NFTs have become an area of interest for companies across a variety of industries. They offer a way for brands to establish their presence in the Web3 space. Even during the crypto winter, transaction activity for NFTs has remained high, with mainstream adoption steadily increasing.
Singapore-based homeware brand IUIGA recently celebrated its fifth anniversary with a debut NFT collection, launched in collaboration with tech company AX Studio. Depicting artwork of cartoon jellyfish, the JellyVerse NFT collection was given away to shoppers in August, when they spent S$200 or more with IUIGA.
“The jellyfish design represents the brand’s message of price transparency and quality as well as harmony around the home, directed at their target audience of young homeowners and homemakers,” says Mi Li, head of AX Studio.
Those who obtained three NFTs from the collection would then be able to redeem a Collector’s Special NFT with exclusive privileges. From cashback and early product access to free tarot readings, IUIGA has introduced a host of benefits for its NFT holders.
Beyond this launch, the company has plans to expand its Web3 presence in 2023. IUIGA will explore setting up virtual metaverse stores for customers to engage in an immersive shopping experience.
The NFT effect: increased sales and website visits
“We definitely generated some very positive results from the campaign,” says Li. The JellyVerse collection has set an example of how NFTs can be used by traditional brands as part of a marketing strategy.
[There] was a 300 per cent increase in website visits, three times uplift in orders, and furniture sales also increased by 130 per cent compared to an average week.
– Mi Li, Head of AX Studio
Since the NFT giveaways were tied to minimum spend thresholds — with S$500 needed for three NFTs — 60 per cent of customers were found buying four or more items.
Aside from the short-term sales boost, IUIGA also stands to derive benefits over a longer period of time. With the right steps, the brand could leverage on the JellyVerse collection and strengthen its brand image.
Li believes that the key lies in delivering long-term values which help the price of the NFTs appreciate over time. “As IUIGA builds more and more utility, owners will benefit from the NFT growing in value.”
Along with this, there’s a need for compelling NFT mechanics such as rarity tiers, and a system which involves the community in decision-making.
“[Companies] should engage with consumers to co-build the brand. For instance, deciding the royalty percentages from NFT sales or co-creating new products,” Li explains.
NFTs versus physical collectibles
From a marketing perspective, NFTs appear to be taking the mantle from physical collectibles such as stickers and keychains. While the latter can be traded, they’re one-dimensional and can’t provide as much value to customers.
With NFTs — and the underlying nature of smart contracts and blockchain — you can include other benefits. For example, [users can receive] a percentage of royalties from future sales of the NFT, or they could gain special access to new products and help co-design future products.
– Mi Li, Head of AX Studio
Since NFTs have a “built-in certificate of authenticity”, they make it easier for owners to verify themselves and claim their benefits. This isn’t as easy with physical collectibles, where fakes and copies are more prevalent.
NFTs also provide a dynamic element which helps set them apart. Creators have the option to update the artwork and use it to tell a cohesive story over time.
“For IUIGA, the NFTs can be used as virtual avatars for users,” says Li. “Later on, we could add more accessories and elements to enrich the avatar. That’s quite different from the fixed design of physical items.”
The future of NFT adoption
NFTs only began receiving mainstream attention a little over a year ago. Even though the space has grown significantly since then, it’s still early days for adoption.
“Being an early adopter allows [IUIGA] to get a head-start in building a strategic, long-term business model around Web3 commerce,” says Li.
Whether it’s virtual avatars or a metaverse storefront, NFTs will serve as a gateway to Web3 social experiences. “This is a really exciting time for [brands] to think about an NFT strategy that will truly generate value and help build a loyal community of both Web2 and Web3 users.”
The crypto winter has placed an emphasis on projects with real use-cases and value. NFT collections are no longer succeeding off of hype alone, and users have become more wary of where to invest their money.
“Much of the early interest from consumers surrounded the speculative nature of NFTs. With time and broader mass adoptions, more and more will also think of utility and benefits,” says Li.
The JellyVerse collection is the equivalent of a loyalty program, with customers getting exclusive benefits for shopping with IUIGA. They’re still free to sell or trade their NFTs on a marketplace, however, it’s apparent that JellyVerse offers a lot more than an opportunity for speculation.
Featured Image Credit: IUIGA
Also Read: From Diamond Rings To Furniture: “7-Figure” S’pore Startup IUIGA Is Conquering Many Verticals
