CoinGecko has conducted an in-depth research study where they examined how more traditional companies and brands have been using NFTs.
And it appears that Luxury Goods and Apparel have been dominating the race into the NFT market, with 19 brands out of a total of 52 luxury goods brands that were sampled having launched NFTs. That’s a staggering 36% (over a third).
This is compared to the other closest industries by number, Media, in which only 10 companies sampled had launched NFTs.
Furthermore, the Beverages industry sat at only 5 companies, followed by Food and Staples Retailing at 4, along with Entertainment and Automobiles.
Past this point, the remaining industries have numbers that taper off to 2 and below, such as Personal Products and Leisure Products.
What’s a Non-Fungible Token (NFT)?
An NFT is a digital financial asset that can be traded that frequently includes digital images, videos, or audio data.
NFTs can be transferred, sold, or traded, and they are stored on the blockchain, much like cryptocurrencies. Also, in contrast to cryptocurrencies, are singularly identifiable assets, which is why they are referred to as “non-fungible” assets.
However, it’s important to keep in mind that the NFT market is constantly developing, and businesses are continually learning more about this very hyped-up and hot market. Errors appear inevitable.
NFTs are still seen as a novel and fascinating genre, and some predict that by 2025, the market for NFTs will outpace that for traditional painting.
NFTs have probably been around for ten years, but it has only been in the last 18 to 24 months that they have really taken off. The learning curve has been significant, but adoption has been quick.
Who was included in CoinGecko’s research study?
In order to determine the sector with the highest concentration of companies introducing NFT collections, the study looked at “traditional” brands that have introduced tradeable NFT collections.
The GICS from MSCI was chosen because it offers a thorough industry classification for all enterprises.
These core companies are ones that don’t have a significant original investment in NFTs, crypto, and other Web 3.0 technology.
The data gathered since 2020 accounted for both those companies working on their own or in partnership with another brand and was limited to organizations in the Western world.
This data set does not include:
- Brands that profit from or subtly support other NFT collections
- Brands that release non-tradable, never-traded, or with no trading volume 1/1 NFT NFTs
- Brands have introduced utility NFTs like event tickets
What Industries haven’t launched any NFTs or experimented with them?
Only 11 industries out of 24 in MSCI’s Global Industry Classification Standard were discovered to have tried launching NFTs.
Healthcare, construction, utilities, and real estate are a few of the sectors that have not investigated or experimented with NFTs.
Which Apparel and Luxury Brands have experimented with or released NFTs?
Adidas leads the pack with their Adidas Originals into the Metaverse collection. This NFT collection has an impressive 47,000 ETH in terms of total trading volume to its name. And that’s only within the space of less than a year as it launched in December 2021.
After Adidas, other brands in this market with bigger trading volumes include:
- Dolce & Gabbana,
- and Gucci.
In 2022 though:
- Puma’s Nitro Token and Nitropass,
- Tiffany & Co.’s NFTiff line,
- and other businesses in the apparel and luxury goods sectors
Have already or are planning to introduce new products. The Luxury industry truly is invested in NFTs.
Which Media industry brands have experimented with or released Luxury NFTs?
Among the brands in this market, Time USA’s TIMEPieces NFT collection has the largest trading volume with 10,648 ETH. Fox Corp., Fortune, Reddit, Rolling Stone, and other renowned media businesses with their own brands NFTs are examples.
There are only four to five brands in each of the following categories that have their own NFT collection: beverages, food and staples retailing, entertainment, automobiles, and personal products. Leisure as well as Household Products, in addition to Household Durables and Airlines, complete the list as having only one brand with their own NFT collection.
But why are brands so invested in Luxury NFTs?
Being adaptable is frequently linked to making a change or developing new ideas to keep current as the world changes. Brands are hopping on this profitable bandwagon in the world of luxury.
The crucial question is: What do they stand to gain by doing this?
Executive Professor of Premium Strategy and Disruption at Pepperdine University in Malibu, California, Daniel Langer is the CEO of the luxury brand strategy company Équité.
Daniel spoke to CEO Magazine and according to him, NFTs gives businesses the chance to identify digital assets in a unique way for the first time.
He argued that today, the majority of NFTs have something to do with digital art. There is an obvious connection because luxury has always had a presence at the nexus of culture and art.
This idea of exclusivity has always been there, and luxury firms frequently use purchase history to reward their devoted clients. For instance, Ferrari will only accept orders for a new limited-edition model from customers who already own a Ferrari.
This method is seen as being extended by NFTs, but on a digital platform. The logical next step is to have this represented as an individual, ownable digital token. These collectibles frequently go beyond just offering rewards and incentives to draw buyers in.
Even some of the most prestigious luxury brands have witnessed attempts that failed to attract a sizable audience. When this occurs, brands suffer greater harm to their brand equity than they anticipate.
Luxury Industry is also tapping into the metaverse
More and more companies are hopping on the NFT bandwagon, particularly with the boom in NFT in 2021. Numerous well-known companies are developing their own NFT lines, and some are even dabbling in the Metaverse, such as through the Metaverse Fashion Week.
Find out more about the metaverse and NFTs at Play to Earn Diary.