What are NFTs?
2021 was a strange year in many different regards. Young adults with more disposable income due to pandemic stimulus checks gave rise to several different financial breakthroughs, with things like the GameStop and AMC stock buying craze. But one of the year’s biggest breakout crazes is NFTs. NFTs went from being something most people had never heard of to a ubiquitous news talking point and staple of the social media feed. But what are NFTs?
An NFT stands for a Non-Fungible Token, and what they are is unique and non-interchangeable pieces of data stored with blockchain technology. They are typically pictures, gifs, videos, animations, or audio that can’t be authentically reproduced, making them unique. NFTs are considered like pieces of art or collectibles stored through blockchain, which gives them value by making them unique.
NFTs come in a variety of different forms. They can be collectible trading cards of basketball clips, like the TopShop tokens, which are extremely popular. They can be pictures or virtual artwork, one of the most common forms of NFTs. They can be celebrity-endorsed creations, like Paris Hilton or John Cena’s NFTs.
While there isn’t a one-size-fits-all to this craze, what is clear is that for whatever reason, there is a prescribed value to them. NFTs have been sold for exorbitant prices throughout the year, including Everydays: the First 5000 Days, which sold for over $69.3 million in cryptocurrency in 2021. This was the third most expensive artwork sold by a living person, and there was no physical product exchange. The person who purchased it only owns a digital artifact.
While this was the largest NFT sale, it was far from the only one. According to Investopedia, the average price of an NFT on January 1st, 2020, was $24.98. On November 30th, 2021, it is now $913.48. It is a massive market that has rapidly grown in the past year and shows no signs of stopping.
NFTs and Influencer Marketing
You may be wondering what NFTs have to do with influencer marketing, but the truth is, they could very well have some serious ties going forward. For starters, NFTs are a staple on social media. People who create NFTs heavily promote through social media, and one of the biggest ways they do that is through influencer marketing. Keeping up with the rapid changes in the industry from TikTok Influencer Marketing to NFT influencer marketing may be difficult, but this is a trend worth paying attention to.
One of the key ways that NFTs can impact the influencer marketing ecosystem is as a new opportunity for monetization for influencers. Traditionally, this medium has been dominated by advertising revenue as the primary source of income for influencers. But for major social media superstars, creating NFTs of Instagram photos or tweets and selling them to fans is a new source of revenue that should be taken seriously.
This will be a significant opportunity for influencers, but it can also be a major opportunity for brands or an influencer marketing firm. If a business is launching a major campaign with an influencer they’ve partnered with, one unique and exciting way to market could be creating a sponsored NFT with the influencer. The technology that creates these collectibles will only become more widespread, and it is a great way for brands to stand out. This is a new format for influencer marketing that could become popular in the future.
There are already countless amounts of influencers involved with NFTs. Influencer marketing of NFTs is currently a rising medium. If you see your favorite influencer posting a cartoon picture that looks straight from the album artwork of The Gorillaz, don’t be confused. That means they are marketing a new NFT. NFTs are a significant new technological and cultural advancement that many people appear to be engaged with. According to The Harris Poll, 27% of millennials invest in NFTs. It is a rising trend that influencer marketers should be paying attention to.
What Does the Future Hold?
Projecting the future is where things begin to get speculative. As it stands, there are opportunities for influencers and influencer marketers to take advantage of this new craze. Where it will go from here is hard to know. The question remains if NFTs are just some passing trend that will lose its merit quickly. There is no intrinsic value to a virtual picture of something. The value is based on its “uniqueness” and the prescribed value we’ve placed on it. That doesn’t mean that value will disappear; it just raises some questions about its longevity.
However, in a world where the metaverse appears set to take over, where cryptocurrency has shown that blockchain and virtual assets have real-world value, it wouldn’t shock anyone to see NFTs continue their growth. The influencer marketing world is deeply tied into trends and what is popular, and that means that NFTs have a role to play in the industry’s future if they can maintain their value.
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