NFTs and Advertising – What Are The Impacts?

If you’ve heard of Bitcoin, then you might have come across the acronym NFT or “Non-Fungible Tokens”. It’s a mystery to many what this actually means, and there are whole essays dedicated to telling you what they are and how they work. In fact, many essays contradict one another about what they are, and how useful they are. Nevertheless, no matter how you look at it, the world of crypto currencies and NFTs are changing the advertising landscape. So, here is what you exactly what you need to know, about NFTs and how they’re changing the world of advertising and marketing.

What Are NFTs?

In a nutshell, NFTs are like antiques that can’t be replicated, except they’re digital. NFT actually stands for Non-Fungible Token (as we’ve mentioned), which means it cannot be traded like-for-like. Meaning there is nothing else like it in the world. So, for example, if you have a collection of one-of-a-kind custom-made watches, you can trade it off, but what you get wouldn’t be the same.

NFTs are part of the Ethereum blockchain (a complicated record of trades and other financial dealings that include the trade of NFTs). Don’t worry, we won’t go into a lot of detail about blockchains and crypto currencies here, but if you’d like to know more about what an NFT is and what blockchain technology is, visit The Verge’s article on what NFTs are (2022). It’s not only inciteful, but easy to read. 

The Trend Of Creating Loyalty

One of the biggest impacts of NFTs is the idea that they encourage loyalty to a brand. Not only that, but the industry itself is highly lucrative. As of 1st May 2022, the NFT market stood at $37 billion, and is set to grow even more by the end of the year (Chainalysis, 2022). So, by investing in NFTs, companies can be sure that their customers can remain loyal, with the idea that they’re collecting one-of-a-kind digital assets, the more they interact with the company.

Think of NFTs like a reward scheme. You do something that interacts with a brand, and in return, the brand will give you a one-of-a-kind trading card. That’s exactly what some companies are using NFTs for. However, using NFTs in advertising can either be a huge success, or a major loss, and even if a company isn’t a digitally based one. There are still benefits that could be had, when including NFTs in marketing campaigns (Reblonde, 2022).

Create Unique Customer Experience

Another way that NFTs are changing the advertising landscape is by creating unique customer experiences, whereby the brands can involve their customers, in their marketing campaigns. For example, companies can combine NFT products with virtual events, which include further exclusive reward schemes. Just like the Burger King’s NFT collection experience with their Keep It Real Meals collection. By including QR codes on some of their burger and sandwich packages, customers unlocked special rewards that ranged from digital collectibles to autographed items, or even free whoppers.

 NFTs might seem like they’re only digital assets, but they can also be incentives for other experiences, like receiving a phone call from a celebrity, who are part of a company’s marketing campaign, or getting a surprise visit from your favourite musical artist. NFTs act like rewards, for those who remain loyal, or become loyal to a brand. Think of the Sky VIP Rewards scheme by Sky, in the UK. Customers can take part in exclusive events, if they sign up for a membership. This is a great example of what NFTs can do. 

Changing The Advertising Landscape

While creating a reward scheme isn’t a new concept, the inclusion of NFTs and virtual experiences are. In fact, NFTs were initially intended for artists to showcase their artwork, on a different level. After all, there are only so many gallery spaces available, and it can be difficult to break into the high art scene, if you don’t know paying collectors. By creating NFTs and digital assets, artists can find a new way of selling their art for the same, if not higher, prices than real-world art.

By creating these pieces of art, and then using them as collectibles for companies, the landscape of advertising is changing. Gone are the passive messages on TV and in videos. Now, more companies are making unique customer experiences the foundation of their advertising and marketing campaigns. Not to mention, making those experiences interactive and inclusive.

Customers Become Owners

One of the major things about NFTs that needs to be remembered is that the NFT itself is useless for those who don’t see value in them. After all, anything can become an NFT, like a Tweet, or a photo, or even a video, but owning an NFT is different from having a copy. It means, you have some share in the original piece. Essentially, it’s like being part of an artwork’s provenance. In real-world art, authentic pieces tend to have a logbook of who officially owned it, especially if it’s a very old and valuable piece.  For example, if you were to look into the provenance of the Mona Lisa, you’ll find out the names of the people who used to own it, before it was given to the Louvre Museum.

The same can be said for an NFT, but instead of being passed on person-to-person, multiple people can own a share in the original piece. It’s like having your name in the credits of a movie. This is why NFTs are attractive to so many people, especially those who have the money to pay for it. It’s why so many pieces of digital artworks are sold for millions, if not billions of dollars. For example, The Merge, a digital piece by Pak, was sold for $91.8 million, by 28 983 people (Sensorium, 2022). All these people now have their names forever in the provenance of the piece.

Advertising – An Expensive Interactive Landscape

Don’t be fooled though. While NFTs can be a great experience, and being the owner of a share, of a digital asset, can be exciting. It can also be expensive. After all, at the very start of the NFT wave, in 2021, a digital collage called The First 5000 Days, was sold to an individual, Vignesh Sundaresan, through Christie’s art auction (AugustMan, 2021). So, just because NFTs are starting to filter through, to a more affordable price, if you want those bigger shares, you may need to pay up millions of dollars, to truly own the piece.