Blockchain technology and NFTs aren't going anywhere and some big brands have dipped their toes in and proven they can create real engagement.
Marketers are always looking for new strategies and technologies to gain a competitive edge, so it’s no surprise that there’s a lot of talk about how NFTs and blockchain technology can help brands grow when looking ahead to the year ahead. The digital landscape has expanded to include 3D AR and VR environments. Meanwhile, Meta (the company formerly known as Facebook) has been forging ahead with the concept of a connected metaverse.
As marketers consider all the options on the horizon, they should set clear goals and expectations rather than chasing the next flashy gimmick. But they also shouldn’t miss the shift to blockchain and virtual environments that is happening right now across a number of marketing channels.
Benefits of Blockchain for Identity
Because the location of all data on a blockchain is recorded in a decentralized, public ledger, this makes the blockchain much more transparent to consumers when it comes to the origin of their data. Companies using blockchain technology for data also have a number of security options when it comes to handling and storing data, on or off the chain.
The advantage of transparency in customer data is that the data is not held privately on a company database or shared with third parties without the customer’s permission. This way, there is no distinction between how a business uses customer data and how the customer expects that data to be used, regardless of how the customer interprets a particular data sharing agreement when they check the box to grant permission. Sharing their data using blockchain is a way for brands to build trust with customers who are concerned that their customer data is being exploited in other transactions and long-term licensing agreements.
If companies gain more trust with consumers by using blockchain technology, it will sweeten the deal of obtaining more first-party data, something every brand needs now more than ever.
NFTs in the metaverse
Non-fungible tokens are digital objects that use blockchain technology to ensure they are unique. Anyone who acquires an NFT can prove their ownership because the transaction is recorded on a decentralized, public ledger.
This is important, because the visual representation of an NFT on a computer screen can easily be replicated with a screenshot. It is the blockchain that designates who owns this rare digital gem.
For brands, NFTs can create brand equity and brand love in a number of ways, but as a virtual keepsake, it makes the digital object more personal to the customer. It’s not a Burger King crown that any BK fan can pick up at the store. Instead, it’s a unique object that the customer jumped through specific hoops to get, and they can prove it on the blockchain.
There is already an environment where consumers can showcase their NFTs, powered by blockchain providers who mint NFTs and provide digital wallets and trophy cases for users to hold them. But when operating in a virtual environment, those NFTs can follow users wherever they go. This makes NFTs essential to the VR experience and is why they will become even more important as a VR metaverse takes shape.
NFT Responsibilities
One thing marketers should be aware of is the negative impact that certain blockchain technologies have on energy consumption. In order to update the ledger for each unique token or coin, computers in a decentralized network work to create a new chain. Many blockchain providers have overcome this concern by committing to their sustainable practices.
When marketers introduce an NFT promotion or other blockchain strategy, they will want to let consumers know that the technology they are using is environmentally responsible.
Marketers in the metaverse
“Marketers will begin to explore branding opportunities in the metaverse,” said Stephen Hoelper, president, North America, at programmatic messaging company Doceree. “Brands that deliver experiences that are engaging and less invasive than the current digital marketing landscape will have the greatest impact early on in the new space.”
“Brands are taking notice: prepare for the metaverse,” said Sanjay Mehta, director of industry, e-commerce at cloud-based experience company Lucidworks. “This is an opportunity to reimagine virtual experiences and find better ways to do all the things we’re trying to do in the real world, including building community among customers, experiencing real-world merchandise, understanding shopper behavior, and creating more personalized (AI-powered) concierge services.
“There are a million directions retailers can go, but those with a clear intention and desire to enhance the overall experience with the metaverse (rather than building something from scratch just because) will be able to get ahead,” he added.
Jack Smith, Chief Product Officer at ad verification company DoubleVerify, said:
Brand theft in the metaverse?
As marketers dive into the virtual world that the metaverse promises for the first time, they should understand that some of the strategies and logic of traditional channels may not work. That’s because intellectual property protection laws are rooted in the real world, or “MeatSpace.”
As the metaverse becomes more connected with more engagement, the cat-and-mouse game will likely evolve, perhaps resembling ad fraud in the advertising landscape or other forms of deceptive digital fraud.
Marketers should pay attention to how they can issue NFTs, choosing proven partners in this emerging space.
As with any new digital channel, there is a buzz among consumers that marketers can share. But ultimately, the buzz needs to translate into sales.
Original post: https://martech.org/how-marketers-will-use-blockchain-technology-and-nfts-in-2022-for-identity-branding-and-engagement/
Translated by: Phan Cong Duy
