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NFTs, also known as non-replaceable tokens, are a fast-growing asset class within the cryptocurrency market. Public awareness of NFTs emerged in 2021 when a laser-hot trend of collectible digital artworks hit the scene. It was a revolutionary technology because it allowed creators to tokenize, authenticate and sell digital content.
At the beginning of 2022, the global NFT market was worth approximately $3 billion. This rating is expected to reach $13.6 billion by 2027. So you may be wondering, why do so many people spend real dollars to acquire virtual goods?
To help you fully understand the potential of NFTs, let’s start with their evolution leading to the present, then move on to their applications in the future.
Today’s Digital Property Revolution
NFTs have made the process of owning and identifying digital assets easier than ever. The metadata underlying all non-fungible tokens are decentralized and securely mapped on the blockchain. This data can be quickly verified and is useful in determining the rightful owner of an asset, not to mention distinguishing similar assets.
Related: One-Click Access to Web 3.0: Blockchain Adoption Toolkits
Past, Present and Future: NFT Evolution
Until now, artists, filmmakers, musicians and other creatives have been among the first users of NFT technology. Numerous companies and celebrities have also started using NFTs to engage their followers. A recent trend is to use the technology for different types of access passes or proof of membership.
The Future of NFTs in the Web 3.0 Landscape
When it comes to web 3.0, the next evolution of the internet, NFTs are a game-changer. Their widespread use will catalyze decentralization and the establishment of reliable/permissionless networks. As such, NFTs will be fundamental to both metaverse and web 3.0 economies.
In addition, NFTs are practical for decentralized verification purposes. For example, tokens can be used to prevent scams and a plethora of ID-related security vulnerabilities, as each token’s credentials are verifiable on-chain.
In addition, NFT technology can help brands overcome many of the obstacles that prevented them from adopting digital marketing practices more fully.
Related: Web3 could see its own Dot-Com tree. Here’s how to survive the bust.
NFT Profits: Obstacles to Making Money
You’ve heard the saying: it takes money to make money. NFT coins can be profitable, but it is expensive and requires significant investment. While free NFTs exist, most tokens are issued and sold for amounts that can intimidate everyday investors. Let’s not even talk about gas costs and high marketing costs for the publishers!
Earning Potential with NFTs
As with cryptocurrency, NFTs are speculative investments and sensitive to fluctuations. While it is possible that you will make a lot of money buying or selling NFTs, there is no guarantee. Therefore, a little homework can go a long way. Make it a habit to analyze past sales records before purchasing. This is a reliable way to understand the long-term profit potential.
What’s the news with NFTs today?
Given their rapid growth in popularity, NFTs remain an attractive investment opportunity. This is evidenced by the increasing number of transactions and the number of companies entering the space. In recent months, market momentum has sharply but temporarily declined due to what has been called the crypto winter.
Nevertheless, experts predict an increase in global NFT trading volume as the assets live up to their potential in the coming years.
NFT Adoption: Applications and Benefits
NFT projects have become a hot topic, especially in the marketing industry. In 2021, the NFT market cap exceeded $23 billion, representing a 20,000 percent year-over-year growth. Major brands have started investing in the crypto and NFT space:
- According to the Gartner Hype Cycle for key enabling technologies, NFTs will fundamentally change the functions of marketing.
- Bee The Drum Digital SummitAdcolony and The Drum brought together execs from Coca-Cola, Dole and VaynerNFT to talk about how they used NFTs in their marketing campaigns.
- Adcolony Vice President Tom Simpson pointed out that brands can raise capital by selling NFTs. Marketers can include NFTs in their promotions or as part of their Customer Relationship Management (CRM) mix.
- VaynerNFT president Avery Akkineni stated that marketers may be put off jumping into NFTs in the early stages because the communities are still small. After all, Opensea has an average of only 20,000 daily users. However, getting embedded early can help reinforce brand authenticity in the metaverse.
- Coca-Cola recently launched a campaign in which their story revolved around the metaverse and real life.
- Dole’s campaign encompassed the brand’s mission for healthy food. The team talked about the technology’s learning curve and discussed what they learned along the way.
Related: Make your brand a household name using the power of NFTs
So, how can NFTs be used in the context of modern marketing?
- NFTs provide ownership and a way to connect directly with communities.
- Brands are no longer limited to offering physical goods and services. NFTs can be anything: artwork, 3D animation, music, land in the metaverse, etc.
- Brands can track the ownership and origin of their assets and ensure that the data associated with them is accurate and non-tamper-evident.
- Consumers demand transparency and NFTs offer companies a way to meet this need.
- NFTs provide brands with a way to engage with their customers more effectively.
- NFTs eliminate complex logistics such as shipping, taxes, and storage costs.
NFT marketing is more than bringing your NFT to the attention of your target audience. It involves using creative digital marketing strategies to generate unique and meaningful experiences while achieving long-term marketing goals.
According to AsiaPac Digitala smart way to enter the space is to partner with experienced digital NFT marketing agencies to generate buzz and get your NFTs to the right audience.
To achieve successful adoption, digital marketers must learn NFT concepts that are constantly evolving, adopt NFT influencers, and ensure legitimacy in their operations.
The best opportunities for making significant profits often arise when markets are new. Fortune favors the bold.