Amazon NFTs signal to Brands that they need to launch their own NFTs soon

February 7, 2023 | Seattle, WA

It is being reported that Amazon, the largest online retailer in the world, with over 300 million active users, 197 million daily visits, and over 150 million Prime users (Amazon's Loyalty Program), is getting into the NFT business. Amazon has long been investing in Web3 initiatives by supporting Crypto and Blockchain companies with cloud infrastructure on AWS and simplifying development with serverless clouds and lambda functionality. Many of the largest Blockchains have partnerships with AWS, have worked with AWS, or are using AWS in some capacity.

A brief history of Amazon

Amazon was founded in 1994, going from an online Bookstore disrupting brick-and-mortar bookstores to the everything store where you can buy just about anything and have it shipped to your door the same day. In the early 2000s, Amazon realized it could offer its server infrastructure that was not being used as a service to technology companies and AWS was born, which is one of the leading digital cloud providers that many companies in the software world rely on.

Amazon is one of the pioneers of eCommerce, a leader and model for Brands and Retailers since they launched their eCommerce in the early days of the internet, arguably the most innovative company in retail technology, and is responsible for evolutions in consumer behavior and the ease of use shoppers have been accustomed to such as one-click-payments via Amazon Pay, same day delivery via Amazon Prime, launching media and content via Prime Television, and selling available cloud storage via AWS which became Amazon's largest business unit.

The role of the Marketplace in NFTs

Amazon is the largest online marketplace in the world and interestingly enough the first wave of NFT adoption involved NFT Marketplaces such as OpenSea, Nifty Gateway, and Super Rare. The NFT Marketplaces focused primarily on digital art and PFP Avatars.

When Brands began to get involved with NFTs, many looked to NFT Marketplaces to launch their first collections, drops, or one-of-ones. To put into perspective major Brands likely have more customers than users on NFT Marketplaces as OpenSea for example is under 2 million users.

Brands prefer to sell their products through their own channels and properties as this allows them to fully own the customer, get first-party data, receive larger margins, and reduce the likeliness of churn for competitive products. As Brands had limited options to offer their NFTs, selling on an NFT Marketplace seemed like the best bet. Since then solutions have become available to allow Brands to sell NFTs directly on their existing commerce platforms such as with Niftmint, which is a Web3 Commerce Wallet and Infrastructure company.

Amazon's NFT Opportunity

NFTs open up opportunities to drive marketing, branding, and loyalty decisions for Brands while providing revenue, business, and customer retention when focused on enhancing existing business offerings.

Amazon could think of entering the NFT industry by having a similar offering to existing NFT Marketplaces or focusing on a highly crypto user, though this would be a big mistake. Since its founding Amazon has made the shopping and consumer experience more and more convenient, so creating a workflow asking its users to download Metamask Wallets and pay for NFTs in cryptocurrency seems highly unlikely. The more likely scenario is for Amazon to abstract cryptocurrency and crypto-wallets while making the purchase functions take place inside of Amazon Pay or your Amazon account.

Five ways Amazon could get started with NFTs

1.) Digital Collectables:

• When Reddit ventured into NFTs, it did so by creating wallets for its users and allowing them to mint NFTs of variations of the Reddit avatar. While Amazon, doesn't necessarily have a mascot, it could release a collectible for Prime Members that could simply be a digital avatar, image, or PFP as an entry point into offering Web3 or NFT experiences. The unlocking of business logic such as access, loyalty, rewards, discounts, etc. can all stem from this initial NFT release given to all Prime Members.

2.) Digital Twins:

• A concept often used with manufacturing and hardware products, Digital Twins also unleashes several opportunities for all physical products that could have a digital equivalent via an NFT. When the concept of Digital Twins is discussed with NFTs the difficulties around crypto wallets and management often get brought up, but assuming Amazon solves for this issue then Amazon users could have an NFT for products they purchase on Amazon. This may not need to be across all items though could be applied to high ticket items such as jewelry, electronics, appliances, computers, cars, etc. which all lend themselves to offering a Digital Twin that could either be included in the sale of the physical good as added value or could be offered as a one-more-sale.

3.) Gaming NFT

• Amazon has planted several flags in the gaming industry with Twitch, Amazon Games, and Prime Gaming. Offering Digital Collectables in the Amazon gaming ecosystems similar to as described above in the Prime Membership lends itself well to this verticle with each gaming user being able to create or select their own avatar they use throughout the platform be an NFT. Web3 base games with characters, skins, and tools/weapons used in games have been touted as in-game NFT opportunities for game developers and their communities. As Amazon has in-house games and a gaming ecosystem, these in-game assets could have opportunities to be interoperable across games.

4.) Partner & Brand Collaboration

• As Amazon has its own private label brands, as well as many companies who highly rely on primarily selling on the marketplace, Amazon has the opportunity to provide exclusivity, private access, limited quantities, or other incentives for specialty branded products. This can also work with larger more established Brands with which Amazon wishes to partner with to bring sales onto their site. For example, say Amazon wanted to have an exclusive product from a high-end fashion house like Louis Vuitton, and by offering an NFT with purchase could incentivize customers to transact. Brand collaborations also introduce new products, product categories, experiences, revenue, and loyalty with NFTs becoming the representation of the partnership.

5.) Events

• Through AWS and its infrastructure services, Amazon has a number of courses, certificates, and events for developers, marketers, and partners who use the Amazon platform. Certification of AWS proficiency is highly important for individuals and for companies looking to partner with Amazon. NFTs could be offered as a certificate of completion or as a commemoration of attendance or participation in an event. While POAPs have become popular at events as a participation NFT, they do not offer an in-network branded experience that can live on Amazon properties but instead offers the POAP in a public application where users of POAPs can collect across any event they attend. Brands and organizations who host events need to own the relationship and experience with their attendee and be able to offer Event NFTs from within their conference, course, or certificate environment.

Lessons for Brands

Let's not forget that when incumbent and legacy Brands in the late 1990s and early 2000s saw Amazon making strides in eCommerce, many Brands decided to stay in their old ways thinking the Internet and eCommerce were a fad. For Amazon to make a team, time, resources, and money investment into building out their NFT strategy is enough of a warning for Brands to start building their own.

Brands can take lessons from the "Five ways Amazon could get started with NFTs" and apply them to their own businesses. NFTs as a product category are still in their infancy and there is no defacto leader or space where average consumers are visiting to acquire Brand NFTs which provides major Brands with the ability to own the narrative and the experience with their customers before an incumbent Brand sets the precedent.

Most Fortune 1000 Brands have dedicated individuals in their organization who are tasked with developing their internal Web3 and NFT strategies.

Just like the Brands who adopted eCommerce and then Social Media continued to have success, the Brands who adopt Web3 and NFTs yet make consumable to their customers will find success as commerce enters its 3.0 era.

Conclusion

With Amazon being the industry and innovation leader in eCommerce arguably since its founding in 1994, it doesn't seem crazy to think the most innovative retail technology company would get involved with the best retail innovation to take place since the smartphone. At Niftmint, we believe "Brands will take NFTs to their first 1 Billion users" and with Amazon getting involved it seems that could happen even sooner.

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About Niftmint

Niftmint makes it simple for Brands to Mint, Sell, and Custody NFTs directly on their site while abstracting crypto and crypto-wallets from the Brand and their Customers via our embedded Nifmint Wallet. Niftmint has productized all smart contracts, wallet creations, token deployments, and transfers while providing a user experience native to traditional Commerce.

About the Author

Jonathan G. Blanco is the Founder and CEO of Niftmint and has been building companies at the intersection of Web3 and Commerce since 2017, working with leading brands to establish, build, and execute Web3 Commerce in their organizations. As a Product and Branding leader, Jonathan has been working with and building Brands since 2009 and has been building retail technology and commerce integrations since 2014. Jonathan has long been an advocate for Web3 always doing so from a product and customer lens to make sure the experience is true to the business need.

Lessons for Brands from Porsche NFT: Put your core customers first

January 25, 2023 | Seattle, WA

Porsche recently launched their #NFT to a highly unfavorable result. After announcing the NFT drop in December 2022 in Miami, the drop early this week was met with criticism from all sides but especially from the NFT and Crypto community saying that Brands need to listen more to them. You can read CoinDesk's opinion and recap on drop here.

Here is the TLDR on Porsche's NFT Drop

Porsche released a 7,500-edition collection of NFTs based on the 911 which is perhaps the most famous car in its offering. In attempting to stick with a Web3 and Crypto native experience, Porsche created an allowlist for people to sign up for access to mint a 911 Porsche NFT for .911 ETH, which at the time of mint was just under $1,500.

The 911 NFTs started finding their way onto OpenSea and were selling below the mint price which led to Porsche deciding to pause the mint at around 2300 NFTs.

Since the mint was paused, the floor price for the Porsche 911 NFTs went up and is currently sitting at 3 ETH as of Wednesday, January 25th.

The Web3 and NFT analysis on the Porsche NFT drop is wrong

By all means, the Porsche NFT can be considered an unsuccessful drop, but not for the reasons news outlets and commentators are saying, especially those in the #Web3 and #NFT community, who by their comments make it clear they have limited experience working with Brands.

Prominent figures in the NFT community and leaders of large NFT PFP projects have been quick to jump on Porsche NFT, thinking if Porsche were only to partner with them the drop would have gone better with many suggesting the NFT needed to be cheaper, be marketed towards the NFT community, welcomed by NFT PFP projects, or that they needed to provide more Web3 education, all of which were not the problem and reason for the poor release.

The issue with the Porsche #NFT drop is not that they didn’t get the #NFT community involved more, as they could have received even less involvement from the NFT community and still had a more successful launch. Fortune 1000 Brands like Porsche do not need the Web3 or NFT community to have a successful NFT launch.

Porsche forgot about its core customers

The real issue Porsche did not find success with the NFT is they did not get the Porsche community involved, as in people who own Porsches or are fans of the Brand. In 2021 alone, Porsche delivered over 300,000 vehicles, in a time of semi-conductor shortages and COVID-19 slowdowns.

Porsche has built an iconic brand since it started building cars in 1948 and there are millions of Porsche owners worldwide. A fan base that is accustomed to frequently attending or participating in car clubs, race teams, and car shows as even listed on their website. The average Porsche owner is over 50 years old and they created an experience for their first NFT that completely alienated this customer.

Keep payments and ownership simple

Brands do not need to be spending time explaining to their customers how to use new payment technology to acquire products and experiences from them. It's up to the Brand to make conversion simple for their core customer base to maximize acquisition, which unfortunately Porsche did not do. Instead of making it simple for the Porsche community to be able to acquire and store the NFTs on a Porsche web experience, they relied on the typical yet heavy #Web3 purchase flows involving crypto wallets and cryptocurrency, even pricing in crypto, all practices their average consumer and fan is not accustomed to and likely won't be doing anytime soon.

The importance of Utility

The utility of an NFT is discussed loosely by PFP projects, boasting promises of future value, experiences, games, etc. as a result of owning a particular NFT. The problem with PFP projects is they often are startups or side projects with small or less mature teams that only have resources as a result of the NFT sale. This is not the case for large brands, particularly with large followings such as Porsche. If Porsche would have focused on its core customer base, it could have unlocked several utility opportunities for NFT holders.

For example, Porsche NFTs could have been offered to anyone who takes a test-drive, anyone who recently purchased a Porsche, or to people who had recently attended a Porsche event. Utility for these Porsche NFTs could have been anything from discounted or free vehicle service, discounted or free car rental in other markets, access to private events, merchandise, higher trade-in value, or any other marketing decision Porsche would have wanted to unlock.

Instead, Porsche did not offer any meaningful utility and expected users to purchase strictly because it's a Porsche NFT and there is nice art. This being said, any company can add utility to an NFT at any point in the future and still have the token be the access point to the experience. As NFTs are essentially digital wrappers around content files, or programable content files, the Token ID and Smart Contract would just be the identifiers which allow access to the token holder to the future product, service, or offering.

What should Brands like Porsche be doing instead or for the next drop?

The most important aspect for Porsche and other Brands considering launching their own NFT collection or Web3 experiences is to make sure it speaks to their core customers and fans in a manner they are most likely to transact and convert. Brands will not have successful NFT collections if they do not get support and understanding from their core customer base and can risk losing their core customers if they begin to feel alienated or as if the brand is no longer serving them.

Five Tips for Brands looking to offer their first NFT

Now that we have established the importance of focusing on your customer, it's time to break down five important items for Brands to consider when releasing an NFT.

1.) Own the Customer Experience

• Just as Brands prefer their customers to purchase products from them directly on their branded website or retail stores, Brands must ensure their customer's purchase, acquire, or are gifted their NFTs on the Brand's channels. Brands are not in the practice of sending their customers to third-party marketplaces over their own websites or retail store

2.) Make Crypto Payments secondary, Fiat Payments primary

• This may sound crazy to those in the Web3 and NFT community, but as mentioned beforehand, Brands must focus on their core customer first. The average consumer is not familiar with how to use cryptocurrency or how to manage a crypto wallet, which should not prevent them from acquiring digital products or experiences from the Brands they love. Even crypto-centric consumers can be hesitant to spend their cryptocurrency to purchase NFTs if the price of the cryptocurrency has been volatile and they don't want to use it at a lower value than what they paid to obtain the crypto.

3.) Custody the NFT for your Customers on your Channels

• If Brands are offering NFTs to their core customer, chances are they trust the Brand to keep their information and products purchased safe. As we have already established that the Brand's core customer is not likely to have a crypto-wallet, the crypto-wallet should not be a barrier to the customer acquiring the NFT. Brands should work with a Web3 technology partner to custody NFTs on behalf of their customers and make them accessible via the Brand's website.

4.) Avoid getting involved in Secondary Markets

• If a Brand does not currently get involved with the secondary market activity of its physical products then NFTs are not the place to start worrying about secondary markets, as it puts Brands in a position to have to manage speculative expectations of growth and profit, which creates a multitude of problems and customer management. Not to mention if a Brand promotes the secondary market or insinuates growth or profits to customers they start to skirt the line of securities laws. Your core customers are less likely to try to flip the products you sell to them.

5.) Launch with scarcity

• One of the greatest benefits of digital inventory is you can create digital products on demand or as needed, therefore there is no need to mint 10,000 NFTs or a high number of NFTs before knowing if the NFT collection is going to be successful. Instead focus on a lower, achievable number and set milestones that will unlock the minting of more NFTs until the high number is reached. This way you can make sure there is not an overabundant supply. In this model, NFTs with lower Token IDs (meaning minted first or earliest) could receive additional offers or perks. Porsche NFT did this unintentionally as a result of the slow start to minting and in doing so create the scarcity that drove the price of the NFT up to 3 ETH when it had been trading at below the mint price. This has seemed to improve the outlook on the NFT launch, though secondary sales should not be a driver in the success of an NFT for Brands.

Brands can have a successful NFT drop and NFT product offering without the NFT and Crypto community if they just focus on their core customer. Niftmint supports Brands with technology and expertise in implementing and executing these five tips for Brands looking to offer NFTs to their customers.

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About Niftmint

Niftmint makes it simple for Brands to Mint, Sell, and Custody NFTs directly on their site while abstracting crypto and crypto-wallets from the Brand and their Customers via our embedded Nifmint Wallet. Niftmint has productized all smart contracts, wallet creations, token deployments, and transfers while providing a user experience native to traditional Commerce.

About the Author

Jonathan G. Blanco is the Founder and CEO of Niftmint and has been building companies at the intersection of Web3 and Commerce since 2017, working with leading brands to establish, build, and execute Web3 Commerce in their organizations. As a Product and Branding leader, Jonathan has been working with and building Brands since 2009 and has been building retail technology and commerce integrations since 2014. Jonathan has long been an advocate for Web3 always doing so from a product and customer lens to make sure the experience is true to the business need.

Web3 & NFT Commerce Predictions for 2023

December 30, 2022 - Seattle, WA

After an eventful 2022 with Brands like Nike, Starbucks, Reddit, Budweiser, Tiffany's and more (Brand Entering Web3 Commerce) taking a step into Web3 and NFTs, 2023 is shaping up to be an exciting year for the world of Web3 & NFT Commerce.

Brands are actively exploring how Web3 and NFTs can lead to revenue, brand awareness and loyalty, and impact their bottom line. The largest and most innovative Brands have dedicated individuals and teams tasked with creating plans internally or seeking out agencies and technology partners.

NFTs

NFTs, which are unique digital assets stored on a blockchain, have a wide range of potential uses, from representing ownership of digital art and collectibles to even physical assets like real estate.

In 2023, we can expect to see even more brands leveraging the power of non-fungible tokens (NFTs) in innovative and creative ways. Here are a few ways that brands might use NFTs in the coming year:

• Creating limited edition NFT collections: Brands can use NFTs to create limited edition collections of digital assets, such as exclusive artwork, music, or even virtual experiences. These NFTs can be sold to collectors and fans, offering a unique and collectible way for brands to engage with their audience.

• Using NFTs for experiential marketing: NFTs can be used to create immersive and interactive experiences for consumers. For example, a brand might offer a virtual reality experience that can only be accessed by purchasing a specific NFT. This can be a powerful way for brands to create a sense of exclusivity and provide a memorable experience for consumers.

• Offering NFT-based loyalty programs: Brands can use NFTs to create loyalty programs that reward customers for their loyalty and engagement. For example, a brand might offer NFTs as rewards for customers who reach certain milestones or levels of engagement. These NFTs could be used to redeem discounts, special offers, or exclusive experiences.

• Using NFTs to represent physical assets: Brands can use NFTs to represent ownership of physical assets, such as real estate or fine art. This can make it easier for brands to track and verify ownership, as well as make it easier for consumers to buy and sell these assets.

• Creating NFT-based charity auctions: Brands can use NFTs to create charity auctions, where proceeds from the sale of NFTs go to support a specific cause or organization. This can be a powerful way for brands to engage with their audience and make a positive impact on the world.

Overall, NFTs offer a wide range of potential uses for brands, and we can expect to see even more innovative and creative uses in 2023.

Other industries and verticles where Web3 will see growth in 2023.

DeFi

One of the most notable trends in 2023 is likely to be the increased adoption of DeFi platforms, which use blockchain technology to enable financial transactions and services. More and more people and businesses are turning to DeFi platforms for tasks such as borrowing, lending, and trading, and this trend is only set to continue in the coming year.

Healthcare, Education, and Government

In addition to these technologies, we can also expect to see the continued development of new use cases for Web3 technologies, such as blockchain and decentralized applications (dApps), in areas like healthcare, education, and government.

Supply Chain

Greater use of blockchain for supply chain management: Blockchain technology has the potential to revolutionize supply chain management by providing a transparent and immutable record of the movement of goods. In 2023, we may see increased adoption of blockchain technology in supply chain management, particularly in industries where traceability and transparency are important, such as the food and pharmaceutical industries.

Regulation

As Web3 technologies continue to mature and gain widespread adoption, regulatory bodies around the world will likely provide clearer guidelines and regulations surrounding their use. This increased regulatory clarity will help to increase confidence in these technologies and facilitate further adoption.

Overall, 2023 is shaping up to be an exciting year for the world of Web3 & NFT Commerce, with a wide range of innovative technologies and applications to look forward to. Whether you're interested in NFTs, DeFi, or the many other possibilities offered by Web3 technologies, there's plenty to keep an eye on in the coming year.

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About Niftmint

Niftmint makes it simple for Brands to Mint, Sell, and Custody NFTs directly on their site while abstracting crypto and crypto-wallets from the Brand and their Customers. Niftmint has productized all smart contracts, wallet creations, token deployments, and transfers while providing a user experience native to traditional Commerce.