NFTs: an opportunity for eCommerce? (2)

The topic of NFTs or Non Fungible Tokens has quickly gone from being something unknown to the general public to becoming a subject that is beginning to awake considerable interest.

As we told you in the previous post, it is a formula for trading digital goods (or "tokenized" physical goods). The buyer obtains the rights to them and the ownership, which is reflected in a legal way.

Well, we have to differentiate between two important aspects, conditions that must be taken into account before creating - or reinventing - a business model based on this new type of product.

 On the one hand, we have technical determinants, which can represent a challenge for which not everyone is prepared, a brake that can be important.

On the other hand, we will enter into strategic issues that have more to do with marketing than with the technology behind the future sale of NFTs in online stores.

There are undoubtedly many possibilities for eCommerce with this type of non-fungible tokens. Even so, the matter has advantages and disadvantages that, surely, will be polished as time goes by. Let's see what them.

As a result of these similarities comes the conditioning factor we are talking about: NFTs are bought using cryptocurrencies and, like currencies themselves, they are stored in a virtual wallet. In other words, if we want to sell NFTs, we will have to explore these payment methods and gateways.

In order to store these tokens, obviously, user must also have one of these wallets which, in some way, complicates or limits access to a more general target audience.

If we had to fit them into one of the two categories, it would probably be more appropriate to see them as products. But the absence of tangibility may be off-putting to some users.

Crypto collectibles, digital artwork, Internet domains or even tweets... what is for sale is ownership.

We are facing something so different that it is not enough to put it on sale on a website and add a technical description on the product sheet.

Right now, a lot of evangelization and patience is needed to make audience understand what it is, what its advantages are and why they should pay for something that, apparently, has no clear value for many of them.

We have already hinted at this above. Our target audience must have a medium-high or directly high level of technical training. In addition, it is necessary that they have funds in Ethereum, so it gets a little more complicated.

You already know that a niche business is not at all a bad opportunity (often quite the opposite), but it has its determinants in terms of scope and maximum volume of business that can be achieved.

The fact that they are not physical products increases the margin very significantly. Bear in mind that at a logistical level you save all the associated costs in storage, handling, shipping... and even those involved in reverse logistics.

In addition, production costs are infinitely lower than those of any manufactured product.  In this aspect, it must be recognized that selling NFTs is much less expensive than a more conventional business model and, therefore, the economic barrier is much lower at the very beginning.

On this occasion, we are not talking about the most common horizontal ones; Amazon, AliExpress or eBay have not yet entered this world (another plus, by the way).

Even so, there are some alternative marketplaces where NFTs can be bought and sold, such as Opensea.io or Rarible.com. Currently, this is where most of the medium-scale digital business is found, because giants such as Christie's auction house, which has already put works on sale, generating significant profits, are beginning to open up to the new reality.

The reality is that, for the moment, it is somewhat abstract to work with these concepts. However, once you start to get familiar with them, you discover a lot of possibilities. It is somewhat surprising because, in addition to being potentially profitable, it is still uncharted territory where you can be innovative in many different ways.