Cofounder of Yunicorn Ventures. Passionate about all things related to branding and marketing.
Spend enough time on the internet these days and you’re bound to eventually stumble upon both good news and bad news about NFTs (non-fungible tokens).
NFTs have been getting a lot of attention, and the reality is that it’s a space filled with fraud. However, there are legitimate, successful NFT projects out there—and they use specific marketing strategies to generate consumer loyalty, interest and excitement. Here are the three marketing strategies typically accompanying successful NFT projects and what other businesses, regardless of industry, can learn from them.
1. Nurturing Brand Loyalty With Freebies
The NFT space didn’t invent the concept of freebies in marketing, but it’s capitalized on it exceptionally well.
It’s no secret that people like free things. In a study published in 2007, researchers coined the term “zero-price effect.” According to the researchers, they ran experiments that showed “that when people are faced with a choice between two products, one of which is free, they overreact to the free product as if zero price meant not only a low cost of buying the product, but also its increased valuation.”
There’s a reason why companies hand out freebies left and right at tradeshows and conferences—they know that people will respond well to them, making it an easy way to market their products and make their brand names “stick” in consumers’ minds. Some NFT projects have executed this strategy incredibly well and have nurtured brand loyalty with consumers.
Consider the Chainsmokers, who decided to freely give some of their fans part of the royalties from their newest album via a collaboration with a music NFT marketplace. Another example is the free 2022 Indy 500 NFT, which INDYCAR stated would be “free to everyone who purchased a seat” at the event. And of course, there’s also Tripsters’ Bored Apes giveaway.
With every free NFT a consumer receives, a better, more prominent picture of the brand that did the giveaway forms in their mind. Other businesses can also benefit from the “freebie” approach, and the freebies in question don’t have to be NFTs. They just need to be something those consumers will deem valuable.
2. Creating The Sense Of Belonging To A Community
Think about the different customer loyalty programs you’re part of. Maybe you’re a member at your favorite retailer and can get special offers and rewards once you hit certain milestones, like spending over a specified amount.
Community-building is a powerful marketing tool for brands. As Susan Fournier and Lara Lee wrote for the Harvard Business Review, “Harley-Davidson faced extinction” in 1983, but the brand’s “commitment to building a brand community” was key “to the company’s turnaround.”
When consumers feel like they are part of something bigger than themselves, they naturally are more likely to engage with and spend more money on those brands. Some NFT brands have recognized the benefits of community-building and jumped on it. NFT brand PROOF Collective is a fantastic example of this. CNET writer Daniel Van Boom billed Proof Collective as “possibly the best example of an NFT acting as both profile picture art and community membership.” Proof Collective, Van Boom continued, “has an exclusive Discord frequented by some of the biggest players in crypto and NFTs.” Another NFT brand that’s done a great job of creating a sense of joining a special club is the Bored Ape Yacht Club; people who purchase Bored Ape NFTs are joining the ranks of celebrity Bored Ape owners.
Non-NFT brands are taking note, too. For example, Starbucks announced plans to create NFT collections for its customers, and Coke and Pepsi have also released NFT collections of their own. However, ultimately, businesses don’t necessarily need to center their community-building efforts on NFTs. Creating loyalty programs and social media groups are just two other ways brands can effectively cultivate a sense of belonging among their consumers.
3. Generating Hype
Generating hype isn’t a new concept in marketing. Apple is one of the best examples of a company that gets people excited about its upcoming product launches.
Some NFT initiatives have implemented this marketing strategy quite well. Just look at the mystery NFT boxes Nike promoted, piquing people’s curiosity. There’s also Adidas, which smartly positioned its first foray into NFTs by marketing exclusive access. As Jacob Kastrenakes of The Verge reported, the company positioned buying its NFTs as the entry to being “able to purchase special merch drops” and being able to help “shape what kinds of products and experiences the company puts together for its NFT-owning community.” The hype paid off. Adidas made $23 million from that initial NFT drop.
Another smart tactic Adidas used? Phasing its NFT drops. In April 2022, the company announced that it was kicking off the second phase of its “Into the Metaverse” NFT initiative, directing Adidas NFT holders to a website where they could get special merchandise. Phased rollouts like what Adidas employed are great for boosting anticipation and excitement about a product.
Businesses in other industries, take note. If you position and release your new products in a way that gets your potential and existing customers buzzing about what’s to come (alongside giving freebies and building a community), you’ll have a stronger likelihood of reaching or solidifying “it’ brand status—whether or not you decide to go down the NFT route.