Four NFT Tokenization Models To Build Branded Communities
Choosing the Right NFT Frameworks to Connect With Consumers
Tokenization is the process by which brands develop direct-to-community NFT strategies and tactics to achieve their marketing objectives and reclaim ownership of their relationship with consumers, fans, and collectors.
We already know that NFTs are a way for consumers to establish a digital identity — an avatar with which you can consistently engage. And if you’ve done your research, you know that implementing non-fungible tokens is as easy as “plug-and-play” with platforms like Mint. It’s even easier for consumers to purchase, earn, or claim them without any knowledge of crypto. Familiar transactional methods with email and credit cards will suffice. We’ve also talked about how you can distribute NFT tokens on a tactical scale — from attaching them as a bonus to another purchase to airdropping them as a gift for fans.
Your next decision is which tokenization model to implement on a strategic level to build your brand communities. Read on to learn the four tokenization models available to Mint NFTs that can engage your audience.
Why Adopt a Tokenization Model for Your NFTs?
As with anything else in marketing, you’ll want to know where your ship is headed before you start steering. Otherwise, you’re meandering in the ocean and using valuable resources. NFTs are such a resource. In the first phase of “NFT 1.0,” we saw a flood of useless tokens dropped without a goal or tied to practical value. But gone are the days of creating and selling NFTs for wild profits without a well-defined value exchange for the holder. Continuing down this path will likely lead to oversaturation and potential mistrust.
With “NFT 2.0,” thinking more broadly about the opportunities that tokens can create or unlock will result in smarter, better experiences for brands and consumers. From test-and-learn to learn-then-plan, treating tokens as engagement tools with utility is a more holistic methodology. With the specific use cases and models, we can accelerate and adapt accordingly.
The 4 Tokenization Models
- Engagement Example: Value Storage
- Cultural Relevance: High
- IP Desirability: High
- Marketing Stage: Awareness
Let’s face it: NFTs as unique collectibles are never going away. They can also serve a number of positive purposes. NFT collectibles have helped raise massive amounts of money for charity and political fundraising. When a brand wants to put out a hot collectible, it will almost always create buzz. And if you’re looking to bring awareness to your audience, it’s a good strategy. Consumers can store their NFTs in their wallets to collect value, and you get a way to tether them to your brand. Aside from being a collectible, you can also use the tokens in other applications, such as within an NFT game. If you’re looking to generate buzz and have a brand asset remain exclusive and valuable, this is an appropriate strategy.
- Engagement Example: NFT as an Event Ticket
- Cultural Relevance: Low to High
- IP Desirability: None to Low
- Marketing Stage: Consideration
NFTs are the new concert ticket. Or sports ticket. Actually, NFTs can be the new access pass to any event. Some trailblazers are taking a more aggressive approach to hammer this in. For example, you couldn’t get into Gary Vaynerchuk’s 2022 VeeCon Conference unless you own or exchange certain NFTs. Most other organizations are more lax with introducing NFTs as access points. Either way, they provide an enormous opportunity to share a piece of brand IP using NFTs, while also providing unique utility.
You can use NFTs to grant access to virtual or IRL events with relative ease. Because it’s a digital token, you can also tie in other benefits to having that access: It could grant unique merch, special content, and more. This strategy gives immediate utility to your tokens while becoming a memorable collectible they keep in their wallet afterward. The token itself doesn’t need to be tied to any cultural item or IP and can be easily scalable.
- Engagement Example: NFTs as Property in the Metaverse
- Cultural Relevance: High
- IP Desirability: Medium
- Marketing Stage: Conversion
Sometimes, owning a token is its own reward. Such is the case for having an NFT as proof of ownership for an item other than a collectible. In the Metaverse and other virtual platforms, NFTs signify property, status, and other owned items. A sword in a virtual game can be an NFT. A deed to a virtual plot of land can be an NFT. So can a receipt for your favorite virtual sweater. In that sense, they are tied to cultural trends and what’s desirable in everyday life.
This strategy mostly applies to an audience already aware of an object and close to a decision. It’s used to convert potential owners to spend. So, what kind of ownership can you give away to your audience that lets them have a bigger stake in your brand?
- Engagement Example: NFTs as Proof of Sale
- Cultural Relevance: Medium
- IP Desirability: Low to High
- Marketing Stage: Retention
This one has potential: The future of how brands and consumers will grow together for the next decade. Loyalty. Rewards. Membership. This is the good stuff — but it has to be earned. It’s not for everyone, and this is where gated segmentation gets interesting. NFTs can also be used to reach a subset of your community. For example, if you have tiers or want to engage certain audiences with specific features, you can leverage NFTs as a doorway to an exclusive group within your brand. In this sense, NFTs can help you differentiate members of the community to maximize engagement and get personal. This type of strategy can be used across the spectrum from low to extremely culturally relevant IPs or products.
Ideally, this tokenization model uses NFTs to keep audiences feeling connected to your brand. You can get as creative as you’d like by providing unique items for different community segments. If one segment prefers a certain product vs. another, you can introduce NFTs based on those interests and develop micro-communities that will likely engage more often with specifically-served content.
Which Tokenization Models Will You Choose?
Here’s the thing: You can adopt different strategies based on projects. They can be combined, planned concurrently or progressively. You can utilize access token NFTs while also creating more niche NFTs to focus on smaller communities within your audience. The technology is flexible and is limited only to your imagination. Figure out your marketing plan first, then use NFTs as an ultimate engagement tool.