The illusion of web3 innovation in large consumer brands | Opinion

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As a crypto investor and someone who has closely followed the intersection of consumer brands and web3 technology, I have come to the disappointing conclusion that large brands have not yet delivered on the promises of decentralization and digital ownership in a meaningful way.

Last month, there were rumors circulating that Nike was considering closing down RTFKT, the groundbreaking digital sneaker label they bought for an astounding $1 billion in 2021. Fortunately, these rumors proved to be unfounded. However, they sparked a more profound reflection: Has web3, with its claims of decentralization and digital ownership, genuinely benefited consumer brands? My response is a clear-cut no.

Consumer brands with a large customer base often struggle to adapt and innovate in the new digital landscape due to their inflexible and risk-averse nature. They’ve merely incorporated web3 technologies superficially, primarily for short-term financial benefits instead of truly integrating these advancements into their core operations. As a result, they have yet to discover significant success in the market by offering products or services that resonate with consumers in this new paradigm.

The failure of large brands to innovate

As a crypto investor, I’ve noticed that large consumer brands have a tendency to be slow in adapting to new technologies. Companies like Kodak, which was once a pioneer in digital photography, clung to their traditional film business and missed out on the digital revolution. Similarly, Blockbuster ignored the rise of online streaming and paid the ultimate price. Today, I see similar patterns repeating with web3. Big brands are dabbling in NFTs and blockchain, but their approach is superficial and reactive to market trends rather than driven by a genuine desire to innovate. This shallow adoption lacks the depth and understanding necessary to fully harness the potential of web3.

From a philosophical standpoint, the lack of innovation in large corporations can be attributed to their inherent characteristics. These organizations are intentionally hierarchical and centralized systems that value stability and certainty over novelty and risk. In Deleuzian terms, they embody rigidly structured, inflexible environments. In contrast, Web3 signifies a domain of decentralization and adaptability. It is unsurprising that established brands struggle to adapt in this realm as it goes against their fundamental nature.

The superficial adoption of web3

Nike’s acquisition of RTFKT was seen as a daring step into the digital world. However, despite the initial buzz, Nike has faced challenges in merging its creative vision with its overall business strategy. The recent speculation about shutdowns serves to highlight a deeper problem: major corporations enter the web3 technology sphere primarily for financial gains, not authentic innovation. Consequently, we’ve seen a string of lackluster initiatives that fall flat with consumers.

As an analyst, I’ve come across the observation that the surface-level application of technology, such as Nike’s case, is not unique to the brand. Regarding Louis Vuitton’s implementation of blockchain for product authentication, it aligns with their luxury and authenticity image; however, its influence on consumer engagement remains minimal. In essence, this use of blockchain can be seen more as a marketing ploy than a genuine innovation. It is a superficial representation of progress, lacking the substance and significance that true transformation brings.

Louis Vuitton’s NFT ventures

Louis Vuitton has introduced several noteworthy NFT (Non-Fungible Token) projects, with the most prominent being “Louis: The Game,” a mobile application launched to commemorate the luxury brand’s 200th anniversary. In this interactive game, users collaborate with the mascot, Vivienne, in gathering NFTs created by the celebrated artist Beeple. The objective is both educational and entertaining, aiming to foster connections between players and Louis Vuitton’s illustrious heritage. However, despite garnering over two million downloads, the extent of consumer engagement remains uncertain since these NFTs are non-transferable and serve mainly as collectibles rather than offering broader functionality.

In their latest project, Louis Vuitton unveiled the “VIA Treasure Trunk” NFTs for sale, each costing around $41,000. These NFTs come with real-life trunks and grant privileged access to customized items and exclusive previews, catering to the luxury label’s high-end clientele. This strategy underlines Louis Vuitton’s emphasis on exclusivity over making digital ownership widely accessible.

The true potential of web3

As an analyst, I’d rephrase the text as follows: I believe Web3 holds great potential for democratizing digital interactions and ownership. Yet, this promise remains largely unexplored by larger, more bureaucratic brands. The true innovators in this space are smaller, agile companies like 9dcc and RTFKT. These trailblazers, such as 9dcc founded by crypto entrepreneur Gmoney, are integrating NFTs into high-end fashion, merging digital and physical experiences in a way that truly resonates with consumers. By experimenting with new models of ownership, community engagement, and digital experiences, these companies are pushing the boundaries in ways that larger brands can’t or won’t.

In a way, these smaller entities function as nomadic explorers in the expansive digital landscape of web3. Unencumbered by the rigid frameworks of traditional corporate structures, they are free to roam and discover the infinite possibilities of this emerging frontier. Adopting the philosophical perspective of Deleuze, they epitomize the rhizome – a decentralized, non-hierarchical network that can sprout and evolve in any direction.

The future of web3 and consumer brands

To realize the complete potential of web3 in consumer applications, it’s the trailblazers among smaller innovators who must take the helm. They are the ones relentlessly exploring new technologies, testing boundaries, and devising authentic methods to connect with consumers. Meanwhile, established brands should acknowledge their constraints and consider seeking guidance from these forward-thinking pioneers.

Web3 goes beyond attaching a Non-Fungible Token (NFT) to a product; it’s about fundamentally transforming consumer interactions. The focus shifts from mere ownership to active engagement and value generation. Brands that fail to grasp this concept risk falling short, preventing the full potential of web3 from being unlocked.

The philosophical message is evident: the future lies with those adept at maneuvering through the unobstructed digital landscape of web3, rather than those rooted in the rigid frameworks of the past. It’s for the wanderers, the interconnected thinkers, and the pioneers who aren’t deterred by the risk of failure. They are the ones who grasp that genuine innovation isn’t about monetary profits but about expanding the limits of what exists.

As a crypto investor, I’ve come to realize that the reluctance of large consumer brands to adopt web3 technologies underscores an essential truth: investing money is not enough for innovation. A pioneering spirit, a readiness to take calculated risks, and a deep comprehension of the technology are equally important. Until these established players shift their mindset, the future of web3 will be shaped by the visionary, the agile, and the genuinely groundbreaking projects.

As an analyst, I would rephrase the question as follows: It’s not a matter of if web3 will revolutionize consumer experiences, but rather who will lead this transformation. In my opinion, the answer is the small and agile entities within the decentralized, dynamic, and infinitely innovative realm of the web3 world. They have the unique opportunity to grasp the future and shape it according to their vision.

Gleb Sychev

As a multidisciplinary creative and marketing expert with a background in the art world and web3 innovation, I, Gleb Sychev, am currently taking on the entrepreneurial role of founder and CEO at Swarāj, an avant-garde beyond-fashion brand that’s pioneering the concept of phygitalization. In addition to leading Swarāj, I also co-founded The Selfrule Organization, a forward-thinking enterprise focused on research and development in various emerging technological fields.

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2024-06-21 17:49