NFTs Aren’t As Risky as You May Think
How the Era of NFT 2.0 is Building NFT Security and Reducing Risk
You’re likely a marketer or in another brand guardianship role if you’re reading this. Stop us if this train of thought sounds familiar to you:
“An NFT marketing strategy? For brands? I thought they were just for exclusive collectibles? I’m not even sure how they work. Aren’t they still risky to use?”
Indeed, those are all valid questions and concerns. And in fact, a 2021 poll determined that only one in four U.S. adults can describe an NFT — much less how to market or how to make and sell NFTs. (It’s why we demystified them with our NFTs Explained post.) Now, the landscape is changing as people get more acquainted and brands dip their toes in the water by looking into how to create NFTs. And as they become more commonplace, a concern arises regarding NFT security as marketers wonder how risky cryptocurrency is, particularly NFTs. After all, they are a new-ish tech housed within a slightly less-new tech, all taking place within the most freshly-baked iteration of the internet — web3.
That’s a lot of “new” to learn and adopt. NFTs have inevitable staying power, and selling/buying/distributing NFTs can be accomplished with less risk than imagined .But, let’s start with one of the main questions you might have regarding implementing them in your plans: What’s the risk?
Having More Knowledge Can Eliminate Crypto Risks
A lack of education on any given topic can undoubtedly lead to unpredictable events. The same goes for utilizing NFT marketplaces and NFT storefronts. Fortunately, we’re here to help you better understand the technology as a tool and not simply a gimmick. Our solution is to arm you with the knowledge you need to unlock their power and create deeper digital communities. We even created a neat Myth-Busting guide to that effect! (Side note: Yes, NFTs can be sustainable).
For example, your customers don’t necessarily need to own or trade crypto to interact with your NFTs. With platforms like Mint, they can purchase your drops via credit card, like any other ecommerce transaction. This already limits the amount of interaction with crypto that your customers need to buy your NFTs. You don’t even need to sell the NFTs, but can leverage other means of distribution as both incentives and rewards.
4 Ways to Reduce Risk with Tokenized Marketing
When you understand your options and how NFT ecommerce actually works, things become much easier.
1. Vet and trust your web3 technology
The first tactic for avoiding NFT risks is to ensure you’re picking the right technology. This includes your blockchain, wallet, and ecommerce platform. Blockchain is a large “Wild West,” where there are still many unvetted technologies that aren’t suitable for scalability.
- Blockchain — All blockchains are not created equal. Each has its own system of verification, such as proof-of-work vs. proof-of-stake, and its own rules and specialties. It’s essential that you choose an established, vetted blockchain that can support your operations. For example, Mint uses the Flow and Polygon blockchains, which are two reputable and reliable systems that can handle NFTs with ease. Not to mention — they’re environmentally sustainable as well. The energy spent to mint an NFT on Flow is less than running a single search on Google.
- Wallet — Your wallet is where you keep your crypto and NFT tokens. Where brands are concerned, it can be a big indicator of a consumer’s digital identity — a place where you can learn about who they are based on what they own and hold. A reputable wallet technology can ease consumer apprehension by providing a safe place where people can store their cryptocurrency. It offers safeguards against intrusion and cyber tomfoolery. With secure options like Blocto (used by us at Mint), you can feel confident in providing a place to store tokens with minimal risk.
- NFT Marketplace and Storefront — NFT ecommerce requires connecting to secure blockchains and wallets and an easy purchasing experience. Brands can go multiple routes when approaching marketplaces. You can go with an option such as OpenSea, or with something more bespoke. Mint offers a unique, custom NFT Storefront experience that does all of the backend work of managing blockchains and wallets providing an easy ecommerce experience. This type of setup significantly reduces risk as all consumers need to do is purchase their NFT with a card.
2. Introduce utility and value
When we mention the “Wild West” of NFTs, we’re talking about NFT 1.0. This iteration is what most are familiar with — taking advantage of the digital “gold rush” that NFT collectibles provide. In the ensuing chaos, it’s easier to open yourself up to risks by trying to navigate the different blockchains for something valuable. However, we’re all about NFT 2.0, the future of how to make and sell NFTs to establish communities for your brand.
In a nutshell, NFT 2.0 is the era of customizable , tokenized ecosystems in which brands can cultivate digital communities through NFT Storefronts and gated experiences. Instead of a collectible, you’re assigning value to NFTs through their utility. An NFT becomes an exclusive access pass to an IRL event or a ticket to a livestream and community event. And any consumer who holds that NFT gets those privileges. So, go further than simply offering something incredibly colorful and unique — give your NFTs a purpose and role in your marketing strategy so that they remain sustainable. Delivering a value exchange reduces risk.
3. Keep it in your ecosystem
When you go a step deeper with solutions that include an all-inclusive ecommerce NFT experience where people purchase with fiat or credit card, you avoid having consumers directly interact with blockchain technology. In doing so, you’re engaging people with a more secure, comfortable, familiar transaction. That’s why NFT 2.0 is really about using NFTs to build community and provide utility within a closed ecosystem over which you have more flexibility and control.
While there will always be some measure of uncertainty in dealing with digital transactions and finances, you can significantly mitigate NFT risks by building a solid process with credible technology. Mint offers this type of closed, branded ecosystem which provides safe transactions for consumers and secure interactions with blockchain for brands.
4. Attach broader goals and strategies
NFT marketing strategy needn’t be a separate aspect of your overall marketing approach. It should be woven into your plans as another tool that can help you establish a digital presence, introduce products, and build audiences. When you’re confident and educated on the value of NFTs, you can feel safer introducing them. When laddered up to a larger strategy, you won’t have to worry about making a mistake at the cost of brand credibility. That’s because all the NFTs you’d create are bespoke to your objectives, whether they be tied to awareness or conversation.
Keeping in mind the above points will ensure that you enter the world of NFT marketing and branding safely and securely, leading to positive results and new digital communities.