With the rise of NFTs, creators and influencers have the perfect opportunity to leverage their brand and expand their revenue streams – but most of them are missing the mark completely.
Non-fungible Tokens, or NFTs, have grown exponentially in recent years – although it’s not all positive. The most expensive NFTs are worth millions of dollars, with digital assets from brands like Yuga Labs ‘Bored Ape Yacht Club, Larva Labs’ CryptoPunk, and more becoming incredibly valuable to own.
NFTs, though, for as much as they have grown, have also become somewhat taboo among skeptics and fans of those who look to utilize them.
Their skepticism isn’t misplaced, either: mistrust in any new technology is likely to happen, but one that breaks banks for what is perceived as no real reason becomes an easy target for accusations of scams, ponzi schemes, money laundering, or really any other variety of financial misdeed.
Content creators getting NFTs wrong
There’s no denying that a number of top influencers have made good money from NFTs, especially those who hopped in early. FaZe Clan co-owner Ricky ‘Banks’ Bergstrom, for example, started his Web3 journey before the industry really started to boom, and as such has an NFT wallet worth at least $ 10m by his own estimates.
For most influencers, though, this is the key reason they have shown any interest in NFTs or blockchain technology in general. While Banks may have plans in Web3 beyond just cashing in on NFTs, many don’t have the same mindset.
There have been numerous crypto and NFT scams from content creators in the last year alone. Earlier in March 2022, Banks spoke out about YouTuber David Dobrik, who was accused of being involved in a $ 6m “scam” through the Bored Bunny NFTs.
“I think it’s worth noting that I didn’t make this mistake only because I’ve taken the time to educate myself,” Banks explained at the time. “A lot of these influencers take deals brought to them by their management [because they’re] treated as a product campaign. ”
Outside of the “scam” accusations that are levied against creators who promote certain NFT projects, there are also those who either create their own cryptocurrency or NFT without full knowledge of what they’re actually agreeing to.
‘Utility’ is an incredibly important word in the world of Web3. It’s key for any NFT project looking to onboard customers or, in this case, influencers looking to leverage their brand with fans, that they have something to offer in return.
The idea that you could simply sell the NFT for more money than you paid for it (dubbed the ‘bigger fool’ model), or simply help said influencer, isn’t enough and does a complete disservice to the fans who support their favorite creators .
This is exactly what YouTube collective Yes Theory found out when they launched their NFT. Fans quickly called them out on it and criticized their decision. Their NFT is meant to fund the post-production of their ‘Project Iceman’ documentary, with said NFT also operating as a ticket to the premiere of the film.
The issue is, that is not rational justification for an NFT by the standards of their viewers. Many of them are, quite rightly, asking why they simply could not have sold tickets as tickets. What use is an NFT in this scenario?
The crucial thing they got wrong was that they tried to implement the technology with no understanding (by their own admission) of NFTs or why they should use it. They did change course and decided to offer just 50% of their tickets as NFTs, but the damage was already done.
Who’s doing it right?
While there are some notable instances where influencers and brands have failed their fans, others are finding ways to make sure their fans benefit.
The NELK Boys, for example, have their FULL SEND Metacard, a membership of sorts for NELK’s followers. The plan for these Metacards is to give owners priority access to merchandise and future NELK brands, including gyms, casinos, and more.
In the world of sports, the London-based organization Fnatic has similar aims for their NFT which, similarly, operates as a membership program. At three tiers of membership, owners can get varying levels of rewards, including merchandise each year, mystery boxes, and “unprecedented access to your Fnatic heroes.” Sports fans are also notoriously reluctant to dip into their pockets usually, but NFTs, if done right, could be a solution to this industry-wide dilemma.
For committed Fnatic or NELK fans, these rewards are unparalleled. After a couple of years, they may well have made their money back simply in the value of merchandise or membership costs, and that’s not including the value of the NFTs themselves.
That, to many, begs the question: Why does it have to be an NFT? Why not just a traditional membership? The fact is, it benefits both parties.
So, why NFTs?
This is ultimately the question that so many people ask when these things crop up. Why do brands and influencers have to make their memberships an NFT?
For creators to better get a grasp of their income and not have to live under the rules of platforms such as YouTube or Twitch, a membership subscription is a logical and fan-friendly solution.
By creating a membership platform as an NFT, both creator and fan can benefit. Rather than ‘renting’ a membership and ultimately losing every asset or advantage when ending the membership – or, alternatively, spending extortionate monthly fees for years on end – the one-off cost of an NFT grants you all the benefits available until you decide to sell your membership, at least offering the opportunity for a return on your initial investment.
The fact is that there are still many NFT and Web3 skeptics across the internet, and that isn’t likely to change in a few years.
When influencers look to utilize NFTs as a way to leverage their brand, the last thing they want – and, often, the first thing many assume – is that it comes across as predatory.
Simply “ownership of a part of the X brand” isn’t enough to justify a fan minting an influencer’s NFT; there has to be some kind of intrinsic reward for being part of an exclusive club. While some know that, many are failing to recognize it – or recognize the opportunities of NFTs for their community at all.