How the Metaverse and NFTs Are Changing Brand Marketing
Whether you consider yourself tech-savvy or hopeless when it comes to technology, you’ve likely encountered the terms “metaverse” and “NFTs”. With the pandemic, many people substituted their in-person interactions with online communities — such a drastic worldwide shift has accelerated the progression of society towards virtual life. It is estimated that by 2026, 25% of people will spend at least one hour a day in the metaverse, with Gen Z currently driving this seismic shift. The metaverse market size was estimated to be worth around 40 billion USD in 2021 and is a crucial tool for capturing younger demographics. If you’re wondering how your brand can harness this purchasing power and benefit from entering the metaverse, continue reading this article based on the WiT webinar: “Bringing Your Brand Into The Metaverse.”
The metaverse can be defined as any virtual space where users can interact within an immersive environment with other users. This is a deceptively simple definition that encompasses many already thriving communities online — but a central theme of the metaverse is decentralization. A single corporation or company cannot own it or run it, such as web giants like Meta or TikTok, and access to the metaverse is open and reachable to all. NFT stands for “non-fungible token,” meaning it is a unique, non-exchangeable digital asset. While the most common forms of NFTs are images, they can be any digital file, such as audio or video. The critical difference between an NFT and a digital item is with the former, you have proof of ownership and authenticity. That means that the digital asset is uniquely yours, and you have the right to do with it what you please. Selling and buying NFTs simply requires a transfer of ownership of that asset.
Now, you may be asking yourself, how are the digital sales of images and other files creating such significant demand that people are willing to spend tens of thousands of dollars on them? The short answer is: marketing. When you buy an NFT, you become a member of an exclusive community of similar asset holders. You may gain access to events run by a related club, both in person and online; you may gain access to a niche online community to chat with on platforms such as Discord; you may even gain access to restaurants that solely serve club members with specific NFTs. A notable NFT club is the Bored Ape Yacht Club, which has garnered attention for the outrageous bid prices for their assets and cult-like following of celebrities. Access to this exclusive club entails limited edition merchandise and collaborations with high-end designers such as Gucci and Louis Vuitton. Club members are even gifted additional NFTs that can be sold for hundreds of thousands of dollars, making it a large return on your investment for a seemingly innocuous digital image.
According to MetaBrands founder and president Tamara Knepfer, “NFTs can transform relationships between brands and consumers.” We have seen the proof with the high demand for certain NFTs and new marketing strategies for the metaverse. Notable metaverse marketing campaigns utilize already popular platforms, such as gaming platform Roblox or Fortnite, to get their products in front of a new audience by offering digital assets such as skins to users. Ralph Lauren successfully ran a marketing campaign in the metaverse platform game Roblox by offering iconic clothing to be purchased for avatars, seeing a 40% increase in digital business shortly after the launch. Traditionally an older demographic clothing line, Ralph Lauren’s marketing on a kid’s game allowed a newer generation to be exposed to the brand name and build upon a strong interactive community, forging a deeper connection with the consumer. Successful NFTs and metaverse marketing create a community that encourages interactions through platforms such as Discord, which allows you to utilize this tight-knit community to instill brand loyalty, promote new product events and launches, collect data, and increase repeat purchases of your product. Social media-based campaigns or influencers are frequently onboarded to increase the initial popularity, or clout, of metaverse products and applications. It’s essential to recruit celebrities that your target demographic will flock to, such as gaming streamers or similar-aged influencers. Digital events with well-renowned artists and musicians are a great way to capture attention in the metaverse and drive brand awareness as virtual concerts gain popularity.
The metaverse will play a decisive role in the future of business and digital marketing, and all brands will need to be involved in some way to remain competitive. Utilizing the strong community base that the metaverse has fostered over the years through social platforms can help your product reach new audiences, instill brand loyalty, and promote new products. As with all recent tech innovations, the most important aspect to successfully harnessing the full potential of the metaverse and NFTs requires constant learning and actively searching for current trends to help your business grow.
This blog is inspired by WiT Webinar “Bringing Your Brand Into The Metaverse: How to Get Started – from Virtual Worlds to NFTs.” Watch it on WiT’s Webinar archive HERE.