When non-fungible tokens (a.k.a. NFTs ) — essentially certificates for digital or physical assets — first launched, big brands stayed pat. They didn't launch their own, entertain the then-trend (now full-blown industry) or rush to retrofit prior releases with crypto perks. Folks knew there would one day be a Nike NFT, but when Nike first showed hesitancy, many wondered whether the brand, and others of a similar size, would eventually go all in.
Then Nike kickstarted a streak of acquisitions — NFT technology companies, other NFT makers and so on and so forth. And although real-life apparel and footwear is still the behemoth's primary focus, NFTs are paying it off, it seems, even if most shoppers (myself included) remain skeptical.
Nike has made $185.33 million on NFTs so far, beating out Gucci, Tiffany, Dolce & Gabbana and Adidas for the top spot on a new list by Noah Levine ranking the space's highest earners. Dolce & Gabbana ($25.65 million) took second; Tiffany ($12.62 million) finished third; and Gucci ($11.56 million) and Adidas ($10.95 million) claimed fourth and fifth, respectively.
But these brands aren't making NFTs for the money...even if they make a whole hell of a lot of it off them.
Keep in mind, $185.33 million is only 0.3% of Nike's total annual revenue. As such, the money Nike, for example, earns is not the primary incentive to keep making or at least promoting NFTs (which are often digital sneakers or apparel), Samuel van Deth, Marketing Strategy Director at Oracle for the Europe, Middle East and Asia markets, says. "I would argue it is not the most important metric...the impact on overall brand awareness, engagement, loyalty and customer lifetime revenue are probably the bigger reasons why brands are investing here."
Not only are Nike, Tiffany, Gucci and Dolce & Gabbana technically now early adopters, especially if the NFT/crypto market starts growing again like it was in 2021, but they're seeing incredible gains on NFTs as a marketing tool. Nike recorded nearly 68,000 secondary transactions from its NFTs, which totaled more than $1.2 billion in secondary volume. Here, this means someone went searched with the intent to buy a Nike NFT but wound up with Nike socks or a Nike T-shirt instead. For scale, Adidas's, which claimed second behind Nike, secondary volume didn't even reach what Nike made from NFTs.
So far, it seems like Nike will remain one of the biggest brands ever, even when we transition from real-life to the digital world. Whether it can protect its IP, though, remains to be seen.