Why Utility Is Critical for Fashion NFTs in 2022
2021 was a defining year for fashion nonfungible tokens (NFTs), but fashion brands must launch fashion NFTs in 2022 with a utility to be able to continue working with and profiting off NFTs. Therefore, this article helps explain why some form of utility is critical for fashion NFTs. For those who don't know, NFTs have become incredibly popular in the crypto space. Research shows that NFT sales could reach $17.7 billion by the start of 2022. With that said, let's learn about why NFTs tied to fashion brands are important for consumers.
Understanding What Utility Is for Fashion NFTs
Many major fashion brands labels such as Dolce & Gabbana, Adidas, and other brands have released NFTs for their customers. However, the utility of NFTs is what has helped various smaller fashion brands reach success. Karinna Grant, The Dematerialised's co-chief executive officer, has discussed that the utilities of NFTs are what give them value and purpose.
She explains that utility in the context of NFTs can be anything. For example, it could allow NFT-owners to wear their asset in a game, access a membership pass. On the other hand, it could also present opportunities for social responsibility and sustainability for NFT-buyers. The Dematerialised, for example, has released fashion NFTs all with various utilities, including the ability to wear or play with a 3D asset in augmented reality.
The X Endless collection by Karl Lagerfeld offered owners of its fashion NFTs access to an IRL and URL ticket to a brand event this year in Paris. In addition to that, the utility of those NFTs will also provide Karl holders with access to a launch event in the future. Therefore, fashion NFTs can grant users access to specific communities where they can interact with other people and get other benefits. Therefore, NFTs with specific utilities allow fashion brands to interact with customers and other interested parties in physical and digital spheres.
Why Utility Is Important for Fashion NFTs in 2022
While NFTs may simply offer artistic value in many cases, it's important for brand-related NFTs to offer some utility to make them appealing to customers. The president of VaynerNFT, Avery Akkineni, has also discussed the importance of brand NFTs to have functionality that's based on existing communities. VaynerNFT recently helped Coach, a global fashion house, launch its debut NFT collection. The NFTs were created as part of the company's 80th celebration, in which it released 80 unique digital artworks that contained 8 holiday animals related to Coach.
These fashion NFTs were not released only as art pieces, but they also offered all initial holders the chance to secure made-to-order physical rogue bags that are complementary. Therefore, this brand attempted to enter the world of NFTs by offering something to the consumers for free. What was even more remarkable is that the NFTs were handed out for free to specific consumers from December 17 to 24. Users could claim the NFTs on the Polygon blockchain. The purpose of this step was to determine whether consumers were interested in their NFTs and also to help expand their brand.
This example, therefore, indicates that there is indeed the potential for fashion NFTs in 2022 to be attractive to consumers. However, there has to be some direct benefit (in the form of utility) of owning them for customers if the company wants to be able to use NFTs as a means to market their brand and improve their overall sales and profit margins.
Fashion NFTs Must Function in the Metaverse Too
Fashion NFTs must consider being functional in the metaverse to become successful. Some fashion companies have already begun to bring their NFTs to the metaverse. Pet Krewe is a company that creates and sells apparel for pets. So, this company created a digital commerce space in ShibaVerse, which is a metaverse community.
The company has been selling NFT pet clothing for "Shibaloons," which are digital balloon dogs. Holders can apply and swap these clothing NFTs on any of their Shibaloons. Thus, Pet Krewe has been using that to market its own brand in a completely digital space, opening up access to a potentially newer and wider audience than otherwise. This is also owed to the fact that the market they're targeting consists primarily of dog lovers.
Should Fashion NFTs Still Be Connected to Physical Items?
The utility of fashion NFTs in 2022 can move past offering digital items for physical goods, but that is still undeniably a critical function. Grant of The Dematerialised discussed physical items must be connected to digital NFTs to help them become adopted more readily by consumers. She notes that there are still some new NFT owners who believe that physical items have more value than digital ones. Therefore, the utility of NFTs can help even those users see the benefit of purchasing and owning NFTs.
Fashion NFTs in 2022 May Become a Trend
If there's anything we could take away from 2021 regarding fashion NFTs in 2021, it's that it's likely to become a trend in this new year. Mainstream brands such as Nike have already begun making their NFTs available in the metaverse, and it's likely that other brands will do the same in the near future. The fact there's some utility to fashion NFTs in 2022 is likely to help them become even more popular than before.
Last Few Words
There's no doubt that there will be challenges in making fashion NFTs in 2022 a trend. Grant of The Dematerialised highlights that the narrative of NFTs and their purpose will be critical in helping push people to consider investing in them. That is perhaps where the utility can help explain the value of owning brand-related NFTs, especially to users with more traditional beliefs about the value of certain products over others. In addition to that, more fashion brands and influencers will need to be involved in helping shape the narrative of NFTs.
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