How Important Are Gamification and Utility? Very.
In case you‘re just getting into the web3 space— NFTs or Digital Collectibles are the evolution of physical collectibles. Similar to the way eCommerce stores were the evolution of the physical shopping experience… there was a time when we mourned the decreasing popularity of book stores like Barnes and Noble, even as we had our books delivered to our homes (next day) and drank coffee from our own, familiar coffee machines. But if that was it — if it was just that our cherished baseball cards, cardboard-backed comic books, and other collectibles had evolved into digital merchandise —would that be compelling, compelling enough for us to jump into this new thing without hesitation? Probably not.
So what is it that makes this emerging technology, this NFT tech so exciting for collectors and fans alike? It’s that this tech opens the doors to elaborate and immersive experiences — it unveils a world where true engagement can happen. In fact, it is essential that people find happiness, intrigue, excitement and real-world utility in the NFTs they collect. Without gamification and utility, the adoption of things like metaverse and web3 may take a lot longer to gain traction.
We think you’ll agree, gamified collecting is fun and addictive — everytime that coffee shop stamped your card, you couldn’t wait to unlock that free one. And completing that level only to unlock a secret ending…glorious! It can be that way, and in some instances is that way with digital collectibles: Fans who collect certain combinations of NFTs can unlock a wide array of new benefits. This may include gaining access to ultra-rare NFTs as a reward for collecting a specific NFT series, which is something the New York Knicks and Cleveland Cavaliers did during their 2021–2022 NBA seasons. Fans might also be able to mix and match their NFT collections to open up new opportunities, encouraging open-ended, repeat engagement across various brands, teams, and creators and even with each other. This not only strengthens the bond between a fan and their favorite team or the loyalty between a consumer and their go-to brand, but it can also create a sense of community. NFTs + Gamification have the power to establish community and to create those cultural artifacts, those status roles, that secret language…even that secret code word or handshake that keeps people engaged and committed to what’s next.
Quite simply, utility is the happiness derived or paired with an NFT or Digital Collectible… a surprise and delight feature that can unlock an IRL experience such as getting tickets to sit right in front of the glass, floor, or field or a physical item that comes with the NFT or collectible, like with our latest Build-A-Bear drop or when the Milwaukee Bucks paired a Bucks Championship Ring NFT with the real thing. Maybe it’s a token that grants a racing fan the chance to take a lap around the track with a professional race car driver or tour a racing team’s paddock or garage. This is something McLaren Racing offered as part of their NFT release during the 2022 British Grand Prix. There are exclusive events that sports organizations and brands look forward to and plan down to the very last detail. A few lucky fans may have the opportunity to attend one of these as part of an IRL experience and maybe meet one of their heroes as a result.
Another aspect of NFT utility is merch: hoodies, t-shirts, hats, etc. As with IRL experiences, brands, creators, and sports organizations can get very creative with how they offer these types of physical items. Red Bull Racing currently has an NFT program that ties a racing helmet collection with individual pieces of merch like a hat and the potential to win a loot box and more. Interestingly, this type of utility provides a link between collecting the digital and the physical.
Some Final Thoughts
Creating lines of digital collectibles and pairing them with gamified experiences and real-world utility stands to be a major win-win for brands, teams, and creators sports leagues and their fans and consumers, as well as the web3 community. Not only can this bring in meaningful new content for existing fans, but it also stands to galvanize an entirely new demographic of web3 enthusiasts, who are brought into the space, not because of buzzwords, but because the pairing of Digital Collectibles with real-life consumptive items and experiences is so exciting and compelling. In multiple instances, fans of the NFTs have become fans of the brand, team or sport and vice versa. Consider Top Shot — collectors becoming fans of basketball and the basketball fan becoming interested in collecting NFT moments. The there is the degen learning about an established streetwear brand called The Hundreds, not because of their hoodies or hats but because of their NFT project.
Brands who fail to see…or take to long to see the powerful combination of NFT (or Digital Collectibles) with gamification elements and IRL utility may miss a significant opportunity for gaining additional fans and consumers and generating a potentially lucrative revenue stream. First movers stand to benefit the most in this space, as is the case with most emerging technologies, there are a number of early adopters moving boldly to show what’s possible.