Wars. Inflation. Infrastructure failure. In spite of difficult times, consumers are making a conscious decision to choose ‘Joy’.
Targeting young tech-heads? Perhaps NFTs are the way to go?
By our News Team | 2023
Non-fungible tokens (NFTs) are usually associated with celebrities and market volatility. But there is untapped potential for marketers.
Marketing can make its practitioners dizzy as they try to get to grips with our brave new world. What is the Metaverse – and is it going to be a boon or turn Mark Zuckerberg into a pauper? How can marketers harness the Blockchain? What are NFTs and should African marketers care?
One step at a time. Let’s deal with NFTs and why there’s a sense that marketers can perhaps turn them to advantage.
Image by Tumisu from Pixabay
Non-fungible tokens (NFTs) have gained popularity over the past few years as an alternative asset class – although, just to add to the uncertainty around them – there are those who say they’re not an asset class at all, but rather a technological way to indicate ownership. The speculative value of NFTs is also undermining their true potential.
While investors are beginning to realise they’re not exactly bankable assets – a Chainalysis 2021 NFT Market Report says only around 44% of trades are profitable – this doesn’t mean NFTs don’t hold value for marketers, who have found they can reach those sought-after younger generations by including NFTs in the marketing mix.
NFTs are records of assets that exist on a blockchain – which is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system.
NFTs can also be both digital and physical; or ‘phygital’, which is a combination of both. The ‘physical’ aspect is linked to ‘hard’ assets such as merchandise, property deeds, works of art and more. The ‘digital’ element points to the NFT being a digital token that can’t be transferred because it represents ownership of something unique and authentic.
So far so good? It’s no wonder that NFTs are still confusing to many in the marketing profession!
So much more than ‘tradeable pictures’
Professor Gert-Jan van Rooyen, co-founder and CEO of South Africa-based start-up Fanfire, which provides Web3 solutions to companies, NPOs, sportspeople and artists, says NFTs are so much more than ‘tradeable pictures’.
“They are digital tokens with smart contracts’ that can be programmed to create highly innovative ways of interacting with each other and their owners,” he asserts.
The cybercurrency tokens have featured most prominently in the art world, but they can be used in many other retail contexts, which is where marketers tend to sit up and take notice.
Footwear manufacturer Nike, for example, partnered with blockchain platform Rarible to launch the first native Web3 sneaker. The customisable product lives on the blockchain but also in the real world, where wearers can programme which colours and animations will light up when they walk, thanks to rechargeable batteries.
Kirsty Bisset, Managing Director of Africa-focused marketing agency HaveYouHeard, says creating unique, limited-edition versions of products is just one way to reward customers for loyalty or engagement – and create new revenue streams in the process.
“NFTs can take the form of collectibles, such as trading cards and sports memorabilia, or exclusive concert experiences and limited-edition videos in the music industry,” she explains.
The techno-social market in which we live places a premium on celebrity, and brands that can give their loyal customers a taste of what it means to be an insider can tap into the new ‘clout economy’, which is all about status and bragging rights. For example, NFTs can provide exclusive access to celebrity influencers and content creators on social media, Bisset says.
Read more about using NFTs in the marketing environment in the latest issue (Issue 1 2023) of Strategic Marketing for Africa, the in-depth quarterly magazine of the African Marketing Confederation (AMC). You can download a free copy of the Digital Edition here.
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