Marketing trends 2023: The future of customer obsession
The top marketing trends for 2023 are all about zeroing in on the customer with the right data and insights to drive effective engagement.
Between crashing cryptocurrency values, collapsing crypto exchanges, and continuous crypto heists, you’d think CMOs would run screaming from anything even remotely related to digital money.
Yet, despite all the calamity, one crypto asset remains core to many marketing programs: NFTs.
NFTs, or non-fungible tokens, were all the rage a little more than a year ago when cryptocurrency was hot. Celebrities like Gwyneth Paltrow, Paris Hilton, Shaquille O’Neal, and Snoop Dogg promoted them.
Venture firms like AU21 Capital, Shima Capital, and Sfermion injected millions of dollars into the companies creating them. And major brands like Coca-Cola, Budweiser, Adidas, Clinique, and Norwegian Cruise Lines made them cornerstones of campaigns and activations.
No wonder DappRadar estimated the global NFT market at $24.9 billion in 2021. Verified Market Research (VMR) projects the market will hit $231 billion by 2030.
Let’s look closer at NFTs, how they can benefit marketing, and how brands are using them.
What is an NFT?
So, what are these things calls NFTs? To understand NFT, it’s helpful to first talk about blockchains.
In the evolving Web 3.0 world, which emphasizes decentralized applications and digital money for e-commerce, every currency interchange is recorded in an irrefutable, secure, and open digital ledger known as a blockchain. Every form of cryptocurrency operates on its own dedicated blockchain.
NFT stands for non-fungible token. NFT is a digital asset based on cryptographic blockchain technology, similar to cryptocurrency. But rather than acting like money, they show ownership for one-of-a kind digital collectibles such as artwork, music, memes, trading cards, and video game wealth.
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Bored apes, cryptopunks, and M&Ms
Depending on their perceived value, utility and blockchain affiliation, an NFT can sell for anywhere from a few bucks to an average of around $900.
But some digital art pieces have reportedly sold for tens of millions of dollars, including digital artist PAK’s “The Merge,” Everydays: The First 5000 Days image collection, and PAK’s “Clock.”
Then there are the more commercially marketable names in NFTs, such as the 10,000 or so cartoon images in the Ethereum-based collection known as the Bored Ape Yacht Club or the 10,000 characters in the CryptoPunks collection from Larva Labs.
Like TV personalities showing up on school lunch pails or superheroes landing on kid’s meal boxes, marketers are licensing these images in all sorts of ways. The Mars-owned candymaker M&Ms, for instance, recently partnered with Kingship, a musical supergroup, to use Bored Apes on limited-edition collectible boxes.
Paramount also recently released an NFT collection to promote its Avatar Legends franchise. Even luxury brand Tiffany & Co. jumped into the NFT fray by offering 250 custom jewel-encrusted pendants to people owning CryptoPunks illustrations.
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3 marketing benefits of NFTs
Many marketers see NFTs as valuable tools and continue building programs around them because of a few significant benefits, including:
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Attract new customers
Companies like Reddit, the popular social news aggregation and discussion platform, arguably owe their success (and existence) to NFTs. In just a few months, the site convinced 2.5 million new registrants to sign up for NFT wallets through a marketplace it launched in July.
The 40,000 “Collectible Avatars” sold out quickly. Interestingly, Reddit accomplished this without talking about NFTs, cryptocurrency, or blockchain. Instead, they focused on simple and accessible language for the masses.
“Our aim was to continue removing barriers to Web 3.0 entry by giving more people access to the blockchain while rewarding Reddit users with the ability to represent themselves in a way that reflects their passions and internet personas,” says Neal Hubman, head of global client solutions at Reddit.
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Build loyalty
Some brands use NFTs to create buzz for their loyalty programs. Instead of overused scratch-off game cards, modest product discounts, or goofy toys or prizes, brands create value around unique collectibles that customers can only get by patronizing their sites.
Starbucks, for example, recently began offering its rewards members the ability to earn and purchase digital collectible assets that unlock access to new benefits and immersive coffee experiences. Starbucks Odyssey participants can engage in a series of activities, such as playing interactive games or taking on fun challenges.
The company says this delivers value for loyalty customers and fosters community around the brand and its products. Community-building is a top NFT benefit, says Geoff Renaud, CMO and co-founder of Invisible North, a marketing agency.
“Building a community around NFTs lets you create the ultimate focus group where loyal customers are interacting with your brand and proactively engaged in helping to improve it,” he adds.
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Create event aura
Many consumers enjoy and even seek opportunities to attend live or digital events that feel exclusive. Some savvy marketers see benefit in using NFTs as tokens for entering games, concerts, trade shows, and other live events.
In other cases, they use them as VIP tokens that unlock certain special experiences for paying customers at these gatherings. The Utah Jazz, for example, launched virtual locker room NFTs that gave tier-one ticketholders virtual reality access to the team’s locker room. After the tour, they could then attend a Q&A with the team owner.
NFTs have become indispensable for connecting with young audiences at festivals like this year’s South by Southwest (SXSW) where they were literally dropped everywhere as part of marketing promotions and activations. Even Dolly Parton released them in tandem with her appearance at the event.
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FIFA, Nike’s Dot Swoosh, and TimePieces
Every day, it seems, more brands are unveiling NFT collectibles and communities. Here are some high-profile examples:
- The FIFA World Cup, Budweiser, and Visa launched NFT collectibles in advance of this year’s games that included iconic moments, many rare, from previous tournaments.
- Nike recently launched its .SWOOSH NFT platform. Members will be able to learn about, collect, and eventually help co-create virtual objects like shoes and jerseys. Vogue Business reports Nike has already generated at least $185.3 million in revenue from Web 3.0 products, outflanking competitors Adidas and Puma.
- TIME Magazine this year announced TIMEPieces, a new NFT community featuring 4,676 original works from more than 40 artists. In March, the publication also released its first full magazine as an NFT. TIME said its Web 3.0 ventures had generated more than $10 million in revenue around its community of 25,000 artists, collectors, and “enthusiasts.”
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Marketing with NFTs: Tread carefully
Despite their increased use and utility, experienced marketers caution against wading in the NFT pool too quickly.
The underlying technology, they note, is still relatively immature. Moreover, it’s all based on decentralized infrastructure, which means nobody really owns responsibility for its management and security – in other words, there are no throats to choke. And it remains largely unregulated.
That doesn’t mean it won’t get there and become the trustworthy marketing tool that many people imagine. But for now, an ounce of preparation could save a pound of pain down the road.
Before moving ahead, Renaud recommends marketers talk to their legal team at length, making sure they understand all the risks associated with working in decentralized environments, as well as the importance of having compliance plans in place to handle any regulatory issues.
“There’s a lot of promise for marketers there, but if we’ve learned anything about this space recently, it’s that it’s still very early stage and unpredictable,” he says.
