Luxury, widely known for its desirability, its exclusivity, its crafting tradition, its rarity, is one of the most promising sectors of Web3.0 and more specifically of the advent of NFTs.
These digital objects have come to create new experiences at the service of luxury brands to attract a new generation, innovate, reinvent interactions, at the risk of “breaking” the traditional codes of luxury homes. Given the many opportunities emerging in the Web3.0 ecosystem, how can luxury brands reinvent traditional codes while continuing to share authentic values? How do you differentiate yourself from other brands and not fall into a mainstream approach with no added value?
NFTs: a clear popularity at the service of new experiences.
If some luxury homes are still hesitating, many of them have already taken the plunge. NFT collections, gaming, metaverse, virtual reality… There is no shortage of use cases. Which is interesting to see, in addition to the buzz created by the movement since the popular launches of Louis the Game, the game of Louis Vuitton, of Sharky B, the Burberry shark or even Guerlain and its NFT declines in favor of the biodiversity, are the strategies adopted by every luxury home. Remember that NFTs are unique digital objects that open the way to digital ownership whose value lies in a certificate of authenticity and a host of exclusive benefits.
These strategies are all promising axes for a brand and we can already observe three strategic angles managed by luxury homes. The common denominator is the notion of allowed digital property.
We first observe the NFTs that make it possible to improve a brand’s know-how, either by publishing unique digital assets that represent each detailed component, as Lamborghini has done, or by offering traceability of physical products, such as Breitling with Arianee for example.
NFTs also serve the intrinsic characteristics of luxury. Exclusivity, rarity, limited edition, neat artistic aspect. Properties we find today in most NFT projects that use the hallmark of exclusivity and belong to a small community of privileged people to justify the often high prices of digital assets for sale in the market. In this context, the challenge for the world of luxury is to get it right and transfer the desirability of their products from the physical world to the virtual world. In other words, how can a Gucci or a Louis Vuitton not be surpassed by the new icons of the NFT world that have become the Cryptopunks and the Bored Ape Yacht Club that have become all the stars of the planet?
This time, the luxury homes have decided to test & learn and not wait any longer to observe other sectors. It is not without reason that more and more brands are undertaking a deeper transformation of their organization by focusing on Web3.0 and creating new dedicated business units, such as Balenciaga or Gucci. But beyond the bubble, how to make this transition and succeed in cultivating the two worlds to satisfy a diversified audience in an ecosystem that has its own codes. A real challenge for brands that have to balance their historical identity and the discourse they will implement in the metaverse to conquer new audiences and take their existing community on an adventure at the forefront of ‘innovation’.
Luxury brands have to find the right balance between innovation and authenticity to position themselves sustainably in this ecosystem.
Luxury homes have understood that very well: this time, the turn to Web3 must be taken, if possible well ahead of other sectors, to seize the opportunities presented by this new ecosystem. However, it is not enough to simply launch and spend an initial NFT drop, such a strategy is reflected and built in relation to the overall strategy. Because taking advantage of digital and opening Web3’s Pandora’s box doesn’t mean reproducing in the digital world what exists in the real world, but rather creating new exclusive experiences for an increasingly selective clientele waiting for thrills.
Even if many luxury players have been pioneers, there is still a long way to go to invent real experiences and take full advantage of all that Web3 has to offer, not only on the surface, but also in processes and everything around it. and marketing, as well as business models and the supply chain. To do this, the players who will succeed in distinguishing themselves are those who will establish long-term strategies, both to give themselves time to test and improve their experiences, but also to develop gradually according to the evolution of the market , who is still very young. Finally, the Web3 and especially the NFTs are not a goal, but a means to reach new challenges and a new population, while building loyalty and making the usual customers dream.
In short, the traditional codes of luxury find their climax in the metaverse, bringing surreal experiences to the fore, and the power to invent and offer a true digital experience imprinted with the codes of luxury. Ultimately, especially through its metaverses, the Web3 is an opportunity for the luxury industry to invent or reinvent the industry’s codes in the digital world. A challenge that has not always been successful in the so-called Web 2.0 that we know today. Luxury industry brands that can deliver “luxury” digital experiences will gain significant competitive advantage as this new ecosystem grows.
Thus, the future of luxury homes will be played out in their ability to take the turn of the Web3 by adopting the specific codes of this ecosystem, while integrating the history and identity of their brand. And this to maintain an authentic and unique positioning at the service of a seamless and resolutely innovative customer experience.
Karen Jouve is a Web3 expert, CEO and co-founder of Doors3.