We’ve waited long enough for a new internet acronym to take the world by storm. Between BRB, AFK and BRB, we deserve a new one. Enter the whirlwind that is NFT.
NFT stands for non-fungible token and is a unique digital item.Think GIFs, digital art and digital certificates, all presented as a beautifully packaged physical item. Essentially, they are digital collectables, and while anyone can rip a GIF to save it for themselves, owning an NFT is like owning the original Mona Lisa vs. owning a printed copy.
NFTs are managed via blockchain ownership, bought and sold (or auctioned) most often using the cryptocurrency called Ethereum (or ETH for short). Some even refer to NFTs as “crypto-collectibles”.
The phenomenon of the NFT has created the perfect storm of investing, high-end art and internet culture. The result? Brands hopping aboard social media to join the NFT gold rush. The first golden-nugget? Ex-Twitter CEO Jack Dorsey’s first tweet sold as an NFT for $2.9 million dollars (mind blown).
Need more convincing? Christie’s, a 255-year-old auction house, offered art by Beeple (aka Mike Winkelmann) for auction in a digital bid that started in February 2021. The bidding started at just $100, before being sold for $69 million to Singapore-based blockchain entrepreneur Vignesh Sundaresan. We can pin Beeple’s success to many factors, but one important reason is his large social media base that spans 2.5 million followers across several platforms.
NFTs illustrate how anyone with a social media audience can promote an item. Creating hype and a sense of anticipation for something that is both tangible and a first-hand experience. When you combine the rarity of NFTs with thousands of praise-hand and flame emoji comments, you have the perfect concoction for the next big thing.
Some brands have already jumped aboard the bandwagon, with Nike patenting blockchain-compatible trainers in 2019. Entitled “CryptoKicks,” they will give sneakerheads a digital representation of their shoes and a crypto-token tying the trainers to the user.
Known for taking risks in the social media space, Taco Bell promoted 25 “NFTacoBell” NFTs on Twitter, at a starting price of $1. One of them sold for more than $3,500. Proceeds were donated to Taco Bell’s Live Más scholarship, with the owner of each NFT getting a $500 gift card to the chain (that’s a lot of burritos).
These moments create virality and buzz for brands, even if it might not seem like a natural fit. For example, P&G’s toilet paper brand, Charmin, launched its own collection called “NFT(P)”. Talk about a royal flush.
The NFT world can be further leveraged across longer-standing social networks. There’s an opportunity for brands to monetise this new movement and provide a richer experience for both existing and potential customers. There are even rumors that the data obtained from NFTs will help brands understand their key demographics better. Each NFT will also make it easier to transfer VIP items and discount codes (beyond the free burritos).