NFTs and their connection to the world of e-commerce
NFTs are changing the world of e-commerce in a wide variety of ways. NFTs not only make online shopping easier and safer, but have opened up new ways for merchants in various sectors to make money with NFTs at their core.
Read through our guide to NFTs and how they connect to the world of e-commerce. Gaining information about NFTs is critical to helping businesses understand how to sell online more successfully and appeal to increased numbers of users.
What exactly is an NFT?
NFT stands for Non-Fungible Token. NFTs are completely unique digital assets that are designed for trading on a blockchain. A blockchain is a distributed ledger where all cryptocurrency transactions happen, and is an incredibly secure system that is nearly impossible to hack or cheat.
NFTs are used to show the ownership of unique assets that can be anything from a piece of art to a pair of shoes – anything that can be created digitally. The popularity of NFTs has skyrocketed in recent months, and businesses are constantly finding new ways to use this new technology. Usually, NFTs are traded on the Ethereum blockchain, as it has a wide user base and trading is easy to do on this blockchain, although other blockchains are issuing their own tokens at an increasing rate.
In what ways can NFTs change e-commerce?
First, consider how much has changed in e-commerce since 2020. Before the pandemic, many companies had considered online services but had not yet taken the leap, whereas now most companies have at least a basic e-commerce site set up after that it became almost essential during lockdowns and businesses were forced to learn how to sell online.
However, the online market is extremely competitive, so businesses are looking for new ways to reach out to customers and really connect with them. NFTs are perfect for this, as they open up a new avenue of communication with customers and allow them to invest in businesses and even become stakeholders in brands.
So what are the different ways NFTs can be used?
NFTs can be used in so many ways. They allow the digitization of any product, and because they are stored on the blockchain, they are incredibly secure and very easy to track. Originally, NFTs became popular due to gaming and collectibles, but today the possibilities are endless.
Art: Art can be too expensive for most people, so NFTs have opened up a fractional ownership system that means many people can buy a piece of art. This allows artists to access buyers and increase profits.
Sport
Sports: NFTs have given sports fans the opportunity to purchase pieces of their favorite teams as well as iconic moments from sports history. For example, the NBA released a project that allows fans to trade video highlights in a token form similar to a card trading game. These have already gone for hundreds of thousands of dollars.
Music
The music industry is one that is always changing and adapting to new technologies. The introduction of NFTs is no different, and NFTs allow artists to sell their music to consumers as fractional tokens, reducing the need to pay advertisers and streaming services. This can be in the form of mini audio loops or entire tracks. Artists are now allowed to have more control over the branding of their image and can better connect with their communities.
Clothing design
NFTs have allowed the fashion industry to verify an authentic designer through a QR code on the label of the garment. Customers can also see exactly where the factories are located and where the materials come from. This is an extremely effective way to reduce counterfeiting in the fashion design industry as authenticity can be recorded on the blockchain.
Gaming
Players can purchase NFT versions of in-game items across multiple games, such as skins, collectibles, weapons, maps, and more. NFTs mean that these items belong to the player, rather than the game’s developer, and can potentially be transferred between games for use.
How will NFTs change the future of e-commerce?
NFTs are set to change the e-commerce space forever in several ways. Here is a quick overview of some of the most important:
- NFTs can eliminate counterfeiting and fraud
- Avoids restrictions on trade barriers
- Eliminates the additional costs of intermediaries
- NFTs allow for fast speeds and real-time trading
- Allows for shared ownership which can improve the availability of expensive items.
Conclusion
NFTs are changing every industry in unique ways and offer many brand new ways for merchants to make money in a significantly safer and more secure way. The shared ownership option makes expensive products like art available to those who can’t buy the whole thing, and this can really improve the profit margins of sellers, as well as increase the speed at which they sell.
