directly. Adidas NFTs come with “Virtual Gear” branding to be worn within the metaverse. Token holders can use these wearables for virtual avatars across various interoperable platforms, creating personalized looks with Adidas-branded content.
But that’s not to say Adidas is taking its virtual gear away from physical goods – customers can also redeem their NFTs for exclusive products, including a Money cap, a Hash hoodie and an Indigo Hertz tracksuit. This model reinforces brand connections by encouraging customers to acquire their favorite clothes in all formats. It’s all part of Adidas’ strategy to tap into multiple collectibles markets and expand the brand’s visibility across the real world and the metaverse in equal measure.
See more: NFTs are changing the face of luxury brand marketing
Fan zone
Fanzone is a fascinating case study in sports NFT brands. Although it offers physical collectibles and merchandise, these items are not the primary selling point of the platform. Instead, the company is all about growing its community powered by NFT trading.
The Fanzone Sports Club project offers drops that can act as membership cards, which can be sold or traded on NFT marketplaces. Each pass provides different benefits, such as goods or game tickets, depending on symbol rarity. But the most consistent selling point is community access, including invites to real-world events, access to a private Discord channel, and digital fan experiences. Token holders may join to learn more about their favorite athletes, but ultimately stay because they become part of a community of like-minded fans.
The gap
The Gap’s first NFT offering took inspiration from video games with a series of limited-edition artworks divided into several levels. Regular NFT drops were available at the most accessible price point, but could be traded for the more expensive rare and epic tokens. Once the initial phase was complete, Epic NFTs increased the chance to win exclusive digital art and a hoodie designed by Frank Ape creator Brandon Sines.
On top of that competition, Gap’s recent Logo Remix campaign allows customers to purchase NFTs that correspond to a variety of community-designed creations. Initial holders of the NFTs can redeem tokens for real-world hoodies and corresponding AR filters, or they can hold on to the token to keep their collection online. This approach broadens the appeal of The Gap’s real-world goods while leveraging the gamified, community-building capabilities of NFTs.
Nike
Nike is well known in the collector markets for its highly sought after collectible shoes, some of which have gone for seven figures on the resale market. RKTFT created the same dynamic in the metaverse by using NFTs to represent digital shoe designs. So it was no surprise when Nike bought RKTFT in 2021 – but the shoemaker wasn’t just interested in taking on a digital market. Instead, it wanted a way to enrich relationships with both sets of customers.
Five months after the RKTFT acquisition, Nike applied for a number of trademarks linked to an independent online community. These filings include cryptocurrency wallet software, a marketplace for digital assets, electronic message boards, online hunts, and other features that may resonate with long-term fans. A new customer enters this ecosystem after purchasing an NFT or shoe collectors will quickly find more reasons to stay connected, even if only for the prospect of additional crypto rewards – effectively bridging the potential gap between those who prefer real shoe collections and enthusiastic NFT users.
Earning brand loyalty is far more complicated than simply selling a collectible-backed NFT to customers. And yet, Adidas, Fanzone, Gap and Nike found unique approaches to deepen their relationships with target audiences. If brand marketers use these strategies as potential frameworks for their own projects, they won’t just sell NFTs—they’ll build thriving brand communities.
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