When non-fungible tokens (known as NFTs) – essentially certificates for digital or physical assets – were first launched, the big brands remained unchanged. They didn’t launch their own, poke fun at the trend at the time (now full industry), or rush to revamp previous releases with crypto benefits. People knew there was going to be a Nike NFT one day, but when Nike first showed reluctance, many wondered if the brand and others of similar stature would eventually get in.
Nike then began a string of acquisitions – NFT technology companies, other NFT manufacturers and so on and so forth. And although real-life clothing and footwear is still the giant’s main focus, NFTs are paying it forward, it seems, even if most shoppers (myself included) remain skeptical.
Nike has earned $185.33 million in NFTs so far, beating out Gucci, Tiffany, Dolce & Gabbana and Adidas for the top spot on a new list from Noah Levine listing the top space gainers. Dolce & Gabbana ($25.65 million) took second place; Tiffany ($12.62 million) finished third; and Gucci ($11.56 million) and Adidas ($10.95 million) took fourth and fifth place, respectively.
But these brands aren’t making NFTs for money…even if they do make a whole hell of a lot of them.
Keep in mind, $185.33 million is only 0.3% of Nike’s total annual revenue. As such, the money that Nike makes, for example, is not the main incentive to continue producing or at least promoting NFTs (which are often sneakers or digital apparel), Samuel van Deth, says Oracle’s Director of Marketing Strategy for Europe, Middle East and Asia markets. “I would argue that it’s not the most important metric… the impact on overall brand awareness, engagement, loyalty and lifetime revenue are probably the biggest reasons why brands are investing here.”
Not only are Nike, Tiffany, Gucci and Dolce & Gabbana technically now early adopters, especially if the NFT/crypto market starts to grow again like in 2021, but they are seeing tremendous benefits in NFTs as a marketing tool. Nike recorded nearly 68,000 secondary transactions from its NFTs, which amounted to more than $1.2 billion in secondary volume. Here, that means someone searched with the intention of buying a Nike NFT, but ended up with Nike socks or a Nike T-shirt. By scale, Adidas’ secondary volume, which ranked second only to Nike, didn’t even reach what Nike did from NFTs.
So far, it looks like Nike will remain one of the biggest brands ever, even as we move from real life to the digital world. However, whether he can protect his IP remains to be seen.
