NFTs have attracted a lot of attention within many industries, with a variety of potential commercial and social use cases.
eCommerce is one very prominent space with overlapping potential alongside NFTs, yet many might overlook the existing opportunities between these two concepts.
Before we look at how brands can utilize NFTs, let’s quickly cover the basics of an NFT.
What are NFTs?
Non-Fungible Tokens are referred to as NFTs, a keyword here is ‘Token’. NFT tech is a means of tokenizing a product so it has a digital ownership logbook. NFTs are frequently lumped in with and confused with cryptocurrencies like Bitcoin. The sole connection between NFTs and cryptocurrencies is that they are tokens existing on a blockchain.
Compared with football, each NFT represents a player in the league, and Bitcoin is the equivalent of a pound. The paperwork system that each team keeps and uploads to the league officials each time a player is transferred is the blockchain technology underpinning it all. Each of the NFTs, or footballers, is the ‘property’ of a different owner, who is governed by a different contract.
Each has a value that may change depending on factors like demand, prior owners, reputation, market conditions, comparable sales...etc. They may be sold or exchanged at any moment for a price or conditions that the buyer and seller agree upon.
Finally, the owner might just hold them to a contract. It's important to note that these contracts may contain clauses that favor the player, the owner, or a former owner.
6 ways businesses are utilizing NFTs
NFTs are the ideal addition to eCommerce companies because they are transferable, collectible goods. They are also getting simpler to produce and sell. Merchants may now mine and sell NFTs thanks to Shopify. If you’re a merchant, look into using Shopify for selling straight from your storefront, rather than requiring retailers to use a third-party marketplace. The Chicago Bulls introduced NFTs on Shopify's platform in July 2021 that featured the team's trademark six World Championship rings.
1. Sale of collector’s items
Retailers are selling NFT collectibles that are extremely sentimental to superfans. When used in this way, they raise brand recognition and foster fan relationships. Coca-Cola, for instance, sold its first NFT during the International Friendship Day Auction. Some of the brand's prominent assets were reinvented for the metaverse in the multisensory token. A real vintage refrigerator with ice-cold Coca-Cola and a digital prize box was awarded to the winning bidder.
2. Digital duplicates for the metaverse
RTFKT Studios, a provider of digital collectibles that combine gaming and culture, was recently bought by Nike. Real and virtual sneakers were marketed by RTFKT along with young artist FEWOCiOUS. The end result: They sold 600 pairs/ NFTs for a total of around $3.1 million in just six minutes.
Jewelry is a fascinating example of a digital/physical combination. On Microsoft's AltspaceVR app, jewelry from the website Artsy can be rented in the Mall of the MetaVerse. These are referred to as Mixed Reality Extensions and are wearable in various virtual environments.
3. Loyalty programs
NFTs will be the new drive of loyalty and engagement by providing practical benefits. Health information, event tickets, and loyalty cards can all be transferred to the blockchain. Both the buyer and the retailer gain from this. For instance, blockchain-based loyalty programs reduce expenses and enhance the customer experience.
Customers can use their points interchangeably and have access to many loyalty programs from a single digital wallet. They may use rental car points to pay for dinners at a fine dining restaurant and redeem grocery store loyalty points for a vacation.
4. Proof of ownership and transactions
Pretty much anything can be tokenized with the right legal framework. It involves connecting NFTs to a tangible object or piece of data, such as a car title, a house deed, or medical records. This provides a safe method of ownership transfer for business owners, retailers, and dealerships. There is no questioning ownership because NFTs are publicly provable on the blockchain.
5. Pre-launch of physical products
Brands like Nike and Adidas have tied NFTs to product drops. Tokens can be employed when launching tangible goods in advance. Before a new product is released, NFTs generate discussion and visibility, allowing your brand to build a strong network of early customers.
6. Physical display
NFTs are fascinating and cutting-edge, but they have a drawback - they are entirely digital. You need to take out your phone or tablet to appreciate them. One workaround for this is to use customized tablets to display NFTs. They transform NFTs into works of art fit for a gallery. That's what Fred Segal, a clothing store in Los Angeles, did when it established a physical gallery to show off memorabilia, specially made clothing, and gaming equipment.
The exhibition included artwork from the Bored Ape Yacht Club, the Mutant Ape Yacht Club, Doodles, and Cool Cats, among other collections owned by prominent NFT collectors. The Bored Ape Yacht Club artwork, costing 35.47 ETH, or around $142,466.32, was the most expensive NFT on display.
Are NFTs in eCommerce really a thing?
Although NFTs might not replace tangible goods anytime soon, they can enhance your offerings and improve the appeal of your brand to a customer base that is more inclined toward digital transactions.
The technology will take some getting used to, but once you do, it might be worth the effort since it allows you to develop and evolve your brand in new ways.
Major brands and business owners are already looking to use NFTs for their eCommerce platforms in multiple ways, from research and development and launching products to selling digital goods and implementing loyalty programs. Only time will tell how much more utilization will be viable in the near future for NFTs in the eCommerce space.
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While still in its early days, the NFT craze might be just the right choice your brand makes right now. Relite aims to empower businesses via NFTs, a $300B market, by opening the funnel for NFT mainstream adoption. We help retail brands like yours implement a custom-tailored NFT strategy that will keep you on the edge of competition.
Want to sell NFTs on your website? The Relite creative team is here to assist! If you are not sure where to start but you want to innovate, contact us today to discuss the best NFT strategy, specially tailored for you.
