Head to Head: For or Against NFTs
Are NFTs the future of branding, or simply a waste of time and resources? Two of the bright minds at Base Design square-off on this hotly debated and divisive topic. In the red corner, partner Jacques Letesson argues that NFTs have the power to build communities and transform industries. Over in the blue corner, strategist Gaston Lafond explains why brands shouldn’t get involved in such a money-driven and untrustworthy system. Let's get ready to rumble!
The case for NFTs
by Jacques Letesson
For many, NFTs are synonymous with cartoonish images of monkeys, bears, or any kind of animal with approximative aesthetics. For some, they’re just another Ponzi scheme disguised as an internet trend. Fair enough. There is certainly some truth to the narrative and criticism around NFTs, as with crypto, that they are mostly profit-driven and leave almost no room for a vision-driven story.
But if you take the time to dive a bit deeper, to read and listen to the builders, the artists, and the doers, it becomes easier to see the potential of these now infamous Non-Fungible Tokens. They offer game-changing benefits in terms of value creation, community, and utility. So let’s explore each of these plus points.
First up, value creation. Without going into too much detail, the method of tracking and updating the content of a digital asset over time is frankly magical. And because NFTs are run by smart contracts, every asset transaction guarantees its creators a fair and sound payment. Though this new medium may seem futile, it will prove incredibly valuable to both artists and brands, and no doubt trigger massive transformations in the fashion, retail, media, politics, gaming, and hospitality industries.
Many of these transformations will center on community. For years, content delivery and community building have been placed often begrudgingly in the hands of big tech companies. Brands and institutions relied on these platforms in order to reach audiences and find a voice in the midst of all the internet noise. But in that process, user data—your data, your privacy, your history—was the price to pay. You were the product.
With the rise of NFTs (and Web3 in general), there is fresh hope for brands, institutions, and artists alike to acquire new audiences and build strong communities without these data-hungry middlemen or cannibalizing third parties. When you hold an NFT, it creates a bond between you and its creator(s). This bond is a trigger for emotional engagement and a new way to build loyalty over time. It's the purest one-to-one connection you can find on the internet, in which the brand or the artist knows that you are a holder, but doesn't know you personally. In a world where trust is fleeting, NFTs are key to building lasting engagement between creator and consumer.
With that bond in place, the possibilities are endless for brands, and this is where utility comes in. Through NFTs, a brand can drop behind-the-scenes content or a product preview in movie format to customers, or design exclusive experiences only accessible to the token holders, for example. Brands could also provide transparent tracking and provenance monitoring for purchased products or second-hand items. There’s potential to build a community that shares the same dedication to your cause or products. You could incentivize people to recycle, you could inspire new generations… You could simply do things that have not been possible until now.
Another case for the utility of NFTs is that they can bridge physical and digital realms. For instance, a purchase in a brick-and-mortar store could trigger an experience online. When buying a pair of sneakers, the customer may also receive a digital replica for free to be used in their favorite game or metaverse-like world. This twinning process will likely onboard many new consumers into NFTs in the coming years, starting with the luxury fashion market.
It's interesting to note here that some NFT-first projects are becoming, or claiming a place as, brands themselves. Simply put, the Apes and their ilk are not about what they look like, but what they represent. They become tokens of a cultural revolution where like-minded people meet, discuss and build the future of the internet, or purely share common passions and values. During the Ape Fest Night #4 at the recent NFT NYC conference, Eminem and Snoop Dog came on stage to release their new song, clearly showcasing a merger between two worlds. It's a clear signal that a cultural shift is happening. It's not just tech for geeks any more.
So yes, I'm pro NFT. That doesn't mean I’m not aware of the current flaws, abuse and aberration in their usage... But we’re still in the early stages. It takes time for a technological revolution to settle, mature and pave the way forward. Numerous iterations, bad projects, and failures will be needed before we reach mass adoption. Many brands today want to jump on the bandwagon and start their journey into Web3. I get it; it's thrilling. It feels like the next big thing (and I think it is).
But before jumping, these brands should observe, assess and make sure they don't add noise where their users require clarity (which is something we are helping brands to do). It's not solely about adopting Web3 and dropping NFTs; it's about harnessing the value creation, community and utility I just outlined, and developing experiences that prove worthwhile to the users and cement long-lasting bonds, from which all brands can benefit.
The case against NFTs
by Gaston Lafond
Since I have only limited space to tell you the downsides of NFTs and why I think branding shouldn’t get involved into the crypto world, I’ll take two shortcuts to evacuate the technical, legal and political part of the question. The first is the impressive, exhaustive and rightly acclaimed analysis that Dan Olson did of the NFT problem, depicting Non-Fungible Tokens as a half-baked product designed just to give cryptocurrencies a long-awaited (and yet mediocre) substance to exist and grow. The other is Bill Maher’s editorial monologue about Crypto Mania that, besides drawing a rather spot-on parallel between the crypto world and Neverland, brilliantly highlights the contradiction between the posture of the pseudo-progressive tech community and the actual attitude of this community, often short-sighted, puerile and greedy, when not openly anarcho-capitalist.
Now that you’re up to speed, let me explain why I think brands shouldn’t be dealing with NFTs and the crypto sphere in general. At Base, we believe branding is here to build three things: cultural impact, enduring relevance, and resilient realness. It says so on our website. I’ll start with the latter: how can one build resilient realness from a market so erratically inconsistent and so disconnected from the real world? A market where value is built on fake scarcity, where anonymity masquerades as freedom and where trust is disregarded, considered an outdated concept standing in the way of a new transactional paradigm: computerized, unbiased, dehumanized. And how can one build enduring relevance from a system that creates nothing useful, valuable or even entertaining (besides the petty dopamine rush of a casino), and whose environmental impact on an already suffocating planet will make it difficult to make anything endure at all?
Finally, cultural impact, which is a notion dear to our hearts at Base. By cultural impact, we mean earning enough influence (and money, which is not taboo) to leave a mark on the cultural landscape of our times. Why would the NFT community want that? Because cultural impact drives adoption, which the crypto market desperately craves right now if it wants to reach critical mass. Indeed, the advent of crypto is not happening as prophesied, many setbacks have marred the success story, like OpenSea admitting they don’t even know the origin of 80% of their catalog, or infamous crypto heists such as the one hitting Sky Mavis in March, not to mention market constant instability, government regulations or bans, major actors pulling out of the system… etc. As it turns out, crypto entrepreneurs are realizing that trust, clarity and accountability may be valuable assets after all. (Or at least the appearance of it, but let’s not be cynical here…)
So NFTs definitely need to build cultural impact, can branding help them? Sure! With a rather iconoclast and colorful landscape, an outspoken community of early adopters and an inventive glossary creating new words every day, the cultural ground seems fertile enough. But is this actually the true culture of NFTs? What do BAYC, CryptoPunks, Cool Cats, NFTITS, Magic Mushroom Club, Betting Buddhas and all the others really have in common? A price tag. What do NFT enthusiasts keep talking about on Twitter? Buying, selling, earning, pumping, dumping, rates, fees…
Don’t get me wrong, I’m not saying NFTs should be disqualified from having cultural impact because their main purpose is money. Money is also a culture. Money is actually the prevailing culture of our times, and the crypto world is the paragon of this culture, a financial dreamworld where money finally is both the end and the means, artificially growing regardless of value production, market needs, product quality or relevance, workforce skills or effort. Which would be fine in Neverland. But this is Earth. A finite world where actions—no matter how virtual and harmless they seem on a screen—have real consequences on everyone of us, and in this case, no real reward of any sort.
So the question is not so much whether we can build cultural impact for NFTs, but rather: should we? This question makes us, brand designers, reflect on our own place (and cultural impact) in society. A long time ago, we used to be friendly neighborhood artisans having fun crafting logos and slogans for our clients to be noticed, on a global but relatively contained stage. But times have changed. Branding isn’t just about creating the coolest box on the shelf anymore, it’s about creating a superstructure that empowers brands to achieve global influence at all levels and with massive repercussions on everyone’s life. The evolution of our role makes branding a weapon of mass persuasion and mass adoption, and as Peter Parker’s dear uncle said: “With great power comes great responsibilities.” (Yes, I did just compare us to Spiderman.) The question is, are we going to use our branding powers to do good, or to be agents of chaos?