By Jonathan Teplitsky, Pipeline Marketing
The market crash for high-priced NFTs is coming. Given the over-inflation in the market, it would not be a surprise if the high-priced, highly speculative NFTs lost 90% of their value in a matter of weeks. But, from the ashes of the million-dollar NFT, democratization will arise a new frontier in this burgeoning market.
Right now, unless you’re in the top 1% of your industry, whether as a top artist, musician, athlete, etc., you are not making money on NFTs you are issuing. From having the technical know-how to mint your NFT, understanding the inner workings of multiple NFT marketplaces and knowing your audience, and optimizing your marketing strategy, the barrier to entry (both monetarily and intellectually) is just too great…for now.
Accessibility breeds mass adoptions. Let’s take the Fashion Industry as an example. When runway shows happen, they are only done by the most prominent (and priciest) designers. They shepherd in their ideas and bring them to life at shows throughout major international cities. These shows serve as a “what’s next” in fashion and they set the tone for the coming season. However, when it comes to what you see on the street, fast fashion stores like H&M or Zara take those designs and make them accessible to the everyday person who wants to be on-trend. Their clothes may not be made of the same materials, and they may not have the same cache, but they do the job of allowing people to be fashion-forward without breaking the bank. This is called democratization, and this is what is going to happen in the NFT world.
There is no doubt that the 1% have been the industry ambassadors. They brought NFTs the attention they needed to gain recognition and credibility as an industry. It is the same way celebrities help brands gain interest. When a Kardashian is seen wearing a certain brand, that brand experiences an influx of interest. Businesses have used this to their advantage for a long time. It is all about product placement. NFTs will become another important vehicle used to drive customer loyalty even more than they do today. They will become as ubiquitous as social media has when it comes to marketing and raising visibility.
Some of the world’s largest and most mature brands are exploring connecting NFTs with in-store perks or loyalty rewards. McDonald’s launched a giveaway of 10 McRib-themed NFTs, American Eagle launched a collection of 120 NFTs for sale for $1 each, and Clinique launched a contest inviting entrants to win one of three NFTs inspired by some of its best-selling products. If this was a baseball game, we would only be in the first inning.
But these examples, while proving a point, have more in common with the million-dollar NFT than democratization. Despite the low costs of entry to the consumer, they were all launched by large corporations that have the budget and workforce to explore and build their own marketplaces and mint NFTs. Smaller brands don’t have the limitless budgets that blue-chip brands have. Soon, this will change because it has to. There needs to be a leveling of the playing field when it comes to NFTs, or the critics will be right…they will just be a fad.
Currently, the majority of businesses are left out of the NFT marketplace. And America is largely composed of small and medium-sized businesses. In order to get the majority involved and move beyond the “fad,” we need to see an evolution.
The shift will start as accessibility tools are created to enable businesses from small mom and pops to large retailers to integrate NFTs quickly and easily into their current marketing strategy. Most importantly, it must be done without having to understand coding or blockchain technology as that will leave the average business to think that it is too “geeky.” The next frontier will consist of services that make this all possible. And that is where the benefits of a market crash will first be seen.
Jonathan Teplitsky, CEO of Pipeline Marketing and Director of Community Growth for Horizen Labs, has over a decade of marketing experience working at companies like Amazon.com, Uber and Accenture and founding several retail startups focusing on technology and travel. He brings an understanding of how blockchains and digital currencies have the potential to transform the lives of people without access to the traditional banking systems. Earning an MBA from Harvard Business School and a B.S. in Finance and Management from New York University, Jonathan is a former Army officer and has led humanitarian assistance missions in Djibouti, Uganda, and Tanzania.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.