WTF is an NFT?

WTF is an NFT?

I originally wrote this article for the April 25th 2021 issue of Campaign Middle East magazine

Unless you’ve been living under a rock for the last few weeks you’ve probably heard people talking about NFTs, or non-fungible tokens – digital files such as images, videos, audio or text files that have recently been changing hands for millions of dollars.

If you have no idea what ‘fungible’ means, you’re not alone.

Essentially, an NFT is a one-of-a-kind digital file that uses blockchain technology to register a unique version of itself – generally considered an ‘original’ or definitive version of any file that, in theory, can be copied an infinite amount of times.

With me so far?

It’s basically a way of manufacturing scarcity using a digital stamp of authenticity. And where there’s scarcity and exclusivity, there’s usually a cohort of people lining up to hand over their cash.

Over the last few weeks a piece of digital art, Beeple’s ‘Everydays: The First 5000 Days’ (pictured above), was sold for $69 million at Christie’s, a cat GIF sold for $560,000, and, in a somewhat meta twist, a New York Times article about NFTs was itself turned into an NFT and auctioned for $560,000 with the proceeds going to charity. In many ways, the buyers of these NFTs are just buying bragging rights, but they also believe that it’s an asset they may be able to resell later.

It might sound like pure alchemy but in tech circles it’s seen as a way to address a problem that has emerged over the last 20 or so years of how to register value for once-tangible assets like art, books, music etc. that now primarily exist in a digital form. NFTs give creators a way of engineering value for a digital asset and making digital collectibles possible. Some creators are already starting to take advantage of the buzz.

Tennessee rock band Kings of Leon was the first band to release an album as an NFT this March with their latest album, ‘When You See Yourself’. The band released three types of NFT of the album, all including exclusive digital artwork, one of which offered a limited-edition vinyl and another that included live show perks like front-row seats for life. A company called YellowHeart developed the smart contracts and intelligence within the tokens and claim to want to “use blockchain technology to bring value back to music and better direct-to-fan relationships”.

Outside music, there has been an explosion in sales of digital-only products recently especially in gaming, from exclusive outfits in Fortnite to various in-game items in Minecraft, Roblox, or any number of other games. Fortnite is a free-to-play game yet generated $1.8 billion in revenue in 2019, most of which came from selling in-game items.

It’s not difficult to see how NFTs might be used to enhance the value of such digital goods – letting platforms effectively create limited editions of items that can be resold and traded, not unlike how an artist might release a limited run of prints of an original artwork.

Brands that sell tangible goods face a steeper challenge in taking advantage of these digital trends, but even some of these guys are getting in on the action too. In March, luxury brand Gucci launched a ‘virtual sneaker’ that can only be worn in digital environments. The neon-coloured digital shoes can be purchased on Gucci’s mobile app from $9 and users can try them on using augmented reality and “wear” them in photographs on social media. Similarly, Nike has patented NFT versions of shoes called CryptoKicks, which allows users to create custom sneakers that may then be manufactured in the real world. In this way NFTs can blur the line between physical and virtual goods, while capitalizing on monetization opportunities in both.

There are a bunch of other ways that brands can get creative like this when it comes to taking advantage of NFTs, from exclusive and limited edition digital content around new products or a physical experience like a concert or sporting event, to even crowdfunding new ideas and products with early customers being able to sell their initial purchase if the concept takes off. While the hype and hyperbole behind emerging concepts like NFTs can make it hard to distinguish the opportunity from the noise, behind most novel ideas is often the possibility of something useful. For NFTs we’ll just have to wait and see whether the emperor has any clothes, digital or not.

Posted by Rob in Campaign Magazine
Joining the Club

Joining the Club

I originally wrote this article for the March 28th 2021 issue of Campaign Middle East magazine

The audio-based social networking app, Clubhouse has exploded onto the social media scene over the last few months on a wave of hype originating from a host of technology enthusiasts, entrepreneurs and investors from Silicon Valley. The app is a kind of cross between radio and podcasts, combining the live nature of broadcast radio, with the topical discoverability and subscription of podcasts.

Users can create “rooms” to host a talk themselves or have a chat with others, and their followers, or anyone that is interested, can listen and even join in with the discussion if the moderator allows, not unlike the virtual Zoom panels that we’ve all become so accustomed to over the last year, but with a social layer on top. Users are notified when someone they follow starts a room and they are presented with a feed of talks that are taking place right then in topics that they find interesting. It has the feel of walking around at a conference being able to duck into and out of a bunch of interesting talks. Moderators can also create “clubs”, which are akin to Facebook Groups where regular meetups can be scheduled and accepted in advance.

Rooms tend to have a very open, conversational feel and, while there is an opportunity to join in with many discussions (not unlike a radio phone-in show), many users admit to listening passively in the background while doing something else. Chats are not recorded and can’t be listened to after they finish, which gives them a sense of urgency and FOMO – join in now or forever miss out on what was said. To create a sense of exclusivity (and presumably to avoid the Fail Whale crashes that plagued Twitter in its early days), new members can only sign-up to Clubhouse if invited by a current user. Each user has two invites to share. An ephemeral nature has helped create an engaged user base and the invite-only sign-up process has only added to the curiosity.

As most of this recent buzz has been fueled by a burst of activity in Silicon Valley, the content on the platform at the moment tends to lean heavily on the US tech and investment scene – users went wild when Elon Musk hosted an impromptu interview with Vlad Tenev, CEO of trading app Robinhood, during the recent Gamestop stock saga. Despite this, as the user base continues to grow and diversify, it’s not hard to imagine how the content on the platform might evolve with more space dedicated to topics such as sports, cooking, health, art, culture, politics – you name it. Users have grown from just 2,000 last June, to over 10 million by March this year, although the app is still only available on iPhone for the time being.

Advertising on Clubhouse

Clubhouse currently does not host any advertising on the platform, but that doesn’t mean that savvy brands can’t get involved. Burger King parent company, Restaurant Brands International (RBI) hosted an hour-long “Open Kitchen” chat with customers the day after reporting its 2020 earnings results in February. CEO José Cil, CMO Fernando Machado and some other executives spoke about the company’s sustainability work and Burger King’s new loyalty program, and they have plans to continue the chats every two weeks.

But there are other ways for advertisers to join in the buzz too. Similar to the way that sponsoring podcasts and webinars currently works, brands can sponsor rooms and get the host to read out a short sponsored message or shout-out during a call, maybe along with some kind of special offer for listeners. Alternatively, brands can sponsor a room or club and have their brand name included in the title of the event so it stands out as users browse through their feed. Some topic-specific clubs are starting to gain a significant following and there could be opportunities for paid guest spots where brand representatives would get a chance to speak to their followers.

While it may feel like there are already enough social media platforms out there, if history has taught us anything, it’s that there always seems to be room for one more. The recent explosive popularity of Clubhouse suggests that this concept has legs. Twitter has recently announced a copycat product called Spaces, and Facebook is also reportedly working on something similar. First-mover advantage can be a real asset when it comes to new channels so brands in the region should start thinking about how they might use a platform like this to get in front of their customers.

Posted by Rob in Campaign Magazine, Social Media
Moderating Campaign Middle East’s AdTech Strategies 2021 Panel

Moderating Campaign Middle East’s AdTech Strategies 2021 Panel

I was delighted to moderate today’s AdTech Strategies 2021 panel for Campaign Middle East. The panelists were from Google, Huawei Ads and MMP WorldWide.

Find out more here and watch it here.

Programmatic after cookies

The cookie is dead. Long live … the what? As Google joins other technology game-changers in their move towards a pro-user-privacy and preference model, programmatic advertising continues to evolve to stay relevant in a world that is now increasingly leaning towards first-party data. Campaign’s panel of industry experts look at the latest updates to programmatic advertising and how clients can make the most of them.

Posted by Rob in Campaign Magazine, Tech
Catch me on this week’s episode of The Prof G Show

Catch me on this week’s episode of The Prof G Show

I appeared on this week’s episode of Scott Galloway’s The Prof G Show with an Office Hours question about Facebook’s antitrust challenges:

With all this antitrust pressure facing Facebook at the moment, do you think there’s any chance that – if they are forced to divest one or more of their assets – Mark Zuckerberg could choose to get rid of Facebook, the ‘Big Blue app’ itself, rather than, for example, Instagram?

Some estimates say that, by next year, Instagram could account for up to 40% of the parent company’s advertising revenue, and this has been increasing significantly every year since Instagram started really generating revenue back in 2015. And with some other beefed-up revenue-generating features like shopping also gaining traction on Instagram lately, it’s maybe not crazy to think that, in the next couple of years, Instagram could end up bringing in more “cabbage” than Facebook itself. With all the controversy around fake news and content moderation on the Facebook platform, it might be starting to seem like more trouble than it’s worth.

So, what do you think – could Mark Zuckerberg ever give up his baby for a potentially greater shot at better future revenue?

Check it out at about the 45:35 mark below to see what Scott had to say.

As a follow-up, I posed the same question to long-time Facebook observer, WIRED Editor at Large, and author of ‘Facebook: An Inside Story‘, Steven Levy, and this is what he had to say.

Posted by Rob in Facebook