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How dynamic NFTs can bring brand engagement to a new level

The first NFT hype cycle may be over, but many brands are embracing the next evolution of the technology, dynamic NFTs. Unlike traditional or “static” non-fungible tokens, which have permanent properties set at the time of creation, dynamic NFTs can change or “evolve” in response to real-world events. This can include anything from the weather, the results of a sports game, or even social media interactions, providing more utility and opening up a whole new world of possibilities for brand engagement.

With dynamic NFTs, brands can create more interactive experiences and more effective loyalty programs. For instance, a fashion brand may create a dynamic NFT of an outfit that changes and becomes more valuable as a customer makes more purchases or interacts with the brand on social media. Or, a beverage brand could set up a dynamic NFT that evolves and unlocks new discounts based on the customer’s location, the weather, or even the time of day.

Dynamic NFTs can change based on any variables the brand decides, and as the NFT evolves, a permanent record of its current ownership and characteristics is stored on the blockchain. Brands can set these triggers programmatically through a smart contract (at the moment the NFT is created or any time after), or they can be based on any off-chain data sources, such as real-world events.

From money grabs to meaningful experiences

Numerous well-known companies have been experimenting with NFT marketing campaigns in recent years. However, with most of these initiatives, the value of the NFT is based entirely on rarity or speculation rather than actual utility. Consumers have grown tired of these types of NFT campaigns, and rightly so. Far too many of them have been a clear money grab, rather than an honest attempt to provide something valuable to customers.

Dynamic NFTs, however, can provide more valuable experiences for customers and fuel longer-term brand engagements. But how can brands use them to achieve this?

Rather than thinking of NFTs as digital assets that can only be bought and sold, brands should consider NFTs as a digital “entry point” (or “access pass”) to their communities. Secondly, instead of setting a price on the NFTs (say, at the beginning of the campaign), brands can give away the NFTs for free whenever the customer purchases a product or service, follows the brand, or signs up to a loyalty program. Then, as the customer (owner of the dynamic NFT) interacts with the brand, the NFT increases in value and can evolve into something the customer can exchange for real rewards. For example, to unlock a new experience or discount.


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