NFTs are changing the world of eCommerce in a huge variety of ways. NFTs not only make it easier and safer to buy online but have opened up new ways for sellers in different sectors to make money with NFTs at the core.
Read through our guide to NFTs and the way that they connect to the world of eCommerce. Gaining information about NFTs is crucial to helping businesses understand how to sell online more successfully and appeal to increased numbers of users.
What actually is an NFT?
NFT stands for Non-Fungible Token. NFTs are completely unique digital assets which have been created for trade on a blockchain. A blockchain is a distributed ledger where all cryptocurrency transactions occur, and is an incredibly secure system that is almost impossible to hack or cheat.
NFTs are used to show the ownership of unique assets which can be anything from a piece of art to a pair of shoes – anything that can be created digitally. The popularity of NFTs has shot up in recent months and companies are constantly finding new ways to make use of this new technology. Usually, NFTs are traded on the blockchain Ethereum, as it has a wide user base and trading is easy to do on this blockchain, although other blockchains are issuing their own tokens at an increasing rate.
In what ways can NFTs alter eCommerce?
Firstly, think about how much has changed in eCommerce since 2020. Before the pandemic, many companies had been considering online services but had not yet made the leap, whereas now most companies have at least a basic eCommerce site set up after it became almost essential during lockdowns and businesses were forced to learn how to sell online.
The online market, however, is extremely competitive, and so businesses are looking for new ways to reach out to customers and really connect with them. NFTs are perfect for this, as they open up a new path of communication with customers and allow them to invest in businesses and even become stakeholders in brands.
So what are the different ways NFTs can be used?
NFTs can be used in so many ways. They allow the digitisation of any product and because they are stored on the blockchain they are incredibly secure and very easy to track. Originally, NFTs became popular because of gaming and collectables, but nowadays the possibilities are endless.
Art: Fine art can be too expensive for most people, so NFTs have opened up a fractional ownership system that means many people can purchase a piece of art in pieces. This allows artists to access buyers and increase profits.
Sports
Sports: NFTs have given sports fans the power to buy bits of their favorite teams as well as iconic moments from sports history. For example, the NBA released a project that allows fans to trade video highlights in a token form similar to a card trading game. These have already gone for hundreds of thousands of dollars.
Music
The music industry is one which is always changing and adapting to new technologies. The introduction of NFTs is no different, and NFTs are allowing artists to sell their music to consumers as fractionalised tokens, reducing the need to pay advertisers and streaming services. This can be in the form of mini audio loops or entire tracks. Artists are now allowed to be more in control of the branding of their image and can connect better with their communities.
Fashion Design
NFTs have allowed the fashion industry to verify an authentic designer through a QR code kept on the label of the clothing item. Customers are also able to see exactly where factories are located and where the materials have come from. This is an extremely efficient way for counterfeiting in the fashion design industry to be reduced as authenticity can be recorded on the blockchain.
Gaming
Gamers are able to buy NFT versions of in-game items on several games, such as skins, collectables, weapons, maps and more. NFTs mean that these items belong to the player, rather than the game’s developer, and can potentially be transferred between games for use.
How will NFTs change the future of eCommerce?
NFTs are set to change the eCommerce space forever in several ways. Here’s a quick rundown of some of the most important:
- NFTs can eliminate counterfeiting and fraud
- Avoids the restrictions of trade barriers
- Eliminates the additional costs of intermediaries
- NFTs allow for quick speeds and real-time trading
- Allows for fractional ownership which can improve the accessibility of expensive items.
Conclusion
NFTs are changing each industry in unique ways and offering lots of brand new ways for sellers to make money in a significantly more safe and more secure manner. The option for fractional ownership allows expensive products such as fine art to become accessible to those who can’t buy the whole thing, and this can really improve the profit margins of sellers, as well as increase the speed at which they are selling.