Advertising isn’t a spotlight industry like 1960’s MadMen anymore. The model, which was centered on the direct-to-eye view - billboards, posters, and unique selling points - has drastically changed.
Queue technology. Advertising and technology have synergized quite well in recent decades. Television has exploded at a greater than exponential growth rate from 1950 to the 1970s. This growth has propelled the television to almost 1 billion units in the late 90s. Advertisers took notice. Ad slots between shows, the Superbowl, and networks with high ratings brought in a frenzy of million-dollar ad slots.
So what is next? With time, technology becomes more efficient. How we “view” alters with time. Before we got our information, whether it was news or ads, it was through material means. This led to a digital world of television in which we received our news or ads. Now we are at a point where computers give us our news or ads.
Now let’s immerse ourselves further into the digital world. Our next technological evolution could be in the form of a metaverse-esque experience, something towards complete immersion. Assuming this will happen, how will ads change and what will be the new model?
I believe this is where NFTs will come in. In a digital world, we need digital rights. NFT’s can service this. This is already being done with brands like Adidas. Currently, NFTs are viewed through the artistic scope of profile picture type collections better known as PFP projects. Through an advertising angle, engaging through PFPs can engage ready-made communities all at once.
Most PFP NFT owners are tech-savvy, share similar interests (art, music, or virtual real estate, etc) and have disposable income. These communities are passionate and attentive. Brand marketers have noticed this. As previously mentioned, Adidas Originals understood this landscape and decided to change its model. They purchased Bored Ape #8774. This gave them instant advertising to an entirely new world of people.
Adidas then created a character named Indigo Herz and partnered with some of the most respected communities in the NFT space to release its own collection. It instantly sold out for $23 million. Those NFTs will act as utility entry tokens to virtual spaces created by Adidas as well as to claim real-world merchandise. In this case, the model for replication is to feed the beast with culturally relevant incentives such as merchandise, memorabilia, exclusive events, giveaways, and access to celebrities and influencers.
But can you alter the model even more?
What if we entered into ad rights within the metaverse. Say an NFT acts as a rights document to stream whatever ad they would like in whatever metaverse space or land the document is linked to. Where I am heading with this is NFTs as a right for advertisement. Companies that buy up virtual land can create their own NFTs as ad rights. these will have royalties that will be paid back to the creator of the NFT while giving the right to stream whatever ad in that space or land.
This model can allow others to buy out those NFTs and trade them on secondary markets. This would create demand for certain spaces which could include more metrics such as metaverse “traffic” into a certain space, or “virtual eyes” if you will. Ultimately this could change the metrics for ad space and trend more towards an efficient space as data will become more readily available of who is actually trafficking into these spaces or land pieces.
As we get more into NFTs we should look at how NFT utility can work in a technical world. Efficiency will always trend higher as technology becomes more abundant and as NFTs are still in a stage of imagination, it is imperative that we think big and think broadly. Advertising is ripe for disruption and NFTs could be the answer.
Written by Theo White