How can retailers and brands use NFT for themselves

Benjamin Berker, Head of Retail and Consumer Goods at T-Systems MMS

T-Systems MMS

Benjamin Berker, Head of Retail and Consumer Goods at T-Systems MMS

T-Systems MMS

NFTs can help recharge brands. They provide the opportunity to inspire target groups of young people, to ensure innovative interaction with the brand and thus create loyalty. Companies should not miss these opportunities.

Written by Benjamin Berker, Head of Retail and Consumer Goods at T-Systems MMS

NFT “first movers” have made headlines around the world and the price development is rubbing the eyes of some. No wonder: According to the “Research and Markets” report, the NFT market was valued at 41 billion US dollars in 2021. The global market is expected to reach 211.72 billion dollars by 2030. However, it is important to identify the possibilities at the right scale, because the current crises The initial enthusiasm has also left their mark in this market.

So, how have companies used NFT technologies so far and what can be envisaged in the future?

Who is the target group?

Although a large part of the population in the Western world has not heard of NFTs, NFT drops from well-known companies regularly generate a lot of interest. Younger, smart consumers in particular are increasingly engaging with the topic, which is already evident in the large number of online articles, social media discussions, and events related to the Metaverse and NFT.

In addition, the NFT community is already huge. Through NFT projects, companies can access this community and take advantage of the sheer scale and willingness to interact from members. Another supporter in the development of the target group is social networks, which has been proven by the rebranding of Facebook in Meta, as well as the soon-to-be-released NFT group of TikTok.

Talking about a dead (verse)

Using virtual reality, retailers can give their customers the opportunity to interact with their brand in a unique and immersive environment that tells the brand’s story and sets it apart from the crowd. For example, Dior Beauty has created its own virtual Christmas store, featuring gift options and limited-edition products at Atelier of Dreams. In general, luxury brands are pioneers in the use of virtual stores.

Brand Heat

Deciding on an NFT project allows the company not only to position itself as a digital leader, but also to significantly increase its brand engagement. Although NFTs as products may have nothing to do with the actual product suite, companies can use them to delight existing customers and attract the attention of new potential customers. In order to reach out to the existing NFT community in the best possible way, it is advised – especially for newcomers to NFT – to enter into collaborations with the most prominent influencers and projects in NFT.

For example, adidas has worked with leading projects and influencers Bored Ape Yacht Club, PUNKS Comic and gmoney for the “Into the Metaverse” NFT group and has been able to directly generate significant interest in the community for their group. So it’s not just about new technology, but also about collaborations with creators that can open up new horizons for businesses.

Limited editions despite delivery bottlenecks

Due to supply bottlenecks, some companies are currently unable to meet high customer demand, for example the bicycle market, where components are missing. At Schwalbe (Ralf Bohle GmbH) they have been working on limited collections of bicycle tires for some time, including in collaboration with stars in the industry.

The goal is to set an example in the digital world with particularly unique products and dramatically increase your reach outside of niche commerce. However, it has not yet been revealed whether these bike tires can also be purchased in virtual stores in the future given the real supply bottlenecks.

New loyalty benefits and a new community

In addition to interaction and brand awareness, NFTs are also suitable for creating exclusive communities and customer loyalty programs. For example, Dolce & Gabbana gave owners of the “Collezione Genesi” NFT collection physical equivalents of virtual clothing and jewelry, giving them free entry to Dolce & Gabbana’s haute couture shows for a year.

Especially the exclusive seats for these programs make them very attractive. Customers can be inspired and retained. This also underscores Starbucks’ intent to create a global digital community around coffee using the NFT loyalty program.

revenue opportunities

In addition to the previously mentioned capabilities of NFTs, selling them also offers the possibility of an additional income stream. The potential revenue from NFT sales may still be relatively small for most companies in the retail and consumer goods segment compared to revenue in the core business, but the market is growing aggressively.

Especially with the expected strong increase in the numbers of Metaverse users, the importance of NFT sales will continue to increase. For example, users can wear NFT sneakers in the Metaverse and actively use them physically.

Be brave!

NFTs provide the opportunity to take a company’s brand interaction to a new level. Given the large and rapidly growing potential of NFTs, companies must evaluate the many possible uses and find the best individual solutions for themselves. And with all the ideas, there are important decisions to make when dealing with technologies. Even if the topic is new, NFT can be a smart move into the future, and it’s better to be there and help shape it rather than miss the trend.

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