Blockchain has been taking the world by storm, and this year is no exception. Improving supply chain traceability and decreasing ecommerce transaction costs are just a few benefits that blockchain technology offers retailers, but now brands should also be paying attention to non-fungible tokens, or NFTs.
Never heard of them? You’ll want to get familiar, and fast. Remember Nyan Cat, that rainbow digital cat meme from 2011? Someone digitally recreated the artwork and sold it for $600K. A digital artist known as Beeple participated in an auction at Christie’s and sold a piece of digital artwork for $69M. And this is only the tip of the iceberg.
NFTs are a new era for brands. Those who act now to find opportunities in this digital era will become pioneers. Those who don’t will be beating themselves up later.
NFTs often provide the biggest advantage to premium brands that have already found success on the back of scarcity, like Gucci and Louis Vuitton. Gucci actually recently confirmed that it’s “only a matter of time” until it releases an NFT. Digital fashion skins have already been embraced by luxury brands in the past, so think of NFTs as the next step in this fashion technology evolution. This isn’t to say NFTs will be exclusive to luxury brands, but they’ll likely be the first to lead its adoption. The scarcity of these items will gradually transition digital fashion into “real” fashion and the brands that understand how to utilize NFTs will be able to capitalize on these assets and cement themselves as leaders in their market.
Think of how important our digital realities already are. We don’t see our internet personas as separate from us — our social profiles and websites are just an extension of who we are. As the world becomes more digitized, and we become more immersed in our digital selves, how we understand, judge, and interact with business will continue to change. We won’t value them for their physical buildings or tangible clothing items, but for their influence in the digital space as well. So, NFTs make sense as the next logical step in the market.
As of right now, these opportunities are still pretty limited. Brands have been able to create and sell GIFs of clothing, but this is expected to change over the course of the next few months. Fashion companies are working to create an NFT fashion experience that’s unlike anything the industry has seen before. Neuno is one example of this. They are currently working to create a 3D wardrobe that isn’t just pretty, but practical as well. A consumer can buy their clothing — like J Lo’s famous Versace dress — and post photos of them wearing it. Once they buy the digital product, they own it forever and they can use it in a variety of ways.
NFTs are another way for brands to reimagine their contributions to the fashion industry. Retail has always been centered around forward-thinking creations that provide a unique, authentic experience for customers. Traditionally, this was done through physical products, but now, brands must begin thinking about how to do this digitally as well. Don’t sleep on NFTs, or else you might find yourself squandering to keep up with the competition.