Marketing Briefing: When it comes to NFTs, brands should prioritize utility over headlines since ‘consumers don’t care if brands participate’

By Kristina Monllos

Brands are all in on the NFT craze. In recent months, pitches for various NFT activities have ramped up at brands like Acura, Wrangler, Pepsi and others, as they look to use NFTs to get consumers’ attention. (In case you’re not caught up on NFTs, we published an entry into our WTF series on NFTs last March.)

It makes sense. Marketers are always vying for consumer attention and often jump on the latest trend to do so. But some agency execs and industry observers say marketers need to think about utility and brand fit before dabbling in NFTs, as some brands have faced a backlash for doing so, including MeUndies just last week. Rather than chasing a headline by having an NFT, brand marketers need to consider what that NFT can offer, as well as if it makes sense for the brand’s purpose and audience.

“Most brands don’t understand NFTs; most humans don’t – the entire phenomenon is in its infancy,” said a creative director at a creative agency who asked for anonymity. “As with any phenomenon, brands are always quick to jump on top of it and see if they can leverage it to see if they can enhance communications, but more often than not it’s not appropriate.”

Without fully understanding NFTs and the potential to offer something beyond ownership of a JPEG, some marketers may just be seeking out PR mileage – X brand is rolling out NFTs. That mindset is more likely to elicit eyerolls or backlash from consumers, according to agency execs and industry observers.

What would be far more useful, agree those observers, is spending more time and effort getting educated on NFTs and how they could potentially be used for their brand marketing. Brands should also work to “educate customers on what an NFT is and why they should value it” from a brand, notes Dennis Hegstad, co-founder of SMS marketing company LiveRecover, which he recently sold to VoyageSMS.

Hegstad sees the potential for NFTs to grow into brands, selling exclusive products and experiences only for NFT holders, as NFT project Doodles showcased this past weekend at SXSW, more successfully than brands wading into the NFT space.

Given that they likely won’t stop advancing into the NFT space, brands need to think about what they are offering to consumers via NFTs beyond the latest fad or gimmick. “Consumers don’t care if brands participate,” says Brendan Gahan, chief social officer and partner at Mekanism. “They do care about how they participate. Brands need to be adding value.”

Brands should take a “crawl, walk, run” approach to NFTs rather than diving straight in, per Gahan. “The window for novelty participation in this space is over,” he adds. “Big picture: We’re emphasizing the importance of utility. What value are we able to bring? How are we contributing to this community?”