How Big-Name Sneaker Brands Are Racing Into the Metaverse
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I was first introduced to Web3 through NBA TOP Shot . This solved the problems of collecting and trading cards. I immediately saw the parallel to my early days of surfing basketball and designing forums. My shared interests (and typing!) led to faster connections than my poor verbal skills.
With the power of decentralization, transparency and ownership, Web3 has the potential to solve pain points across the sneaker industry which, in recent years, has faced growing consumer frustration around issues such as affordability and a lack of accessibility. While brands like Adidas and Nike are investing in M&A and partnerships, Web3 offers opportunities for all industry players.
Here’s how it’s set to disrupt this footwear market for the better.
Accessibility issues can be virtually fixed
The sneaker industry faces many challenges, from supply chains to the culture and debt it operates from, but the biggest problem is accessibility. Sneaker enthusiasts are finding it more difficult than ever to get the shoes they desire.
As sneakers have risen into their own asset class — brands like Nike have become increasingly aware they’re in jeopardy of losing their most obsessed customers. Loyalists cannot take too many losses to bots who monopolize product releases before becoming frustrated and leaving the community.
Web3 can be used to make sneaker drops more affordable to consumers who want to wear them, not just make a profit. Web3 gives brands greater insight into who their best customers really are.
Know your customer (KYC) technology for instance can be built on blockchain to create digital IDs that give brands a way to authenticate who is purchasing from their site. Brands can also use social tokens and NFTs to gain insight into their loyal customers.
Right now if Nike releases 50 Jordan 1s in a year — it is possible that one reseller with access to effective bots can buy a substantial portion of those releases and resell each pair for double the retail price. Nike could distribute limited-release sneakers more evenly if buyers were required to have digital IDs that can be linked to one person. It is important to understand your customers and their success rate before you distribute products.
Creating value beyond the point of sale
For too long sneaker enthusiasts have shown loyalty to the brands they love without great returns. Web3 has the potential for that to change. Web3 allows consumers to trace their ownership of brand assets. Companies can then establish a baseline of loyalists and explore ways to reward them beyond the point of sale.
The traditional consumer experience is that you buy your shoes, they ship, and they are delivered. The end. The metaverse allows brands to offer virtual experiences that have real-life benefits. These experiences can be delivered after a product has been delivered.
Service brands are also taking notice of the sneaker market. Sneaker News recently launched the Sneaker News Collector Club, a Web3 community that allows its Discord members opportunities to get closer to the brand by chatting with its editorial staff and readers while offering inside access to new releases. Web3 can help brands identify their best customers and make thoughtful engagements with them.
Related: For Meta or for Worse?
New revenue streams will emerge
Web3 allows brands to create virtual worlds that offer new experiences. Companies of all sizes are being forced into rethinking how they do business.
To wit: Nike recently acquired RTFKT, the biggest NFT player in the sneaker space, which allowed the veteran brand to tap into a virtual new audience, one that might not even want physical shoes (talk about margins).
Adidas went the collaborative route and there have been different responses from the community about who did it right, but the reality is much like the early 90s: there’s no definitive answer.
One thing is certain: if you aren’t investigating Web3 for your company right now, you’re just waiting for another player that does it better.
I have been writing professionally for over 20 years and have a deep understanding of the psychological and emotional elements that affect people. I’m an experienced ghostwriter and editor, as well as an award-winning author of five novels.