NFTs Are Making A Corporate Comeback
Two years ago, non-fungible tokens were sizzling hot, as art aficionados and speculators pushed blockchain-based images to $27 billion in value. Now that the market has crashed, a much less ambitious version of NFTs are finding a welcome home in the marketing departments of corporate America.
In the first week of October, non-fungible token (NFT) trading fell to its lowest weekly level since 2020, according to data from TheBlock, with only $50 million worth of digital collectibles exchanged on secondary markets. It was a bleak month for NFTs, whose trading volume plummeted from a record $3.2 billion a week in 2022 as prices slid to fractions of their crypto-boom highs.
The tepid activity came two weeks before Nike planned to sell more than 30,000 pairs of its popular Dunks sneakers in a collection linked to NFTs, with an increasingly popular twist that allowed non-blockchain buyers to get in on the action. Unlike virtually all of the previous efforts, buyers could pay by credit card instead of using cryptocurrency, snagging a custom-sized pair of Dunks in one of three color combinations, white and blue, black and purple and black and red.
Read the full story on Forbes: https://www.forbes.com/sites/mariagraciasantillanalinares/2024/01/19/forget-boredapes-and-cryptopunks-nfts-are-making-a-comeback-in-corporate-branding/?sh=1a95c4681a03
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In the first week of October, non-fungible token (NFT) trading fell to its lowest weekly level since 2020, according to data from TheBlock, with only $50 million worth of digital collectibles exchanged on secondary markets. It was a bleak month for NFTs, whose trading volume plummeted from a record $3.2 billion a week in 2022 as prices slid to fractions of their crypto-boom highs.
The tepid activity came two weeks before Nike planned to sell more than 30,000 pairs of its popular Dunks sneakers in a collection linked to NFTs, with an increasingly popular twist that allowed non-blockchain buyers to get in on the action. Unlike virtually all of the previous efforts, buyers could pay by credit card instead of using cryptocurrency, snagging a custom-sized pair of Dunks in one of three color combinations, white and blue, black and purple and black and red.
Read the full story on Forbes: https://www.forbes.com/sites/mariagraciasantillanalinares/2024/01/19/forget-boredapes-and-cryptopunks-nfts-are-making-a-comeback-in-corporate-branding/?sh=1a95c4681a03
Forbes Daily Briefing shares the best of Forbes reporting on wealth, business, entrepreneurship, leadership and more. Tune in every day, seven days a week, to hear a new story. Subscribe here: https://art19.com/shows/forbes-daily-briefing
Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1
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TechTranscript
00:00 Here's your Forbes daily briefing for Monday, January 22nd.
00:05 Today on Forbes, Forget bored apes and crypto punks, NFTs are making a corporate comeback.
00:13 In the first week of October, non-fungible token, or NFT, trading fell to its lowest
00:19 weekly level since 2020, according to data from The Block.
00:23 Only $50 million worth of digital collectibles was exchanged on secondary markets.
00:28 It was a bleak month for NFTs, whose trading volume plummeted from a record $3.2 billion
00:34 a week in 2022, as prices slid to fractions of their crypto boom highs.
00:41 The tepid activity came two weeks before Nike planned to sell more than 30,000 pairs of
00:46 its popular Dunk sneakers in a collection linked to NFTs, with an increasingly popular
00:51 twist that allowed non-blockchain buyers to get in on the action.
00:56 Unlike virtually all of the previous efforts, buyers could pay by credit card instead of
01:00 using cryptocurrency, snagging a custom-sized pair of Dunks in one of three color combinations
01:06 — white and blue, black and purple, and black and red.
01:10 Appealing to its traditional youthful buyers worked out for Nike, with the sale bringing
01:15 in $7 million, or an average of about $230 a pair, and each Dunk owner would own a digital
01:21 version of the sneaker on the Ethereum blockchain.
01:24 It's a release model that has proven to be a useful marketing maneuver.
01:27 In August 2022, Nike offered a 10-piece leisure apparel collection through its CloneX NFT
01:33 line.
01:34 The Beaverton, Oregon company, famous for its long relationship with Michael Jordan,
01:39 has been selling NFT-related apparel since December 2022, when it released the auto-lacing
01:44 CryptoKicks IRL collection of sneakers.
01:47 Pieces from that inaugural offering, that sold for about $900, can now fetch up to $3,000
01:53 in sneaker resale sites like StockX.
01:57 Steven Vasilev, co-founder of NFT studio Artifact, which is spelled in all caps RTFKT, which
02:04 was purchased by Nike in December 2021, says that the Dunk Genesis collection, quote, "was
02:10 a huge success."
02:12 He adds, quote, "Even though the market is still down, our products are still bringing
02:16 in new people."
02:19 Non-fungible tokens are created, bought, and sold on blockchains, like cryptocurrencies
02:24 such as Bitcoin and Ether.
02:26 But while each currency's tokens are alike, every NFT is unique and can be used to reward
02:31 users with various perks or be linked to objects in the real world.
02:35 They can also be traded on numerous secondary markets, like OpenSea.
02:40 The NFT landscape has drastically shifted in the two years since the tokens became part
02:44 of mainstream art and pop culture.
02:47 Barely more than a year ago, CryptoPunks, a collection of thousands of pixelated headshots,
02:52 and the cartoon simians of Bored Ape Yacht Club commanded multi-million dollar price
02:57 tags at auction.
02:58 Now, the most expensive rarely trade for over $100,000.
03:03 NFTs selling for over $10 million disappeared last year, and companies born out of NFT collections
03:10 like Wrecked Guy and Bored Ape's purveyor Yuga Labs are struggling to pivot their business
03:14 models away from royalty payments generated by secondary sales.
03:19 The overall market shrank to $9.5 billion of revenue last year from $26.7 billion in
03:26 2022, according to CryptoSlam.
03:29 Emerging from the aftermath of the NFT craze are major companies that are embracing the
03:34 tokens as a cutting-edge marketing device, helping them get closer to existing customers
03:39 and woo new ones.
03:40 Vasilev, who is a member of the Forbes' 2023 30 Under 30 Retail and E-Commerce list, says,
03:47 "Where Nike serves athletes, we serve creators.
03:51 We don't like the word NFT.
03:53 We believe it's too technical and confuses a lot of customers, so we prefer to call them
03:57 digital collectibles."
04:01 Sneaker companies like Nike are at the forefront of NFT's second coming, but they are not alone.
04:06 While eking out meaningful revenue or profit is a long way off, corporate America is finding
04:11 useful ways to employ the unique blockchain-based tokens in their marketing arsenals.
04:17 Some companies like Nike are incorporating NFTs into their products, bringing virtual
04:21 images to physical reality.
04:24 Credit card giant MasterCard, for example, partnered with crypto neobank Hai to allow
04:29 NFT users to showcase their own NFTs on the plastic cards in their wallet.
04:34 Beyond physical branding, others have included blockchain elements into existing marketing
04:39 strategies.
04:40 Coca-Cola added NFTs to its global Masterpiece advertising campaign in June, in which the
04:45 company's iconic red and black bottles were passed around by animated versions of well-known
04:50 artworks like Edouard Munch's "The Scream" and Vincent van Gogh's "Bedroom in Arles."
04:57 For full coverage, check out Maria Grazia Santayana Linares' piece on Forbes.com.
05:04 This is Kieran Meadows from Forbes.
05:06 Thanks for tuning in.
05:07 [Music]