Web 3.0 is a largely mysterious domain for most organizations. It is evolving quickly, and already there are talks about Web 4.0 and even Web 5.0. The reality is that the world is still primarily in a Web 2.5 world—one that is attempting to sense-make what Web 3.0 can offer and figuring out a strategy to cross over to this new realm dominated by one compelling feature—blockchain-based digital asset ownership.
Non-fungible tokens, or NFTs, have been making the headlines, fueled by reports of people paying millions for incomprehensible pieces of digital art and creating hype and speculation for the wrong reasons. As the understanding of NFTs and what they can do becomes clearer, the use cases for these cryptographic tokens will become more apparent, whether they manifest in digital art, game tokens, collectibles or even real-world assets. Organizations looking to integrate NFTs as part of their overall strategy may want to consider these aspects in their planning and execution.
What is it designed to be and what will it do? Instead of jumping blindly onto the bandwagon and creating an entire collection of NFTs with no utility value, pause and examine the reason for needing or wanting NFTs in the first place. Define the strategic intent and then craft a clear-cut road map by laying out the use case and how that contributes to your vision.
For example, is the NFT designed to encourage creativity and engagement from fans? If so, how will you engage the community to participate? The communication and long-term value of the NFT undertaking need to be done properly. The point of the design is to give value to fans and loyal users and reward them for their contributions.
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There are many ways to do this: For example, do you set it up as a DAO (Decentralized Autonomous Organization) and give the power of voting to the fans? Would you integrate the NFT for use in adjacent platforms such as a Web 3.0 game platform?
What is the community-building strategy and engagement plan?
The community is the driving force and lifeline of NFTs. A healthy community is undergirded by high levels of participation through growing the following. It is almost akin to building a culture. A comprehensive social media calendar supporting the NFT strategy is critical—this might include conducting regular Twitter Space AMA (Ask Me Anything) sessions, setting up a Linktr.ee site, posting regular updates on Discord and engaging the appropriate influencers in your business space.
How would you identify your top 10 advocates and engage them to create buzz? Some components to note would be: Does the NFT project revolve around a narrative that the community can connect with? How would the technical aspects of the NFT be done, and do you have the necessary capabilities to carry out the project? The initial narrative is instrumental, and to achieve resonance, you need an iterative process to determine both the traits of the NFT and also its utility value.
Who will work through the technical aspects of the NFTs?
This set of activities requires specialist skills and experience. The first consideration would be the design of the NFTs such as visual, audio and textual elements to file format and file sizes. Then there is the selection of the blockchain the NFT is to be built on and the setting up of the smart contracts. Some key questions to answer are:
- What are the traits and attributes to be attached to the NFTs?
- What is the transaction cost (gas fees)?
- Which marketplace would you launch the NFT project on?
- What components are on-chain or off-chain?
- Are there vestment periods?
Bear in mind the NFT merely indicates asset ownership. Where it can be “used” or traded are key to an NFT’s success. The design should inform the quantity of NFTs to be minted, and the number of rare versus common tokens. If the organization deems that it only has a limited number of viable NFTs that can be created and the attractiveness of these NFTs is very modest, the corresponding cost might not be economically viable to begin with. You should not underestimate the cost of the pre-mint, minting and post-mint expenses.
Pricing an NFT can be a tricky undertaking depending on the nature of the digital asset and its corresponding use case. Working with an established marketplace is essential, and you should also compare the associated fees and commissions based on the services required. Some exchanges are configured to accept a wide array of tokens.
Others are niche or closed exchanges that transact using their proprietary tokens only. Depending on the industry, segment or community you’re in, the choice of a single marketplace or option of different marketplaces can sometimes be bewildering.
Other relevant considerations should include the security practices and the support level for new NFT projects. After minting NFTs, the follow-on, post-mint activities typically include a platform reveal, private whitelisting, releasing NFT teasers and the actual conduct of the private sale and public sale. Promoting the NFT minting event through social media live streaming and leveraging influencers and ambassadors in community-based networks should be part of any NFT public relations and influencer marketing strategy.
Web 3.0 technologies are evolving. Up until now, creating an NFT wallet and connecting it to a crypto wallet contribute to the steep learning curve and adoption. Marketplace support and using technologies that simplify the process for your community and assistance with the road map roll-out are important partnership considerations.
Beyond minting and issuing NFTs, you need a way to sustain value and interest for your NFTs. Maintaining the community is an ongoing job, and you would do well to keep up with community engagement through forums and regular updates. The launch of an NFT is just the beginning—having a robust post-NFT road map is key to its continued success.