You might love them, you might hate them, but one thing’s for sure — you’ve definitely heard a lot about them in the last couple of years.
NFTs (or non-fungible tokens) exploded onto the scene in 2020 and rode a monumental wave of popularity between 2020 and 2022, scoring a perfect 10 from the judges on the shoreline.
Looking back to those heady days, it seemed like the whole world had NFT fever. Examples like Bored Ape Yacht Club became household names, countless celebrities jumped on the bandwagon, and stories of overnight NFT millionaires seemed to spring up every other day.
But compared to the period of their dizzying rise, NFTs had relatively little media coverage in late 2022 and early 2023.
In fact, given the relative lack of coverage — and the recent price crash of the similarly hyped blockchain technology, Bitcoin — you’d be forgiven for thinking NFTs have fallen off their wave and are currently getting slammed into the reef repeatedly (yes, we’re sticking with the surfer analogy dammit).
In reality, NFTs are still going strong. Verified Market Research (VMR) report suggests that the NFT market could be worth $231 billion by 2030. The selling prices may have dropped significantly from their 2021 highs, but due to continued adoption within the video game, music, art and digital collectible industries, there’s still a lot of hype and activity in the NFT space. And that means opportunity for marketers everywhere.
So, while the jury is still out on how the industry will operate and where it will go in the future, the bottom line for businesses is that NFTs undoubtedly present some huge and largely unrealized opportunities.
NFTs as a business opportunity
Across the globe, NFTs are highly publicized, popular with multiple demographics, and seen as a fresh, modern technology. This makes them an excellent way to stand out from your competition, get attention, build engagement, and grow your business.
As a result, more and more businesses are using NFTs as part of their multichannel and omnichannel marketing strategies.
For instance, in the summer of 2021, Coca-Cola hosted a charity auction in the Metaverse for International Friendship Day, where they minted and sold a group of 4 NFT collectibles. In January 2022, Lamborghini launched its first NFT, Space Time Memory, while Prada and Adidas teamed up to create “Adidas for Prada re-source”, an NFT project that comprised 3,000 user-generated art pieces.
But how can your organization use NFTs for marketing to stand out in such a competitive marketplace?
In this article, we look at one of the hottest marketing trends that will dominate 2023, NFT marketing, some of the reasons it works, and how NFTs for business can help to grow your brand.
What are NFTs?
NFTs are a type of digital asset, reliant on blockchain technology used to record ownership and authenticity. Each NFT is unique, cannot be copied, and cannot be divided into pieces. Additionally, they can only have a single owner at any one time.
Ownership can change, however, meaning that NFTs can be gifted, sold, or traded between owners in transactions that are tracked and recorded using blockchain technology.
Most people are now familiar with the other prominent kind of blockchain-based technology — cryptocurrency — and there are some similarities in the way these technologies function.
A crucial distinction between crypto and NFTs, however, is that crypto can be traded for more of the same, such as Bitcoin for Bitcoin (i.e., it is “fungible”), whereas an NFT is unique and can’t be replaced.
An NFT can represent anything digital, and typically acts as a reference to a file such as a piece of digital artwork, a video, a photo, or even a tweet.
As such a new concept, NFTs have created a lot of hype, as well as their fair share of criticism. Those in the pro-NFT camp say that the technology offers a novel way to trade ownership and creates an exciting, profitable new online market with near-limitless possibilities.
Critics, on the other hand, generally point to the lack of legal basis for ownership, the fact that it is a highly volatile speculative market, and concerns about environmental impact.
Whatever your personal stance on NFTs, the fact is that they are extremely popular and don’t seem to be going anywhere. In 2021 alone, NFT sales hit a staggering $25 billion.
How do NFTs work?
NFTs are created on and use a blockchain platform. Most were created, or “minted”, on the Ethereum blockchain in the early days, but other blockchains are now commonly used.
When minted, each token receives an individual identity that makes it completely unique. This unique ID is what enables NFTs to be traded and allows all transactions to be recorded in a public ledger, verifying authenticity and ownership.
Why are NFTs so popular?
A lot of people have been pondering this question since NFTs exploded onto the scene back in 2020. After all, there’s theoretically nothing stopping someone from copying the digital “possession” that an NFT represents.
However, it would be naive to deny that they are extremely popular, despite their apparent flaws. But why?
Well, there are many reasons, and a lot of the popularity can be explained by the fact that, as speculative assets, they can potentially make people a lot of money. For example, people and businesses can:
- Hold and sell NFTs in an attempt to make a profit
- Create their own NFTs to trade
- Mint and sell NFTs to provide startup capital for a venture
- Use NFTs for marketing and developing awareness of a brand
Of these examples, the last one is arguably the most effective way in which businesses can utilize NFTs to benefit their business. A big part of their popularity is based on the fact that many businesses have seen the opportunity to utilize NFTs as part of their marketing efforts. Interestingly, the origins of this can be traced back to the COVID-19 pandemic.
What’s the link between COVID-19 and NFTs?
In early 2020, as the pandemic was really taking off around the world, many businesses were essentially forced to transition away from traditional marketing and focus their efforts on digital channels.
This global trend saw a huge increase in digital marketing efforts across every industry, and that, of course, made it more difficult than ever for individual brands to stand out from the crowd. Sure, repurposing content for social media can work for a while, but eventually you need to think outside the box to really get attention.
As a result of this competition, businesses naturally started looking for ways to make a bigger impact in the digital space. When NFTs emerged and started growing in popularity, partially on the back of the crypto boom and rising interest in blockchain technology, businesses saw the opportunity and started to use NFTs to promote their brands.
This led to more NFTs entering the marketplace and increased publicity, which in turn drove more interest, booming prices, and a greater number of NFT transactions.
The benefits of using NFTs for brands
As we touched on above, there are a few interesting ways in which businesses can benefit from using NFTs as part of their operations. However, the safest and probably most useful option is to use them as part of a marketing strategy to build brand recognition.
One of the great things about this strategy is that it can be exploited by businesses of any size. While NFTs have been used by some of the biggest brands in the world, it’s actually very easy for even those with relatively small marketing budgets to get involved and benefit.
There is of course an element of risk involved. As with any speculative market, popularity, prices, and overall interest can come and go without warning. However, there are many success stories of formerly unknown NFTs taking off and attracting a huge amount of attention.
4 smart ways small businesses can use NFTs to grow (with examples)
NFTs are one of the trends set to dominate the marketing landscape in 2023, so small businesses should take NFT marketing seriously if they want to stay ahead.
Larger businesses have already been getting creative with their use of NFTs, and what they’ve been trying out up to this point can act as good inspiration for smaller operators. And as we shift further into the Metaverse, more small businesses should follow suit.
Here are some examples of how brands can experiment with NFT marketing:
1. Link NFTs to real products
Several major brands have used this strategy, including Adidas, which paired a product launch with NFTs.
2. Promote and raise money for popular causes
Selling NFTs to donate money to a popular social cause is a great way to get positive publicity while also doing some good in the world. Coca-Cola is a prominent example of a brand experimenting with this.
3. Auctions and competitions
Linking NFTs to online events such as competitions and auctions can draw a lot of attention to a brand and has worked well for several businesses. For example, McDonald’s offered NFT prizes for retweets, resulting in a huge amount of exposure and engagement on Twitter, and many companies have run online NFT auctions.
4. Sell NFTs in the metaverse
NFTs offer a useful way to show ownership of digital items in the metaverse, so they are likely to become very popular in the coming years as the metaverse inevitably becomes more broadly accepted.
How can businesses effectively incorporate NFTs into their social media marketing strategy?
When it comes to incorporating NFTs into your marketing strategy, a great place to start is using social media. With the help of your socials you can get the word out quickly and, if done right and with a bit of luck, get shared widely and gain a lot of exposure.
Here are some simple steps to get you started:
Step 1: Come up with an NFT marketing strategy
Working on an effective strategy is the most important part of the process, so it’s worth spending some time looking for inspiration, brainstorming ideas, and conducting market research.
A good place to start is seeing what big-name brands have already tried and had success with. Thanks to their outlandish budgets, they have the most cutting-edge NFT campaigns, bits and bobs of which you can replicate.
Make sure to see what you’re direct (and indirect competitors) are up to, though. When you downscale ideas, you risk going for the most apparent, easiest-to-recreate option that your competitors have already leveraged. You don’t want to be a copycat, do you?
After examining the market, you should have a rough idea of the type of NFT you want to create and how it will be used:
- PFPs and Avatars
- Generative art
- Gamified NFTs
- NFT event tickets, etc
Remember that the type of the NFT needs to align well with the goal you want to achieve with its help:
- Do you want to build a stronger community of customers around your brand?
- Do you want to increase brand awareness?
- Do you want to reach new audiences?
- Do you want to position yourself in a certain way?
- Do you want to differentiate yourself from the competition?
- Do you want to generate leads and sales?
Next, you need to research the target audience for your NFT. Consider their interests, demographics, preferences, and what platforms they are likely to use to interact with your creation. This information can help you create an effective message to promote your NFT.
Understanding where your crowds hang out will help you compile a list of the platforms you’ll use to market your NFT.
Once you’ve created your message and chosen the platforms for your NFT’s marketing, it’s time to start building up hype. It’s essential to plan everything ahead and develop a content strategy to nurture your audience.
Finally, you may want to consider creating a landing page for your NFT. This is an important part of any marketing strategy and it can help you capture the attention of potential customers. Make sure the page is visually engaging and includes helpful information about your NFT.
Step 2: Partner with an artist
Do some research to find an appropriate artist. Ideally, you’ll be able to find someone that can communicate your brand’s identity in an exciting way. Bonus points if they already have a loyal online following.
Here are a few things to consider when looking for the right artist for your NFT project:
- The artist should be familiar with the complexities of the NFT market and have experience in designing digital art.
- Their style and aesthetic should be compatible with your own vision for the NFT.
- They should have decent reputation. NFTs are all about community-building, so make sure you examine the artist’s prior collaborations and customer reviews to get an understanding of their reputation.
Some of the go-to platforms to find appropriate artists include…
- Social media
- Online portfolio sites like Behance and Dribble
- Dedicated platforms like 99designs
Step 3: Mint your NFTs
This is where the magic happens. This process takes your digital creations and turns them into the transferable token that is an NFT. Ethereum has a useful guide on how to mint your first NFT here.
Step 4: Get the word out on social media
Now you’re ready to start promoting your new NFTs! Try to build the hype with a range of teaser announcements and a big reveal:
- Show behind the scenes of your NFT-building process on your brand’s social media
- Host Facebook or Instagram Story Q&A sessions
- Share your NFT’s story with your social media followers
- Launch an AR filter that would generate awareness about your brand’s NFT
- Partner with influencers and industry experts to spread your message
You can also benefit from utilizing paid advertising. For instance, Instagram sponsored posts or Twitter promoted tweets.
Step 5: Drive engagement with active social media management
Maximize the impact and chances of sharing by promoting your NFT campaign widely, responding to comments (even if they’re negative), and encouraging sharing as much as possible.
Here are some of the ways how you can drive engagement to your NFT on social media:
- Create educational content that provides value. Explain how your NFT works, the benefits of collecting it, its history, etc.
- Showcase your NFT and the artists who created it. Highlight the unique features and benefits of each NFT.
- Host virtual events such as online exhibitions, Q&As, and virtual NFT marketplaces, to bring the community together and drive engagement. You can either make them exclusive to NFT-owners, or open to anyone interested in your brand’s NFT.
- Encourage User-Generated Content (UGC). Ask questions, host contests, and reward the most active and engaged members of your community.
- Respond to feedback and questions. Address any concerns or issues and make sure to keep your audience informed about new developments and initiatives.
NFTs for business: A summary
NFTs can be a highly effective way to use modern technology in an innovative, exciting way to promote your brand and build awareness. When combined with social media and even the emerging metaverse, as well as a little creativity, NFT marketing can be a powerful tool in any brand’s marketing arsenal.
It’s unlikely that NFTs are going away anytime soon. And, with the emerging metaverse potentially set to become the future of the internet, they may even be on the cusp of another big boom.
You won’t want to miss it.
Valerie Kakovkina is an experienced content marketing manager and content writer with hundreds and hundreds of published articles about marketing, social media, branding, design, productivity, and sales. She loves exploring new concepts, examining new socio-cultural trends and figuring out how they can be applied to businesses to boost their sales.