Why the IP model is the best vertical for NFTs and why they work so well and have transformed the space.
Developing your "cult"
NFTs are one of the greatest mechanisms for creating a cult-like community, and when done well and built by a true brand and business, there are endless possibilities. The entire business model around the most popular IPs to date, such as Marvel, popular anime, and even Harry Potter, is entirely built through visual storytelling, both through screen and text, evoking some sort of emotional attachment with their readers/target audience that hook us for decades. Whether it is through a particular character, world, or memorable time in your life while absorbing that content, an IP is an emotion and art business.
One of the most powerful aspects of the IP model is its ability to tap into pathos, aka the emotional appeal that connects us with a story and its characters. People donβt just care about digital assets for their rarity, aesthetic, or ROI; they care about what those assets represent and how they tie into a broader narrative. NFT projects these days have a tough time developing this narrative and creating emotional depth; however, with Ip companies such as Azuki, community members can find themselves personally connected to the narrative in ways that go above and beyond the traditional narrative of consuming content. You're able to have direct interaction with the characters through storytelling, virtual world immersion, and other dynamic experiences you can't get anywhere else.
Problems when launching
The problem also lies within the monetized vertical you are able to take your brand to the next step with. New projects these days don't have millions in war chests like they used to simply because last cycle, founders didn't need to worry about short-term retention initiatives due to floor prices and ROI being so inflated to where they could only worry about their large activation and plans to scale outside the Web3 echochamber. It was also a lot easier to garner funding with royalties being normalized and imbedded into trading, which only helped the brands instantly scale to where they wanted to be. Due to slower retention spans, geopolitical events, and just an overall lack of trust the community has felt for years, it puts projects in a difficult situation if not prepared to where they may sacrifice these long-term objectives for longevity to maintain floor and community retention. This is why projects NEED to build out a vertical prior to launching their project. As soon as you launch a project, you succumb to instant engagement, often fueled by fear or worry, needing answers and plans for making sure they are taken care of simultaneously. When building prior, it gives creators the focus they've always wanted on creating this emotional connection with their community, to when it is growing at a healthy rate, they can activate these scaled initiatives to bring that growth with them. It is a science only a few have solved post 2021, but I believe it is still more then possible, and now with a lack of volume, the only way it is even possible to bring these KPI revenue goals for large scaling, community NEEDS to be #1.
Direct Contact with Creators and Fans
The most overlooked aspect of NFTs is how they create a two-way conversion system between creators and the community. Being able to have an intimate and direct feedback loop with what you are creating is invaluable in any business. Brining this type of trust and transparency only brings excitement and eventually loyal and emotionally invested backers to what you are creating. These are the only types of backers who will be able to drive long-term success into what you're creating. People feel like they have a voice and, most importantly, are part of a unique and powerful experience. Developing this "family" only comes with trust in you and your product. The most invaluable thing in an IP and NFTs has always been the invisible; the emotional bond you have with what it represents or compells you to feel.
NFTs is not just about owning something rare, but about creating a living and breathing culture that can bleed into the real world. People are starting to realize NFTs are the most human experience you can have on the blockchain when done right and there is a reason for this. Imagine Marvel launching in 2022 thgrough an NFT and instead of reading comics, you can explore the world, have immersive lore, and actually own a piece of the pie as it all unfolds together. The IP model is art already, and when having a rooted emotional and intimate relationship with your audience with flexible tech to immerse them in ways traditional media cannot, you only have a recipe for success.