How Are Businesses Using NFTs To Create Communities With Their Target Audience?
NFTs have undoubtedly become a trending topic these days. The concept has grabbed attention, and brands look eager to adopt one of the most sought-after items of digital consumerism. An acronym for Non-Fungible Token, NFTs have allowed brands, artists, and digital creators to offer a unique digital asset that a solo owner can purchase. These collectables are built using blockchains, and they have unique identifiers and metadata that make them different from other NFTs.
In India, during Valentine’s week, caffeine innovation brand – Rage Coffee, implemented an NFT marketing campaign to capture young audiences. The tagline for this promotional activity was “Rage Coffee is making people lose their NFT Virginity this Valentine Day,” and leading social media influencers like Marketing Market, HustleRani, Financial Literate and Under25 News discussed and posted about the campaign. It was the first time an Indian brand utilised NFTs for a promotional campaign.
The NFT industry has surged in the last two years, rising from $100 million in 2020 to $22 billion in 2021 NFT campaigns are also suited to millennials’ interests, and by investing in NFT initiatives, businesses can be both profitable and create impact. In fact, all demographics are drawn to impact investments since they are both sustainable and profitable. As the younger generation invests more, NFTs can capitalise on their interest in impact investing.
How are businesses using NFTs?
Due to their versatility, the world’s top brands across all industries have adopted NFTs in their branding and social media marketing strategy. The following are some notable instances of how businesses are using the NFT trend.
The Delhi-based coffee brand has used NFTs for their Valentine’s month marketing campaign in which they issued 10 branded NFTs to lucky winners. They capitalised on the NFT craze and made a successful attempt to create a community of coffee lovers. Previously, the company has utilised the buzz around cryptocurrency for its branding purposes.
TacoBell was the first fast-food chain to use NFTs for its marketing strategy. They launched 25 NFTs as a celebration activity when they brought potatoes back on their menu, and surprisingly, all 25 tokens were acquired within 30 minutes of launch. The highest claim for an NFT was USD 3,646.
Charmin, a toilet paper producing company, has launched 6 Non-Fungible Tokens as digital toilet paper and donated the raised money to Direct Charity Funds. This campaign grabbed worldwide attention as it was considered a unique branding strategy, and simultaneously fulfilled community commitment.
Last year, Coca-cola released four animated NFTs to celebrate International Friendship Day. These digital artworks were intended to deliver multi-sensory experiences and the owner of these NFTs got to unlock a surprise item. Aimed to add entertainment value, the surprises consisted of a ‘Coca-Cola Bubble Jacket Wearable’ that can be worn in Decentraland (a VR platform), and a Coca-Cola Friendship Card. Successful bidders also received a Coca-Cola refrigerator stocked with beverages.
In November 2021, the fast-food restaurant chain dived into NFT promotion to celebrate the return of their limited edition McRib. The world’s largest chain of restaurants has released a certain number of virtual McRib collectables to create engagement in the short-term return of its limited edition. Those who retweeted the McDonald’s collection were eligible to make bids for the NFTs. It was an excellent marketing strategy as around 21,000 people retweeted the invitation within a few hours, and, as of the beginning of 2022, 93,000 people have entered their bids.
How can NFTs be utilised for marketing campaigns?
Let’s discuss some reputed brands’ approaches to utilising NFTs for their marketing campaigns.
To Sell Their Products or Services
Several globally acclaimed brands have started creating unique NFTs to integrate with the features of their actual products, to trigger the purchasing desires of their customers. At the end of last year, sports shoe brand Nike had introduced its NFT shoe named Criptokicks to allow customers to create their own virtual sneakers. The company will then turn these creations into genuine products. Another example of a successful yet smart implementation of NFTs is Alibaba’s mooncakes. The company created a limited edition of NFT mooncakes during a cultural festival, and managed to sell 50 NFTs within two days through a lucky draw.
To Buy Digital Collectables For Brand Awareness
VISA, the financial giant, has dived into the NFT buzz as an NFT collector. The company declared the purchase of CryptoPunks, and set an amount of $ 150,000 for these NFT based virtual avatars. Through this, VISA successfully gained access to the CryptoPunk creators’ community, and is putting in its best effort to create a fruitful association with leading Fintech players and payment gateways.
To Collaborate For Marketing
Non-fungible tokens are creative mediums that are bringing together two different brands to collaborate and create something exceptional that can help both brands in their marketing strategy. As NFTs are not real products, they have no limitations. For instance, soft-toy brand Barbie has entered the battle to utilise the craze that is NFTs, in association with French fashion brand Balmain. They both have collaboratively created three innovative NFTs, and the claimer(s) will soon get the product in physical form as well.
To Contribute To Social Causes
Previously, we discussed the campaign run by TacoBell. The brand had donated all the revenue generated through NFTs to the scholarship programme under the TacoBell foundation. This campaign has allowed them to create a large community and increase their reputation and follower base.
However, NFTs are not assets that generate revenue; but are significant in lead generation, conversion, and sales, as:
Provides a Unique Brand Experience To Consumers
Brands use NFTs as a crucial part of their storytelling and make their relationship stronger with customers by offering something tangible. Customers can own NFTs as a memento of their brand experience. Thus, businesses are attracting a millennial customer base that loves to go with the trends, with the generation being highly influenced by personalisation.
Enhances Brand Awareness And Loyalty
When a business or brand introduces an NFT, it improves the brand image among existing customers, and disseminates a message to potential customers (especially the new generation) that the brand has a trend-setting approach and knows what its customers want.
Improves Customer Interaction And Brand Value
Businesses are establishing healthy communication with the community of new-gen customers and are welcoming user-generated content. Moreover, brands ask customers which type of NFTs they wish to own. Brands are using these communities to support social causes and generate crowdfunding. They also use NFT revenue for charity, thus representing the values of their customers as well.
NFTs play a vital role in building communities around brands, and these groups are usually connected by shared respect, genuineness, and appreciation of the artwork. Businesses that consider NFTs just a marketing medium, and don’t have much connection with art or artists might even start getting left behind. Therefore, rather than using these communities to promote your brand, businesses must consider getting genuinely involved in social causes.
Unlocking Unlimited Opportunities
NFTs are a brand-new way to generate revenue and increase brand engagement. These digital collectables are accelerating online traffic and sales. It is a business strategy that helps to wipe away storage, transportation, or maintenance costs. These tokens have few limitations as they can take the shape of the digital form of any product or brand, and can be owned.
The good news is that NFTs’ actual influence will emerge gradually over the next few years, giving us plenty of time to find out where we fit in. Your ultimate audience will be all of your current and future clients, not just the bitcoin community today. As a result, don’t judge your success based on your NFT prices on OpenSea. Rather, focus your measurements on those that will help you envision a future in which NFTs anchor all real-world products and experiences while extending them into the digital realm of your choice.
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