How should consumer brands think about their blockchain strategy?

It depends.

Let’s use high fashion luxury as an example.

Luxury retail has been one of the first industries to show an interest in blockchain technology, with LVMH and Gucci leading the charge.

But why?

Yes, it’s used as a marketing tool— you can get A LOT of free publicity.

For Luxury brands it’s a simple recipe. Launch an NFT collection: get attention.

LVMH’s **Tiffanys **pulled this off well.

Buy an NFT and you get a corresponding Tiffany pendant. Pretty straightforward.

It sold out immediately. The buzz generated around the company, partnering with the Crypto Punk community made the brand attractive to new audiences.

They were featured in almost every major media outlet like Vogue, Bloomberg, Forbes, Techcrunch, CNN.. etc. etc.

With all those eyeballs, could the be the future of marketing in a digital world?

Tiffany sold 250 NFT’s at $50,000 each, instantly generating them ~$12.5m in revenue.

Other luxury brands, like Gucci, Bugatti and Burberry, have done similar.

What’s more interesting is that these brands typically set a 5–10% royalty fee on secondary sales using smart contracts.

This is a very powerful tool for a brand NFT project to finance a project and if these NFTs are traded frequently, this can add up quickly.

Even non-luxury brand Adidas made ~$23m from their initial NFT sale, and royalties have come to about that same amount.

What’s even more impressive is these brands now have intimate communities of wealthy people likely to buy even more overpriced things.

Tiffany didn’t invest upfront as they would normally do with other products.

They did not have to invest and build the product and then sell it…

They were able to check if there was demand for the product first, and then they had the cash flow to produce the products.

This is very powerful for brands. Selling NFT versions first and then producing the exact amount of trainers to satisfy that demand.

No waste. No upfront costs.

There is other benefits of blockchain technology for luxury brands like supply chain transparency, fraud protection, and faster/cheaper payment settlements, but tbh these aren’t necessarily revenue generating.

The bottom line is luxury retail hasn’t innovated on their business model in decades.

.. and if they want to attract new audiences, stay relevant and make more money then they need to be paying attention to what’s happening in the space.

How should consumer brands think about their blockchain strategy?

It depends.

Let’s use high fashion luxury as an example.

Luxury retail has been one of the first industries to show an interest in blockchain technology, with LVMH and Gucci leading the charge.

But why?

Yes, it’s used as a marketing tool— you can get A LOT of free publicity.

For Luxury brands it’s a simple recipe. Launch an NFT collection: get attention.

LVMH’s **Tiffanys **pulled this off well.

Buy an NFT and you get a corresponding Tiffany pendant. Pretty straightforward.

It sold out immediately. The buzz generated around the company, partnering with the Crypto Punk community made the brand attractive to new audiences.

They were featured in almost every major media outlet like Vogue, Bloomberg, Forbes, Techcrunch, CNN.. etc. etc.

With all those eyeballs, could the be the future of marketing in a digital world?

Tiffany sold 250 NFT’s at $50,000 each, instantly generating them ~$12.5m in revenue.

Other luxury brands, like Gucci, Bugatti and Burberry, have done similar.

What’s more interesting is that these brands typically set a 5–10% royalty fee on secondary sales using smart contracts.

This is a very powerful tool for a brand NFT project to finance a project and if these NFTs are traded frequently, this can add up quickly.

Even non-luxury brand Adidas made ~$23m from their initial NFT sale, and royalties have come to about that same amount.

What’s even more impressive is these brands now have intimate communities of wealthy people likely to buy even more overpriced things.

Tiffany didn’t invest upfront as they would normally do with other products.

They did not have to invest and build the product and then sell it…

They were able to check if there was demand for the product first, and then they had the cash flow to produce the products.

This is very powerful for brands. Selling NFT versions first and then producing the exact amount of trainers to satisfy that demand.

No waste. No upfront costs.

There is other benefits of blockchain technology for luxury brands like supply chain transparency, fraud protection, and faster/cheaper payment settlements, but tbh these aren’t necessarily revenue generating.

The bottom line is luxury retail hasn’t innovated on their business model in decades.

.. and if they want to attract new audiences, stay relevant and make more money then they need to be paying attention to what’s happening in the space.