The world's major brands have begun to build NFT communities to chase the success of exclusive crypto-native clubs such as Bored Ape Yacht Club.
Yahoo Finance sat down with Camilla McFarland, vice president of customer success for NFT commerce platform Mojito to get an update on the movements of big brands into the crypto-space.
Renowned corporations from the world of fashion, art and sport are now eyeing the fervour and devotion to 'community' that has made NFT collectives such as World of Women, Bored Ape Yacht Club and CryptoPunks highly valued brands in their own sense. Brands that are crypto-native and so fully integrated into the burgeoning Web3 environment.
The traditional corporations are eager to capture some of the passion and spending frenzy experienced in NFT auctions that have seen illustrations of cartoon apes sell for millions of dollars.
This mixing of mainstream brands with the crypto 'wild-west' has been labelled Web2.5 by Mojito, as it straddles the territory where the two worlds meet.
The figures of mainstream consumer interest in big brand NFTs are still a trickle in their overall sales volume, but the trickle could become a torrent.
This has led to big brands experiencing their own sense of FOMO, anxious to become early adopters of NFTs, the metaverse and the promises of blockchain technology, lest they miss out on the shift to metaverse living and more digital ownership.
McFarland met with Yahoo Finance at the EthCC in Paris and explained how these "incentivised communities who have bought a brand's NFT co-own it with the brand".
She explained how they then become "incentivised to root for your team, which is the brand behind the NFT, the communities do the marketing themselves, and that is really new for brands".
Brands, such as Adidas (ADS.DE), Sotheby's and Liverpool FC (LVRP) are now deciding which audience to target with these new NFTs, "the crypto nouveau riche, or their normie fans, who are a much bigger community", McFarland added.
The challenge facing big brands is how this new technology can be used to better interact with and serve customers.
Below are four world-famous brands that have made inroads in the crypto-space by deploying their own NFTs.
Sotheby’s have seen an opportunity with NFTs and with the assistance of Mojito has built its own NFT market to trade artwork.
This gives the world’s largest art and luxury auction house its own concrete footprint in the NFT ecosystem.
Sotheby’s has partnered with Delaware-based NFT studio Mojito, to attract the increasing number of traditional art dealers and collectors adopting NFTs.
This is Sotheby’s first investment in a crypto company, showing that the brand sees a future in NFTs and other crypto assets.
The auction house has looked at how crypto-communities evolve, by having an active Discord account that NFT owners can access.
The purchasing of NFTs on Sotheby's NFT marketplace has been streamlined for consumers unfamiliar with the plethora of crypto-jargon that can be an obstacle to user engagement.
Crypto-savvy customers can connect to the marketplace with decentralised wallets, such as a Metamask wallet.
But, if a new entrant into the world of NFTs is confused by the jargon, they can buy an NFT through Sotheby's centralised marketplace, paying with a debit or credit, avoiding the use of cryptocurrencies.
The potential of NFT communities to generate increased brand loyalty has not gone unnoticed by sporting giants, such as Liverpool FC and the Milwaukee Bucks.
A lot of football teams are exploring the space, with McFarland claiming "the whole Premier League is looking at NFTs now, so is the NBA. However, nothing compares yet with the way that Liverpool FC approached the sector with an awesome NFT concept".
She added: "All the players from the team were involved, with lots of different traits and features on each NFT that were generated by an AI algorithm. The buyer would pay for each NFT on the Polygon network, so they get a hybrid player card collectable. The experience was similar to unwrapping a pack of football collectable playing cards. The community saw a lot of value in it, and notably a little over half of the participants who bought an NFT were first-time buyers."
McFarland described the 'utility' offered by these NFTS, allowing owners access to the Liverpool Heros Club, "an NFT community with access to a gated Discord, that gives direct access to the team itself, live chat during games, and a ton of other giveaways".
Of all the fashion brands that have dipped their toes into the NFT space, "Adidas have done the best, they nailed it, as they took a crypto native approach", McFarland claimed.
The NFT was called, Adidas Originals: Into the Metaverse. The collection numbered 30,000 and the launch was in partnership with NFT clubs; Bored Ape Yacht Club, PUNKS Comic, and crypto influencer gmoney.
McFarland described Adidas' strategy here as to "court the crypto native buyer".
The scheme worked, as in its debut weekend, the project generated 11,391 Ether (ETH), worth over $43m at the time.
Watch: The Crypto Mile: How blockchain technology could usher in Web3