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A NFT is a digital asset that is purchased and sold through the internet with the help of cryptocurrencies, and lately, people have been investing into them in a huge way, particularly during the peak months for cryptocurrencies.
While it’s a huge thing on the internet, a lot of people still don’t know what NFTs are about.
For beginners, NFTs are Non Fungible Tokens that can be used to represent the ownership of unique items. Basically they’re used in tokenizing things like art, collectibles, and real estate. The ownership of the assets are secured by the Ethereum Blockchain, and when it comes to security, they’re so secure that no one can record the ownership or even copy and paste a new Non-Fungible Token.
Now thanks to how secure they are and how people are investing a lot of money into this technology, businesses across the globe are using NFTs to grow their business.
But how are businesses growing with the help of something that’s mainly known to represent the ownership of unique items?
What Is A NFT ?
Before we talk about anything else, allow us to explain what a NFT is.
NFTs (Non-Fungible Tokens) are cryptographic assets on a blockchain that have unique identification codes and metadata which distinguishes them from one another. NFTs are not allowed to be traded or exchanged, making them different from cryptocurrencies, which are identical to each other, and could be used as a medium for commercial transactions.
Here are some bullet points that would help you understand what NFTs are and how they work:
- Non Fungible Tokens are basically unique cryptographic tokens that exist on a blockchain. Meaning that they could not be replicated in any way, making them one of a kind, however they can be tokenized, which means that multiple people can own parts of one NFT.
- Non Fungible Tokens are not only used for selling expensive “images” on the internet, they could also be used in representing real world items, which includes real estate, artwork and many more.
- Non Fungible Tokens could also be used to represent individuals, identities, property rights and many more.
When it comes to how secure they are, NFTs are pretty safe.
Remember, NFTs use the blockchain technology, making it secure thanks to the distributed nature of blockchains. This makes it pretty hard to hack NFTs, but remember it’s not impossible to hack them. The only security risk for NFTs is that you could lose access to your non-fungible token in case the platform that hosts it goes out of business.
Why Are Brands Using NFTs ?
There are multiple reasons on why brands are using NFTs to promote their business or services, but particularly they use this technology because of the following qualities:
You Get Something That No Else Can Copy
NFTs are extremely secure, and with that, brands are using them to offer something unique in a virtual way knowing that it could not be copied by anyone else.
They Can Help People Earn
One thing about NFTs is that they are not mass produced, which makes them extremely rare, and the thing with rare digital artwork is that it is likely their prices will go up after some time, which can help the owners some money in the future.
They Help Promote Loyalty
When you buy something expensive from a brand and they give you a rare NFT, that automatically makes you feel special, and those that get it have limited-edition NFTs that are only available for selected people, making them loyal.
8 Ways NFTs Can Help You Grow Your Business
You Get To Build Trust And Offer Authenticity
Businesses that are trying to build trust and authenticity amongst their users and customers should start investing in NFTs.
You could start using NFTs to prove that the products and services that you are offering or selling are authentic. Basically, with NFTs, you can offer a digital certificate that would authenticate the products that you are selling or are distributing.
Once you get a digital certificate for proof of authentication, you can prove that your products are legit and are not counterfeit.
Not only that, but this could make the entire process of collecting expensive items easier because you will have digital authenticators that would prove that you are holding something that’s legit and is not a fake item.
You Get To Manage Your Own Supply Chain
Another benefit of using NFTs is that businesses can use it to manage their supply chain.
Small businesses can use blockchain technology to manage the supply chain that they have, which means that they can seamlessly track their products with the help of blockchain technology.
Remember, blockchain allows them to track where the goods came from, who sold it, who delivered it and who bought them before you got everything. In short, you can make use of NFTs to keep track of the supply chain and have an easier time managing the inventory.
Brand Identity And Loyalty
NFTs are heavily linked with brand identity and loyalty, so if you are planning to grow your business with the help of the latest trends, investing into this technology can benefit you in a huge way.
The thing is, customer loyalty programs are a huge thing these days as they are considered to be an effective marketing tool that’s used to create long term relationships with shoppers. With NFTs, the retail market can use them to give tokens or rewards to those that are shopping with them frequently.
Not only that, but NFTs have the power to engage consumers through unique and fun digital related experiences.
Marketing, Investments, Profits And Collections
In reality, you can use NFTs for multiple purposes, which includes the following:
- You can use them as collectibles (good for fashion brands with limited edition releases)
- You can use them as investments
- You can use NFTs for flipping to get massive profits
- You can mint your own NFTs and make money while selling them
- You can use NFTs as funding to start a company
- You can use use NFTs to build a strong marketing campaign for brand awareness
On how it’s being distributed in the market, a report by nonfungible.com, 66 percent of NFTs were distributed in collectibles, 14 percent was in arts, 7 percent was in sports, 7 percent was in the Metaverse, 5 percent was in Games, and only 1 percent was used in utility related services.
A Profitable Investment
Selling your NFTs can help you earn a lot of money, and if you’re a business that’s trying to grow independently, doing this on your own can help you out in a huge way.
You can develop and sell almost anything digital as NFTs. From memes, music, digital art, audio samples, collectibles and even movies, you can sell them at massive amounts of money and earn a lot.
Just remember, in order to maximize the investment that you made, you would be required to monitor the latest trends in the market on a day to day basis, meaning you would have to spend a lot of time analyzing what’s hot and what’s not. Also, the values of NFTs fluctuate a lot, so it’s good to constantly stay active in the market to maximize the profit.
Allows You To Offer Your Digital Services
Another good use for NFTs is that it can allow you to offer your services and products digitally.
NFTs is amazing if you want your customers to access your digital services in a unique way. One of the best examples for this one is you can sell an online course and keep it as an NFT, which means only those that have it can access the services that you are offering.
All those people that hold on to your NFT can unlock the services and products that you are offering. They can also automatically connect crypto wallets with this technology, which can allow them to pay for your services and products that you are offering.
Better Security
Data privacy is prioritized by almost any company that stores personal information of users, clients and customers.
Right now, companies are storing business sensitive information with an extra layer of security in order to avoid data alteration and duplicacy, and with proper implementation of NFTs, accomplishing this task can be done in a better and more secure way.
Also, NFTs are amazing when it comes to offering functionalities like encryption, which plays a huge role in eliminating the risk of forging user data or any unauthorized change in data.
Paperless Management
There are multiple industries in the market that create a massive amount of paper waste, but with the integration of NFTs, it is likely that this problem can be tackled, which can help industries save a lot of money and eliminate or minimize paper waste.
With NFTs, the entire documentation process can happen digitally, which includes the verification process and thanks to the security level that it offers, everything would be stored securely.
Conclusion
NFTs are for sure a good way to use unique digital assets in a modern way. They could be used for brand awareness, in building trust and loyalty, offering collectibles, helping create systems that could make the management of businesses easier and could be used for marketing, investments, collections, and many more.
