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How is NFT marketing changing the advertising industry?

Boopathi Krishnan
How is NFT marketing changing the advertising industry?

With Facebook’s rebranding as Meta, the concept of the metaverse has gained a lot of attention. From web1.0 to web2.0, we can see a new model of brand economy: through the mechanism of accurate push of big data, spread advertisements in various network media, and then insert products through online fragmented information, use KOL software Sexual implantation to sell products, “Internet celebrity brand” is the iconic product of web2.0.

In web 2.0, major Internet brands have control, such as Douyin, Xiaohongshu, Weibo, etc. They build amusement parks and set the rules of the game. Anyone who wants to enter the game has to play by their rules or be kicked out, and they are also the biggest beneficiaries.

web3.0 belongs to the era of creators, each work is given a special number, unique, and all data is stored on the blockchain.

In this wave of digitalization, the development of the metaverse is bound to bring a new wave of shocks to the advertising industry.

Here I have to mention NFT. First, let me briefly introduce to you what NFT is?

The full name of NFT is Non-fungible token Development, which is a “non-fungible token” based on the Ethereum blockchain.

But the biggest feature of NFT is their uniqueness, “non-homogenization”, which is simply a “digital collection”, which is uniquely identified using blockchain technology, and each digital collection has a unique on-chain serial number , and establish a unique mapping relationship with specific works, artworks and commodities, which can be used as the only proof of rights.

Digital collections are fundamentally different from equivalent tokens such as virtual goods, and do not have any monetary attributes.

This scarcity and unique characteristics are in line with the consumer psychology and consumer behavior of the people in the new era. After the scarcity is superimposed on the brand value, the premium space of NFT works has skyrocketed, and it is even out of control. It is reported that a limited sale of the original price of 9 yuan 9 Dunhuang Feitian NFT payment code skins on Alipay’s “Ant Chain Fan Granule” applet has been hyped to 700,000–1.5 million on Xianyu, a full 70,000 times-15 Ten thousand times more.

NFT makes it possible for the value attribution, property rights confirmation, and virtual identity authentication of various digital items in the metaverse. Therefore, NFT will be the basic hub of future metaverse economic activities. Some people liken NFT to the opening of the metaverse world. tickets.

“Hot” NFT

In the third quarter of 2021, the number of NFT buyers was about 260,000, while in the same period in 2020, there were only 19,000. At the same time, according to a CNBC survey, more than 10% of American adults own cryptocurrencies.

According to data from Chainalysis, the current market size of NFT has ballooned to $44 billion, making it one of the hottest areas in the crypto market.

In fact, NFTs have already become a mess, and they have shown their talents in the market.

NFT marketing changing the advertising industry

From no one to be known to everyone, and even to be selected as the 2021 word of the year by the Collins Dictionary, according to statistics, in the year of 2021, the use of the term NFT has increased by 110,000%.

In March 2021, artist Beeple’s encrypted art work “Everydays: The First 5000 Days” sold for a sky-high $69.35 million at the traditional auction house Christie’s.

Blockchain technology has realized the mapping of currency in the virtual world, resulting in the birth of a large number of homogeneous currencies, thus setting off a wave of digital currency investment.

As a non-fungible currency, NFT allows everyone to see the possibility of projecting virtual time into the real world.

NFT may change the advertising distribution model, change the management method of the membership system, and change the core user reach and incentive tools.

NFT becomes a new model of brand marketing

Major brands have seen the future development of NFTs and have begun to make arrangements in advance.

Four months ago, the Coca-Cola brand and digital wearable device design platform Tafi jointly launched NFT digital collections.

NFT: Eternal Brand Equity

What is the biggest difference between NFT marketing and digital marketing?

NFT is eternal. No matter what kind of digital marketing or digital advertising, the link between brands and users is short-lived. Under the new round of brand bombing, the balance of memory will also shift, and no brand can be spared. In order to maintain a good relationship with users continuously and for a long time, it is necessary to continuously achieve remarkable results in market competition in order to seize the minds of consumers.

As a digital collection, NFT is eternal, it will not disappear with the flow of time, nor will it change. Users will think of the brand once when they see it, and this memory association will be accompanied by the number of times they are seen. Deepen and link the relationship between brands and people.

There may even be a situation where a certain NFT is passed on to the next generation of children. In this iterative replacement, the brand has completed its strongest mission and has a loyal brand guardian. At this time, it is not the simple relationship between brands and people, but the complex emotions between people, making them the “guardians” of the brand. This is not empty talk, but can be concrete after the rise of NFT. realized.

It is like the vintage in the current luxury goods, that is, second-hand goods. The older it is, the more popular it is, and its value increases over time.

Break through the real and virtual barriers and create a brand metaverse

Why is it called a digital “collection”, because of the scarcity of NFT and the fact that consumers have all rights and interests in NFT, including the right to dispose of the collection, at this time, NFT appears as a collection, not a consumable. At this time, the identity of consumers has quietly changed into collectors or sellers, and the brand’s NFT as “currency” has changed hands among different people, and the brand’s network has begun to cover the crowd.

In the world of the metaverse, any virtual item can become an NFT. In recent years, movies have also begun to show the prototype of the metaverse. The virtual world built in “Ready Player One” is actually possible in the future. In the future virtual world, brands will build their own brand user groups by continuously issuing NFTs, creating A metaverse of brands, deep links to their users.

The brand will eventually break through the online and offline barriers, integrate the real world with the virtual world, form its own digital assets in the continuous release of NFT, and finally build a sub-universe of the brand to form a closed loop.

From brand to IP, future marketing trends

Going back to the present, digital collections/NFTs can be used for both marketing and brand culture building.

NFT is committed to the track of cultural construction. NFT moves from investment to consumption, and from control panel to community.

On March 29, 2022, in the ranking of NFT projects on opensea, World of Women ranked 7th, and its derived secondary project World of Women Galaxy ranked first.

The first female-themed project World of Women (WoW for short). The excellent community organization has driven the overall female market. Women’s organizational and supportive power has been greatly released.

On March 26, 2022, the project launched a second-level NFT collection called “World of Women Galaxy”, which generated approximately $79 million worth of sales within 24 hours of launch. And in addition to secondary projects, they are still working on 3D projects, game development, film and television drama development, etc., and quickly become a phenomenon-level IP.

On the one hand, it deepens the relationship with consumers and employees through digital collections; on the other hand, it converts brand value into digital assets and builds a brand metaverse.

LOS ANGELES, Sept. 17, 2021 PR Newswire: Advanced NFT agency ENVOY Network announced today that their first NFT “Decentraboard” will be showcased on a giant digital billboard in New York’s iconic Times Square.

Located at the intersection of 1500 Broadway and 43 West Street in Manhattan, the billboard will be available from 6–2 a.m. Sept. 16–18, featuring 30-second commercials, each displayed on a large, eye-catching screen Reincarnation play, at least 300 times a day.

The show will offer 304 unique opportunities to showcase artwork or a brand’s live digital billboards in Times Square, with the first batch of initial NFT releases sold out within 2 hours and the second batch sold out in just 60 minutes.

Verasity founder and CEO Mark Hain said in an interview last year: In 2019, global (outside China) digital advertising spending was $325 billion, and it is expected to reach $389 billion in 2021. Ad spending will exceed $525 billion by 2024. $525 billion is the target market.

It can be seen that when the NFT Development trend is good, digital advertising is actually rising. The development of NFT is not an impact on digital advertising, but instead accelerates the digitalization process of advertising and promotes the development and update of advertising. But it is a heavy blow to Internet advertising based on web2.0.

Both at home and abroad are controlled, what is the future of NFT marketing?

The feasibility of NFT marketing has been demonstrated, but for its market, domestic and foreign policies are not conducive to its development.

United States: easy money laundering, difficult to collect taxes

In fact, as early as October 28, 2021, Forbes published an article about the taxation of NFTs.

NFTs can be used as both digital assets and physical tokens. That is, when NFT virtual assets are confirmed, they can also be confirmed for real assets. Based on such characteristics, NFTs that were originally only used as encrypted works of art and personal avatars are likely to develop into indispensable things such as real estate and vehicles in the future.

Boopathi Krishnan
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