- The Ground Floor
- Nike's Web3 Gaming Strategy
Nike's Web3 Gaming Strategy
Breaking down Nike's Web3 strategy to onboard gamers to .SWOOSH...
In today’s edition of the Ground Floor we will be breaking down Nike’s Web3 gaming strategy…
.SWOOSH ~ The Trojan Horse
Web1 ~ Users can read content on the internet.
Web2 ~ Users can read and write on the internet.
Web3 ~ Users can read, write, and own assets on the internet.
Said differently, the promise of Web3 is an evolution of the internet whereby users can own native internet assets.
As we have explored in prior editions of The Ground Floor, the most promising use case for Web3 in 2023 is digital art, however, one use case that stands out as a potential path to onboard many new people to Web3 is gaming.
🎮 Why Gaming?
Today, many of the most successful video game developers generate revenue by selling in game assets, however, users are unable to re-sell these in game assets.
To be clear, this model works extremely well as by monopolizing the sale of in game assets companies such as Fortnite can build incredibly lucrative businesses ~ with Fortnite alone generating over $6 billion in revenue in 2022.
Here lies the (potential) opportunity…
One of the primary perks of NFTs is the freedom to transact, and the ability to list your assets on any marketplace of your choosing.
If game developers were to adopt NFTs users could in turn choose to sell their in game assets if they were to move onto a new game.
The problem this presents is that game developers have every incentive to avoid incorporating NFTs into their games as to do so would very likely reduce the revenue they generate from the sale of in game assets.
Additionally, despite this potential path for gamers to re-sell in-game assets ~ the majority of gamers remain very much against NFTs.
This is likely an education issue above all else as the public perception of NFTs is largely people paying egregious amounts of money to purchase digital assets, however, it remains a hurdle to successfully integrate NFTs into video games.
The Good News
Despite both of these obstacles, there remain reasons to be optimistic.
Earlier this week, Nike’s Web3 division .SWOOSH made a massive announcement whereby they would be partnering with Fortnite, one most popular game in the world with 70+ million monthly active users.
The devil in the details…
Today, game developers aren’t too keen on incorporating NFTs into their games, and gamers aren’t exactly excited about NFTs.
To overcome these hurdles, .SWOOSH came up with a very creative solution.
First, and foremost they focused on providing value to gamers in the form of an opportunity to claim an in-game asset, free of charge in return for players spending 10 minutes or more in Nike’s branded game inside Fortnite.
(Nike’s in game Fortnite experience)
User acquisition strategy…
To overcome the obstacle of not being able to offer NFTs inside of Fortnite, .SWOOSH is cleverly persuading players into its own platform.
In return for players linking their Epic Games and .SWOOSH accounts, players will receive first access to a future .SWOOSH Air Max virtual collection.
Throughout this entire user flow, .SWOOSH doesn’t mention NFTs a single time.
Instead, they focus on appealing to gamers with the prospect of receiving early access to a digital asset ~ thus eliminating the need to educate players on NFTs.
Why This Works So Well
The easiest way to onboard gamers who are skeptical about NFTs is to create digital products that appeal to them, without ever mentioning the word NFT.
All too often projects rely on this term as means to sell overpriced assets, however, to onboard millions of people to NFTs ~ this technology needs to work in the background, absent users having to obtain a PhD in blockchain technology.
Reddit’s success with its avatars reflects this approach having onboarded more than 10,000,000 people to NFTs, without ever pitching people on NFTs.
.SWOOSH has chosen to implement a very similar approach, and with Nike boasting more than 100 million customers, it’s easy to see a world in which Nike can surpass the number of new users they onboard to NFTs vs Reddit.
Nike is willing to leverage their brand to advance the adoption of NFTs in ways very few native NFT brands can currently dream of.
Following its partnership with Fortinte, and its upcoming partnership with EA Sports ~ it’s crystal clear Nike views gaming as an ideal vertical to onboard people to its Web3 platform.
Given gamers willingness to purchase digital assets, this strategy makes perfect sense, and absent positioning these digital products as NFTs, I personally cannot see a world in which this approach by Nike isn’t successful.
Will this result in NFTs being incorporated into games overnight? No chance
Will this significantly accelerate the adoption of NFTs by gamers? Absolutely
💡 Web3 Roundup
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See you next time! — OB1👋
This newsletter is for informational purposes only and does not constitute financial or business advice to any person or entityThe