Unlock utility is key for fashion brand launching NFT in 2022

Non-exchangeable tokens, or NFTs, have become one of the most talked about markets in the crypto space this year. A recent report from Cointelegraph Research found that NFT sales are targeting a record $17.7 billion by the end of 2021.

This may be the case, as a number of major brands have started rolling out NFTs. according to For the latest research from Bain & Company and online luxury fashion platform Farfetch, digital interactions with consumers are becoming increasingly important for brands. The report specifically states that “digital interactions with peers are on the rise when choosing to buy a product.” As such, non-exchangeable tokens tied directly to brands and their consumers are now more important than ever.

Understand what utility means for NFT mode

Although mainstream labels like Adidas, Dolce & Gabbana, and others have released NFTs, the utility behind the non-exchangeable tokens is proving to be the real key to the fashion brand’s success. Karinna Grant, co-chief executive officer of The Dematerialised, a digital fashion marketplace, told Cointelegraph that utility is what delivers the purpose and value of non-exchangeable tokens:

“Just like in real life, where a physical card can scan your access to a club, utility can be anything from using NFT as a membership card to the ability to use assets in games, or incorporating sustainability or socially responsible benefits for NFT buyers. ”

Grant notes that The Dematerialized has experimented with different forms of utility with each of the NFT-mode drops that the platform launches. He explained that previous releases have included utilities such as wearing or playing with 3D assets in augmented reality, or opening access to the brand’s community. “With Rebecca Minkoff’s NFT collection selling out in September, the highest-tier NFT unlocks VIP access to a year-long brand experience.” He added: “Karl Lagerfeld’s “x Endless” collection provides owners of Karl’s collection with an IRL and URL ticket to the brand’s event in Paris in 2022, which will feature another launch in which only Karl holders will be invited to take part.”

It became clear that NFT fashion had to offer some kind of consumer engagement, enabling brands to interact with individuals in both the physical and digital worlds. Avery Akkineni, president of VaynerNFT – an NFT consulting firm – told Cointelegraph that while the utility of some NFTs is just for the sake of art, brands launching NFTs need deeper functionality that builds on existing communities.

For example, Akkineni shared that VaynerNFT recently helped global fashion house Coach launch its first NFT collection, which superior eight Coach Holiday animals from the digital game Snow City. Akkineni added that the launch of NFT was also to celebrate Coach’s 80th anniversary, which produced 80 unique digital artworks featuring Coach’s eight holiday animals.

Akkineni explains that each digital NFT Coach also entitles early holders to receive one free, made-to-order physical rogue bag by 2022. “Something Coach wants to do is explore this new world of NFT, but wants to enter in a way that won’t be commercialized. their IP or asking consumers to pay anything,” he said. In order to efficiently engage with the Coach community, Akkineni mentioned that the NFT Coach was provided free of charge during December 17-24 this year:

“NFT Coach can be claimed on the Polygon blockchain. Coach made sure not to commercialize too early and learned about the space to measure demand to see if their audience was interested in NFT.”

Fashion NFT should also work in Metaverse

The fact that brands now have to interact with consumers both virtually and in real life has also added an additional layer of technical utility to NFT. As the newest luxury item from Bain & Company report states, “new keywords and phrases — such as metaverse, personalization at scale, and technology stacks — will come to the fore as the industry grows and evolves.”

As such, several companies have started exploring NFT on the Metaverse. For example, Pet Krewe — a pet clothing e-commerce company — recently opened a digital commercial space in the Metaverse community known as “ShibaVerse.” Allison Albert, founder and CEO of Pet Krewe, told Cointelegraph that the company is promoting its brand by displaying NFT pet clothing on the Metaverse containing balloon dogs called “Shibaloons.”

According to Albert, the NFT Pet Krewe will be worn as a unique design that suits Shibaloons. While Albert points out that these costumes can be held and swapped on different Shibaloon dogs in the ShibaVerse, Pet Krewe uses this digital commercial space as another form of brand engagement or marketing. “We were able to connect with dog-loving customers on the dog-centric Metaverse. It reaches our customer base in a completely different marketing element.”

18-year-old fashion label Mishka has also entered the NFT space with her famous eyeball logo. The collection of 6,696 NFT is known as “The Keep Watch Crew,” or “KWC” for short. Greg Mishka, founder of Mishka NFT and Keep Watch Crew, told Cointelegraph that Keep Watch is the most iconic and well-known branding element. from Mishka, both for fans and the streetwear and fashion community.

Given the label’s strong user base, Mishka explained that KWC’s NFT is the next chapter for the brand. “KWC is your ticket to what we call MISHKAVERSE. Live utilities include lifetime discounts and exclusive merchandise,” he explained. Mishka added that the label is working to integrate Web3 elements into their website. “This will allow consumers to verify the NFT they have in order to access the exclusive page and drop through the website.”

Should NFT mode still be associated with physical items?

While the utility of fashion NFT goes beyond simply offering digital goods connected to physical goods, some in the industry believe that it is still one of the most important functions. For example, Grant noted that linking physical items to digital NFTs was an important part of the adoption process for non-exchangeable tokens of all categories. He explained:

“We have a very interesting separate perspective with our community right now, with half asking for more physical and half asking for more digital only. However, when we surveyed outside of our current community, the numbers were much higher. This makes sense because first-time or new NFT owners tend to still hold the more traditional belief that physical products are more “value” than digital ones.”

Concurring with Grant, Mishka comments that it is important to have physical items that can be claimed or achieved by acquiring something in the Metaverse because most consumers still live in the “real world.”

This is why it should come as no surprise that mainstream fashion labels like Coach are giving NFT holders a physical, made-to-order rogue bag. Interestingly enough, Akkineni mentions that sometimes NFT holders don’t redeem their physical items, which has proven to be the case for other drops associated with consumer-facing brands. “VaynerNFT did a collaboration called “Anwar Carrots x Veefriends,” which is a collection sold on Nordstrom and available to all holders of the “Self-Aware Hare” NFT. Only after a few reminders that the holder is claiming a physical item,” he comments.

NFT fashion will be a trend

The advent of NFT in 2021 has shown moving growth forward for big brands. While companies like Nike have taken steps to enter the Metaverse, more labels will follow. This has been the case as the world moves towards a digital business model, which has also been promoted by the advent of COVID-19. For example, Albert explained that Pet Krewe is still unsure how COVID-19 will develop in 2022, noting that supply chains are currently still disrupted:

“We need to protect our bets on alternative revenue streams. Entering a metaverse that aligns with our corporate values ​​means we can add additional revenue streams through state-of-the-art NFTs and digital wearables.”

Grant further said that The Dematerialized is excited for a “behavior-altering launch,” which includes using NFT to disrupt physical production methods. However, it is important to point out that brands will face challenges along the way.

According to Grant, fashion labels will face three main obstacles, the first is a shift in thinking regarding the value of Web3 and digital ownership. Second, Grant explains that understanding the purpose and narrative of NFT’s launch is important: “We support a launch that is part of a long-term strategic commitment to Web3, not a marketing gimmick to drive revenue in the short term.”

Lastly, Grant points out that it will be a challenge for big brands to ensure a 3D asset design channel in-house. But Grant remains optimistic that these challenges will be overcome: “Mainstream adoption will come when more fashion brands, influencers, and creators get involved.”