After crypto taking a heavy tumble, and NFTs (non-fungible digital tokens) subsequently incurring a bit of bruising, brands and marketers across the globe are taking a different approach to web3 assets and perhaps mixing up the lingo to follow suit – naming them ‘virtual creations’ and ‘collectibles.’
For some of us though, NFTs still conjures a “ya what?” moment that we need to immediately address before we continue.
What is an NFT?
The acronym NFT stands for non-fungible token, which offers little in explanation. It is a type of cryptocurrency; a blockchain-based, non-interchangeable, and unique unit of data or media that is stored on a digital ‘accounts-like’ ledger. It is unique, it can not be replaced, and therefore has monetary value.
They are effectively the digital equivalent of collectibles and despite the rebrand it may be taking amongst other industries – the fact is, in the premium spirits world, the new kid on the block has become a game changer.
How are premium spirits benefiting from NFTs?
We have to go back to go forward. Premium spirits (particularly ultra-premium and rare editions) were facing a number of issues with proof of ownership and authenticity, insurance, transportation and storage – the responsibility falling on distillers and drinks groups to have to facilitate.
With most sales and resales happening in auction houses like Sotheby’s or Christie’s, transport, appraisals, insurance, authentication becomes a burden on the supplier, and the prospective buyer may be limited because they’re unfamiliar with how to get in touch with auction houses.
Enter trailblazing businesses like BlockBar which set up in October 2021, and you’re creating a simpler, and easier way of doing business. Bottles are kept in a safe vault, there’s a significant reduction in transport requirements (therefore unnecessary emissions), and authenticity and ownership can be accessed at a drop of a hat. It probably explains that within a year, there are now more than 300,000 BlockBar users and £5.9m of sales.
What’s interesting is that this fits alongside a larger discussion of the democratisation of luxury, where now more than 80% of BlockBar customers are 25-34 years old. That is an audience that most companies aspire to capture.
And with some bottles selling at £100,000, you all of a sudden introduce more accessible opportunities for fractional ownership. Selling the finest rare vintage scotch at a pricetag of £100k is more achievable if you’re open to multiple owners.
Where previously collectable vintage items have been limited to smaller, more affluent communities, fractional ownership has also opened the market to amateur collectors who can affordably gain access to single-cask trading. Inclusivity at its best!
Are there snags?
Yes, there are challenges in this model. For example, environmental impacts have been highlighted as a negative associated with storage. But surely a bit of teething, presents an opportunity to evaluate environmental durability of bottle design and embellishments.
It’s why it’s so important to work with teams that are specialists in design for manufacturing, so these success factors that go beyond the initial ‘wow’ of creative are given close attention and due diligence.
So… NFTs and premium spirits have commanded attention. There is no gimmick here. It’s delivering solutions.
How can you benefit?
It’s simply a consideration when you are rolling out future collections. Many of our reputable clients choose to release anniversary editions, specific maturation flavours, limited release collaborations or token bottles themselves that give you access to a whole host of additional brand perks.
The ‘special-ness’ of the release qualifies it for investment to deliver visual uniqueness and captivity that compels ownership – quite like creating the ‘haute couture’ from mainstream fashion.
Global whisky brand, Johnnie Walker – for example – has recently partnered with BlockBar, Vayner3 and 88rising to drop an exclusive Johnnie Walker Blue Label bottle and 250 NFT’s. Once purchased, buyers receive an NFT that shows proof of ownership and guarantees authenticity and traceability. It is also privy to a whole host of luxury experiences such as VIP events, signed artwork and private tasting sessions.
The success of a fine quality product part relies on the communication of its attributes, a visual reassurance to customers that they’re buying a premium product.
The brilliant thing is, your only limitation is your imagination. From eye-catching stoppers, cartouches to neck collars and wraps to badges, consumers come to rely on these enhanced embellishments that evoke familiarity with their favourite alcohol brands.
And if you’re stuck, ask us to prepare some useful moodboards for you to get the ideas flowing or arrange a private Signet Creative session to spark some new thinking.
We’d love to find out more about your product or brand and we’d be delighted to arrange a consultation to discuss your product embellishment needs – simply fill in the form and we’ll be in touch.
Alternatively, give us a call on 01733 396080