NFTs have seen explosive growth, growing from $100 million in trades in 2020 to more than $20 billion in 2021. With the hype for cryptocurrencies, NFTs, and other blockchain technologies at a fever pitch, more brands have started turning to them as a potential source of engagement.
Turning NFTs into a good marketing strategy requires care and effort, though. Not all audiences understand how NFTs work and some outright oppose the practice. Many cities worry about environmental impacts or money laundering as a reason for their opposition.
If NFTs suit your audience, however, they can get a lot of engagement in short order. In areas like experiential marketing, NFTs can play an important secondary role. We’ll cover how NFTs can figure into any digital marketing plan, so read on for more.
What Are NFTs?
NFTs, also known as non-fungible tokens, use blockchain technology to prove ownership of an asset. Most NFTs serve as proof of ownership for digital assets in particular. You can’t own a .png file as easily as a physical canvas, so NFTs serve as a record of that instead.
Most NFTs use the Ethereum blockchain. Any blockchain could be used for an NFT. A company could even create its own blockchain, though part of the advantage of a blockchain program comes from user confidence.
While some NFT creators make their own code and write their own contracts, others choose to partner with major players already in the space. Organizations like OpenSea and VaynerMedia have welcomed corporate partners.
As with any partnership, do your research about an NFT creator or platform before committing. Studying up becomes even more important when a new technology has only just broken into the marketplace.
Experiential Marketing NFT Strategies
While NFTs serve as markers of ownership, some brands have started looking at more complex ways to produce and use them. Budweiser, for instance, used randomly generated NFTs to offer an event similar to a raffle. Some purchasers received video calls with music artists or an invitation to a Discord listening party.
Other brands have used digital media and NFTs to create online experiences. NFT collections that offer long-term access to specific online directories, events, or activities for the holders have started to take off.
Using gaming for marketing with NFTs may sound strange. Some companies have taken to it in earnest, though. The Gap, for instance, offered NFTs that could help users get a unique, limited edition hoodie.
Gamification encourages users to purchase more NFTs. These systems often take concepts from collectible card games, such as different rarities, and attach heightened value to rarer types of NFTs. While similar to lottery-style NFTs, gamification has some unique elements too.
NFTs and Exclusivity
If you already have a large audience, consider adding exclusive perks tied to NFTs as part of your digital marketing strategy. Customers holding NFTs could receive early access to certain items or special news updates.
Marketing requires building a solid relationship with customers. NFTs guarantee your customers have a stake in your company and what it’s doing.
Unusual NFT Styles
One of the benefits of NFTs is that they point at a location online, rather than being the item themselves. As a result, NFTs can get creative in what they offer. We’ll show you some unusual NFT offerings, with ideas for how you could use something similar in a marketing context.
One unusual NFT idea ties itself to the outcome of an event. People have used NFTs like these in the contexts of elections and sports games, auctioning them off before the event and then changing them. If something they own will change as a result of the event, they’ll invest more attention.
Some creators have taken to “burning” NFTs from a broader collection, destroying ones that don’t sell. This makes the surviving NFTs rarer, encouraging more attention for the duration during which they sell.
Why Skip Them?
Not every audience has embraced NFTs. As with any initiative, you need to consider the values and opinions of your customer base before thinking about how to use NFT marketing.
Gaming communities, for instance, have been split on how much to embrace the technology. Online communication and gaming platform Discord took a lot of backlash for flirting with the NFT boom in 2021. Some users will even take surveys about whether your company should use NFTs as a sign to get out sooner than later.
If you can, consider ways to learn about how your brand’s target demographic feels about NFTs without moving yourself. If your users already post a lot about cryptocurrency, they might expect you to move into NFTs. Many sports brands have already made the plunge, so if your target market hasn’t abandoned the NBA over it, they probably won’t abandon you either.
NFTs: Flash Forward or Flash In the Pan?
For some businesses, NFTs represent a new frontier in audience engagement and product sales. For others, NFTs just aren’t the right fit. Creative use of NFTs in experiential marketing and other marketing strategies can still help businesses take advantage of this new technology.
If your audience won’t bite your head off for it, try taking small steps first. Offer a small collection, or integrate NFTs as part of a mid-size event. Expand as your budget allows.
Looking for advice on the best ways to use your marketing dollar? Considering strategies for digital media, event marketing, or mobile marketing? Contact Auctus Agency and we’ll help you sort out your next best move.