You’ve probably heard of NFTs by now. You may even know that the acronym stands for Non-Fungible Tokens. To most of us, though, that still doesn’t mean a whole lot. Everyone knows they’re a big deal, but few people can explain what NFTs are, why people want them, and what you can do with them.
That’s why we’re writing this blog post. Beyond explaining what an NFT even is, we’ll help you understand how you can use NFTs for business growth, connect with consumers, create unique experiences, and ultimately grow your bottom line.
What's an NFT?
Let’s start at the beginning. A non-fungible token (NFT) is a unique token you own that can’t be replaced with something else.
The token is linked to something of value. In most cases, this is a digital asset that can be held on a computer. Think about digital art, music, or even written reports and articles. However, NFTs are swiftly invading the physical world too, linking to real-world objects, places, or experiences.
So, owning an NFT is like a certificate of ownership. Proof that you own that thing that the NFT links to. It works because NFTs and all their transactions are held on a blockchain (normally Ethereum), which is set up for NFT transactions. That means if there is a dispute over who owns an NFT, anyone and everyone can follow the trail of an NFT’s ownership from its inception to the current owner to discover the true owner.
Why should you use NFTs for your business?
NFTs are so successful in part because they promote exclusivity. The world can easily be divided into groups of people who have a particular type of NFT and those who don’t.
Businesses can use this exclusivity to create communities of people who share a particular NFT. Organizations can achieve this in two steps.
- First, give tokens to people who have been with the organization for a certain amount of time, spent a certain amount of money, or some other qualifying factor.
- Then, reward the holders of these NFTs in ways that allow them to connect. Perhaps by giving them access to venues or events in the real world or opportunities to join special forums or social media groups online.
Other businesses use NFTs more directly by selling them to customers. Traditionally, once a creator sells their product, that’s all the money they can expect to get from that piece. NFTs, on the other hand, can be pre-programmed so that the creator takes a cut of all the following transactions. If the new owner sells the product at a profit, the original artist continues to take a cut. Businesses can increase their residual incomes by taking advantage of these “smart contracts” that they can program into NFTs.
Finally, NFT marketplaces like Opensea.io, Rarible, and Foundation allow businesses and individuals to quickly set up, distribute, and sell NFTs. Their close association with cryptocurrency means users already have everything they need to pay for products and services without much additional setup.
8 ways to use NFTs for business growth
We’re just going to scratch the surface here because people constantly invent new ways to use NFTs for business. However, if you’re looking for inspiration for your business, these might fit the bill.
- Let’s start with the most straightforward opportunities. Your business can create and sell digital collectibles. This is the most popular way for companies to enter the NFT economy.
Unless your business’ core strategy is selling NFTs, consider how your digital collection will link to your brand and be desirable to your target audience. Selling NFTs should always tie back to your business and core product.
- As we explained earlier, loyalty or membership programs are an excellent way to use exclusivity to reward people who buy or earn your NFTs. Offer rewards to NFT holders that create communities by connecting them to your brand and each other.
- Use NFTs for business growth as a “proof of attendance” for events like conferences or other ways they engage with your brand, like listening to a podcast or responding to a request for feedback. If you have a grand opening, consider the gift of an NFT for the first 100 people through the door.
- Don’t forget to engage with those people you distribute NFTs to. Drive engagement with your business by periodically offering special promotions, privileges, and opportunities to NFT owners.
- Authenticate products through NFTs. If customers buy a limited edition item like a designer bag or pair of sneakers, provide them with an NFT to prove that it’s authentic, and if they want to resell it, they get an easy way to pass on that proof of authenticity.
- Use NFTs to differentiate between the first edition of a book or other product and subsequent sales. First-edition collectors pay big money to own what is essentially just the oldest version of a product that anyone can buy — making NFTs perfect to help this age old collection market evolve!
- NFTs can act as one-time use coupons or promotions. Whoever owns the NFT can cash in or use it whenever they want. If the current owner doesn’t have a use for the coupon or promotion, they can sell it to someone who does.
- Finally, savvy businesses are using the technology in NFTs to raise money for charity. NFTs can be programmed so that a percentage of each resale goes to a designated charitable organization. Integrating with this technology does a lot of good and boosts your business reputation in the process.
Creating NFTs for your business with RebelDot
If you’ve been inspired by some of our ideas of how to use NFTs for business growth, or perhaps you’ve got a totally new and unique idea in mind, we want to hear about it!
Talk with one of our blockchain and NFT experts today to take advantage of the NFT economy.