Moving from NFT collectibility to NFT utility
We’ve all seen the tweets. Perhaps even a news article here and there. To some people, NFTs are nothing more than JPEGs on the blockchain.
Sure, static PFPs introduced millions of people to the NFT space (and we’re suuuuper thankful for that). Five years on, however, they’re a world away from what’s actually happening in a fast evolving landscape.
Enter the driver of this change — and our BIG love — NFT utilities. These are transitioning NFTs into a space that offers a high level of added value to holders, specifically through exciting products and services. They help NFTs to reach their full potential, beyond just the way they look.
The best creators are taking things up a notch already by creating bigger (utility-led) visions for their collections. With these in tow, they’re achieving a high level of community engagement and loyalty. In fact, the savviest collections are all about opening the doors and letting communities create utilities for their holders.
So, how’s it being done?
Skipping the cash grab
Seasoned creators know that there’s little point in expecting success from an NFT collection when it doesn’t come with tangible value attached to it. More often than not, the ones that don’t have this end up dead on arrival.
In the past, some lucky creators have gotten away with the “drop and run” approach (minting and cashing in on the first wave of holders only). Most have learned that this is hardly the best way to generate sustainable results. Holders quickly become bored, moving on without giving it a second thought.
A cash grab also devalues how NFTs are viewed by the media and as a result, it skews the general public’s view too. We may even go as far as saying they add to the stereotype that NFTs are nothing more than glorified JPEGs, with little to offer in terms of true value.
Run for president (metaphorically)
Consider for a moment what it might be like if you ran for president.
It doesn’t make much sense to announce your intentions in a press conference on the same day you make the actual decision to run for office. You’ll most likely end up with egg on your face as soon as the first policy-related question is fired your way.
The same logic applies to launching utilities. Campaigns should always start off with a solid plan, ideally with a view towards learning as you go and gradually achieving specific goals.
Many presidents run numerous times before actually being elected. They generate support over time, take any losses along the way in their stride, and continue on with a view towards success later.
In a similar way, talented creatives are playing the long game in the same way in the NFT space. They are actively tapping into specific segments of their audience to gauge what works and what doesn’t.
While there’s no fixed timeline of success of course, going in with the right intention eventually sets you up for the best chance of it. Granted, you probably have a much better chance of creating a thriving NFT collection than being president, but we support your dreams either way!
The real-world usefulness test
A bigger vision for NFT collections should always be able to answer exactly how it will create real-world usefulness for holders. This is the key to individual NFTs transforming into a collection that’s both exciting and valuable.
Before launching a new utility, check whether it passes the test first. There should be multiple stages and phases built into the vision, each of which are well-timed, executed and tracked. You don’t have to do this alone of course - Tropee can help (more on this later).
Getting the artistic side of the NFT ready is only one half of the battle. The business (or strategy) side has to be airtight too.
Physical vs. digital utilities
Utilities are generally split into two types: physical and digital. Creators have a tremendous amount of freedom to explore both in their strategies.
Physical utilities hold real-world benefits to holders, in the form of merch, access to events and so forth. Digital utilities center around bringing the community into the online world of the creator.
There are endless ways in which either type can be used. From exclusive access to events right through to airdrops, there are many functional examples of utilities across various contexts to explore.
Knowing which is best for your brand depends on the needs of the community. It’s easier to start with a campaign when you’ve tried different things before, and you know what they are more likely to engage with already.
If not, you can also draw inspiration from those who have come before you, in order to get the creative juices flowing.
Combining utility types
Over and above going the physical or digital route, it’s possible to combine these utility types within a single campaign too. Some even consider this the birthplace of innovation for any NFT creator.
There are endless possibilities when it comes to what you can create, burying the idea of a “drop and run” NFT launch once and for all.
As you can imagine, managing utilities that combine physical and digital perks is no simple task. Without the right tools for the job it’s likely that the campaign will fall flat altogether.
Ideally, things will run as smoothly as possible so you can focus on inspiring confidence and driving FOMO among the community (both are great for retaining holders, after all).
A focus on community building
Building a solid community is integral to the long-term success of any NFT collection.
Without intrinsic value in the form of utilities, a collection may end up becoming nothing more than a few pretty pictures (but we’re not calling these JPEGs anymore, okay?).
It’s safe to say that a strong community won’t build itself overnight. It’s going to take some trial and error, as well as directly engaging with members to find out exactly what they’re looking for most. In fact, many clever brands are letting users build utilities themselves - harnessing tech like Tropee to open up their world to their communities. Great stuff.
Without that wonderful vision we’ve mentioned, any utilities offered will be forgotten very quickly. Putting in the work consistently will help keep holders interested for longer. From there, a collection may end up growing into something far more lucrative than ever imagined.
Increasing the overall value of NFTs
As standalone entities, NFTs don’t grant any form of direct access to physical and/or digital products and services. They exist only as static files (or “pieces of JPEG art”), predominantly offering aesthetic value.
In this form, NFTs give holders very little to work with in terms of actually doing something interesting with them. It becomes next to impossible to assign true value to them because they aren’t able to do anything functional.
Utilities are fundamental to NFTs moving beyond the JPEG art form, towards the realm of real-world value. They are the gateway to increasing the overall value of NFTs.
With every successful utility campaign, the NFT collection itself also becomes more appealing as a whole. Holders are more likely to spread the word about it, with a view towards staying loyal to the creator in the long run.
Keeping things simple
As a creator, you should be expending most of your energy on actually creating things after all. You shouldn’t have to worry about the logistics around executing and managing your utilities.
The Tropee team loves making life easier in this regard. Tropee gets utilities up and running in no time at all. You don’t even have to design campaigns from scratch (hello, templates!). We’ve got a bunch to choose from already, with more in the works.
The first-mover advantage with Tropee
You’ll be happy to learn that we’ve just gone into public beta, so it’s a great time to get in early and start building utilities for free with us.
We’re happy to offer any feedback you need on your ideas (should you wish), or to make it as simple as possible for you to launch your campaign without worrying about any technical hitches.
Together, we can put the idea of NFTs as simple JPEGs to bed, once and for all.
If it’s that simple, why not?