The NFT wave is taking over many industries. Over the last few decades, many enterprises have realized their potential in NFTs. Now, the NFTs have thrown their light on physical items. Brands also realized that NFTs could be an essential marketing strategy for brands; thus, these tokens have ended up as Phygital NFTs. Let’s understand Phygital NFTs, utilities, and their marketplaces.
Going Phygital- Real-time example
To understand the term Phygital better, let’s consider an example.
The brand Tacobell created and sold around 25 taco-themed NFTs at 0.001 ETH, approximately $1.37 at that time. The NFTs got sold out within an hour, and those who bought and sold those NFTs received access to a year of free Taco bells. The resale value then shot up. This put Tacobells on the chart. It increased their sales massively, helped the brand gain more traction, and motivated other brands to include NFTs in their branding and marketing strategy.
So, what will happen if they get forged? Well, with Phygital NFTs, that’s not possible.
What are Phygital NFTs?
The term ‘phygital’ itself would have given you a clue about what it means. Phygital is a portmanteau of ‘Physical’ and ‘Digital.’ The term means digital tokens that back physical items. Since the NFT boom, the Phygitial NFTs have become one of the most sought-after trends. This is also because brands are looking for new ways to reach people and stay relevant in the market.
Phygital NFT marketplace
Phygital NFT marketplaces are platforms where one can trade phygital NFTs. The concept of a mainstream and nascent NFT marketplace, the idea is still an emerging one. Some NFT marketplaces show how the phygital NFTs. However, many brands have already stepped into Web3.0 and yielded profit over a short period.
Use cases of Phygital NFTs
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Building Trust and reliability
Customers can clearly understand the company’s supply chain by incorporating NFTs into their products. NFTs play an important role in establishing the transparency and trust of the brand. The brand can gain goodwill among the customers because the information is built in a blockchain and cannot be modified. The decentralization aspect of the blockchain has been a boon to the brands.
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Royalties
Imagine the mass-market consumer products being sold as valuable collectibles. Every time the product is traded on the platform, one can earn more and more money. This means that the original maker will get a part of the profit. This will be possible if the product is minted as an NFT and has royalty payments in small contracts.
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Protecting the brand
Replicas of well-known luxury brands are quite common. But this can completely tarnish the image of the brand. Though a certificate of authentication will solve this problem, there are chances for that to be forged too. NFTs will help in eliminating this problem. NFTs contains ownership and transferability information of the underlying asset, which can be easily accessed through a blockchain. This provides reassurance to the customers about the purchase they have made.
Understanding the business models
The business model of Phygital NFT is quite an interesting one. Technology has played a very important role in facilitating the concept of Phygital NFTs. Creating an account and crypto stands constant in a Phygital NFT marketplace like any other marketplace. The part where the users get physical products and the NFT they buy makes the Phygital marketplace unique.
Now, what is the relevance? Let’s get this answered. While NFTs can be used for verifying utilities and ownership, the physical items can be used for the actual purpose. The users can sell the NFTs without the physical objects. But, Conditions Apply!
Developing a Phygital NFT Marketplace
- It is very important to develop a user-friendly, cost-effective platform for the users. There are some things that you need to consider before you create a Phygital NFT Marketplace.
- Consider the target audience.
- Choosing the right blockchain platform for the marketplace.
- Opting for the right storage system.
- The overall design and responsiveness of the platform that facilitates the trade are very important.
Final thoughts
A product can stay relevant in the market only if the brand is ready to adopt new strategies and evolve with the changing trends. Keeping the audience engaged with the product is very challenging. However, with the introduction of NFTs, the customers are assured of more benefits and authenticity. This will make the consumers engage with a product frequently. If you consider integrating NFTs with your brand, then now is the time to do it. Many prominent brands have already proven the power of Phygital NFTs through their groundbreaking sale and marketing.
