Brand Identity in Web3
And so we begin a 3 part series on identity in the metaverse
And so we begin a 3 part series on identity in the metaverse…
I say 3 parts. It will be at least 3 parts, but these are complicated topics, and who knows what I’ll feel like adding in a few weeks.
We’ll start with brand identity because of some recent, interesting headlines. You may have seen the tie-up with Adidas & Prada and Adidas & Bored Ape Yacht Club. Presumably, two of those brands are extremely well known to readers of this newsletter. And the last one only maybe. I’ll get to that.
Prada has a strong brand. So does Adidas.
Our first example, Adidas and Prada worked with digital artist Zach Lieberman to create an NFT based on user-generated contributions. This collab is a well-trodden path for luxury brands, supporting artists doing their thing with some (often-limited) visual tie to the brand. Louis Vuitton wrote the book on this with Stephen Sprouse, Murakami, et al. collaborating on bags. We can see this Prada tie-up as a natural evolution of this marketing effort. I think any accolades beyond that are overblown, “community-oriented” and “user-generated” being thrown around a lot. This is a sportswear giant and a luxury brand selling art to their overlapping, digital-savvy clients. Basta. Not that that’s a bad thing, but I think we should call a spade a spade.
Compare and contrast, dear reader, with the Adidas Originals and Bored Ape Yacht Club (BAYC) collaboration. Bored Ape Yacht Club, to be as succinct as possible, is a collection of digital images of apes, of which there are some that are rarer. People, like Jimmy Fallon and Paris Hilton, use these as their Twitter profile pics. But owning the NFT gives you two other important benefits. One, you are now a member of an exclusive club with IRL parties and its own video game. Most importantly, you are VISIBLY (via your Twitter profile pic) a member of this club. Secondly, you own the IP of that ape. You can think of BAYC as the new marvel universe. I can take my ape and make a comic book and then profit off those comics because I am the owner of this ape, and people are interested in my ape comic because of the surrounding BAYC hype. The company behind BAYC made money from the original sale, but also from every subsequent resale (such is the beauty of NFT smart contracts).
Ok, whew, where were we?
Ah yes, the Adidas tie-up and why it’s truly interesting. BAYC has a massive following and fan club. THE nexus of NFT status and economy. Adidas purchased a Bored Ape for a bunch of money and revamped it into an Adidas Bored Ape, Indigo Herz.
They then released NFTs, which can be used to purchase physical clothing or digital. (this NFT drop was a bit of a shit show, but that’s to be expected when you try something new) The apparel collection is being revealed through digital and physical comic books, created in collaboration with NFT influencer Gmoney, comics series Punks Comics, and of course Bored Ape Yacht Club (BAYC).
Now, this is a little something new and different. Tapping into the BAYC fan community is a real attempt at new customer acquisition. Presumably, there are BAYC fans who are not Adidas fans, and Adidas is buying brand exposure in a very cool and “authentic” way. They’re a sportswear brand, so this alignment with cool feels on point. I would argue they’ve extended their brand into a new customer segment, by playing with their identity and allowing other “brands” into their orbit.
One more example, just for fun and to bring it all full circle. Prada’s Linnea Rossa sponsored a new extreme sports game, Rider Republic. You can compete in your Prada performance wear. The question I’d love to know is, do people who play extreme sports video games participate in extreme sports and thus will possibly want to buy Linnea Rossa ski wear, etc.? I have trouble imagining luxury ski wear tapping into this market, but I’m open to the idea.
Building a brand is no small effort and being confident enough to play with that brand identity out in the wild is even harder. Web3 brand activations need to toe this line delicately, finding a way to acquire or retain customers without alienating their identity. They risk blowback if you enter a community in a way that doesn’t feel authentic, see Balenciaga and Fortnite. But you can’t achieve authenticity without risks, given the nascency of these platforms.
Speaking of risks… Protection of intellectual property in the metaverse is all over the news, as Nike and others rush to copyright for virtual worlds and Hermes continues its legal fight with Metabirkin. But with scams abounding on platforms like OpenSea and no easy way for brands to verify which NFTs are truly authentic, we will continue to see issues. Because of the anonymous nature of NFT sales, uneducated buyers will not be able to verify that an Adidas NFT, which serves as an access token to the limited collection, was actually created by Adidas. It remains to be seen who owns the responsibility to maintain those verification systems. In the physical world, the parallels with eBay are obvious. Who among us hasn’t accidentally bought something fake there? And that’s just the open fraudsters. Nike is now suing online sneaker reseller StockX for allegedly selling unauthorized NFTs of its shoes. Per the complaint, StockX sold more than 500 Nike-branded tokens, without working with Nike.
In short, caveat emptor. Brand identity and protection in the Web3 world is just as hard, if not harder, than it ever was.
Next up - we’ll talk about consumer identities in the metaverse. And what they can/will/should do to craft their identity in a virtual world with (almost) no physical limits. To get it in in your inbox, subscribe.