When it comes to luxury goods, there are things that NFT cannot capture, such as providing expensive services and feeling things with your hands. As such, fashion brands are betting on a very specific strategy for tokens that combine digital ownership with physical goods..
Coined from one of the key concepts of Web 2.5, phygital describes the process by which the physical and digital realms intertwine to provide consumers with both tangible and virtual experiences. For many entering the metaverse, this is now a familiar way of measuring demand for virtual initiatives. Shoppers buy her NFT and receive a limited edition of her IRL twin that can theoretically experience the best of both worlds.
From Tiffany’s cryptopunk pendants to Nike-owned RTFKT’s “Cryptokix,” the concept of partnering tokens with their physical counterparts has been used to appeal to consumers around the world and, in the process, usher in a new era. is generating hype. Morgan Stanley predicts that the Metaverse could bring an additional $50 billion in sales to the fashion and luxury goods industry by 2030..
Whatever you want to call these objects (badges of honor, certificates of authenticity, or golden tickets), they mark you as part of an exclusive online community. The fact that they can be shown off-line makes them all the more desirable. “Phygital should prioritize how to holistically humanize the customer experience, both online and offline, as a marketing tactic,” said Weny Huang, business developer at digital transformation company UNIFI3D. I’m here.
Without a strong and future-proof digital roadmap for brands, digital twin concepts are likely to flood the market. in one NFT transaction How much energy does a typical American household use in a day, the negative impact on the planet is disastrous. Furthermore, bridging the gap between physical and virtual also means incorporating new and additional manufacturing and distribution avenues that can be costly.
But phygitals hold promising promise. To make the digital twinning process eco-friendly, brands such as digital luxury label Cult & Rain are opting for bespoke strategies to avoid overproduction. Cult & Rain founder George Yang explains: “We see this in the fashion industry as well, where the whole industry is driven by a broken wholesale system that ends up with an excess of clothes. We are seeing a lot of them, and in our case, a strategy that means no inventory at all.”
This limited supply, scarcity ideology may answer the problem of overproduction in fashion and potentially in the metaverse.Jessie Fu, co-founder of digital fashion house Altr_, said: It explains as follows. “This should reduce overall consumption, production and associated transportation costs.” Firms cannot afford to contribute more to an already overworked supply chain, so they are considering entering the virtual space. players should consider such eco-friendly alternatives.
Many people are still skeptical about the concept of new virtual worlds, buthold in exchange The model could, as venture capitalist Nic Carter says, accelerate the mainstreaming of NFTs and provide consumers with a more acceptable entry into Web3. Additionally, the community benefits that accompany some digital twin drops (such as Italian brand Hogan, which has released a range of physical products as NFTs redeemable through its Decentraland-based retail space) and the enduring value and utility of the products. The product stands out due to the customization options that take advantage of the From other goods we buy from the Internet.
As new trends surface, there are always opportunities and obstacles for those involved. For brands looking at virtual realms, there is no need to create NFTs to match proprietary products (they can simply release the product as a standalone item). But as the metaverse continues its upward trajectory, it makes sense for companies to experiment with media and test consumer demand. The key is to consider how these ventures fit into the broader, longer-term DNA of your brand, more like a physical project than a short-term marketing tactic.
Precious Osoba, a strategist and researcher, said, “Many people still have a presence in virtual worlds that somewhat mirror the offline world, and have the same emotional and We are making financial investments.” The future of phygital is just beginning as more and more brands take notice.