While investing in NFTs can give brand access to new data and broader audiences, it is still a nascent and volatile space.
The prospect of investing in non-fungible tokens (NFTs) can prove exciting, given it offers brands possible access to new data and new audiences. Moreover, as brands diversify their marketing efforts further, they are likelier to reach more of the different customer personas they are targeting. Diversification into new channels can also help build a more solid marketing foundation and reduce reliance and the negative impact that occur from other channels.
With an NFT, brands stand to benefit from blockchain technology that creates and attach a unique identifier on the NFT, making the token unique and less susceptible to fraud. Brands can also use two NFTs to develop another unique third NFT. NFTs are also helpful in executing significant business transactions such as transferring private equity holding.
But the use of NFTs has also triggered discussions around the environmental damage or societal cost of misinformation caused by mining cryptocurrencies that are used to buy the tokens. The question around the intrinsic or resale value of NFTs is also yet to be decisively answered. Before experimenting with the technology, businesses need to understand all such implications of the NFT investment.
[10 minute read]
