Eminem and Snoop Dogg love the buzz. In a career spanning thirty years, the two American rappers have never missed an opportunity to make a splash, particularly at major events, and their latest performance at the MTV Awards "Video" just proved that once again. During this television show devoted to the best music videos of the year, the two stars appeared on screen represented by NFTs from the "Bored Ape" collection. For those unfamiliar with the Bored Ape (we'll be talking about them tomorrow in the Premium version), these are monkeys with a totally madcap style, and also the most expensive collection of NFTs in the world. A Bored Ape can fetch several hundred thousand dollars. Before the recent market downturn, some even sold for several million 🤪.
As well as winning a prize in the "metavers" category, Eminem and Snoop Dogg have above all succeeded in establishing themselves a little more as figures in the "Web3" universe. And they're not the only ones. Many other artists, and above all brands, are increasingly positioning themselves in the NFT sector by teaming up with major collections such as Bored Ape.
A few examples: a few months ago, Adidas signed a partnership with Bored Ape and launched a dedicated clothing collection. The CloneX collection is working with French studio RTFKT, acquired a few months ago by Nike, to make limited edition trainers available in the metaverse. A few weeks ago, the jewellery brand Tiffany (part of the LVMH group) launched a collection of pendants featuring CryptoPunks. The price of each pendant? 30 ethers, or around $50,000! And other collaborations of this type are in the pipeline.
"Win-win" The advantage of this system is fairly obvious for brands: they can get a foothold in the Web3 universe without taking on the financial and technological risks of an NFT project. "Launching a collection is not easy. You need technical and marketing skills," explains John Karp, co-founder and chairman of the NFT Factory in Paris. Missing the launch of a collection can also raise questions in terms of reputation...
Besides this serenity for brands, it is above all new communities, and potential customers, that Adidas and other groups come looking for. "NFT collectors are not necessarily the natural targets of brands," says John Karp. "With a collaboration, a luxury or fashion group can broaden its customer base and reach out to a younger audience. This new clientele is all the more interesting given that NFT 'collectors' often have considerable means. According to Dune Analytics, some brands, such as Tiffany, have already generated more than $10 million in sales thanks to NFTs. Nike is even approaching $100 million 💰 !
However, we might wonder about the value of this kind of partnership for NFT collections: what exactly do they get out of it? Quite a lot really, because we tend to forget that NFT collections don't have a business model. The only time they really generate revenue is when the NFTs are sold. But what happens after that? In most projects, the owners of the NFTs have access to very little. And yet "the lifeblood of NFTs is monetisation". How do you maintain the value of NFTs, their uniqueness after launch?" points out Stanislas Barthélémy, blockchain and cryptoassets consultant at KPMG.
The question of monetisation, and therefore partnerships with brands, is all the more important at the moment as markets have fallen sharply. Since its peak at the end of 2021, the NFT market has continued to fall It has lost more than 50% of its value. The collections that have held up best are, unsurprisingly, those that have forged the best partnerships...
