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When I was first introduced to the concept of Web3 – via NBA Top Shot – which solved the problems of collecting and trading sports cards, I immediately saw the parallel to my early dotcom days of surfing the basketball and design forums where my shared interests (and typing) led to faster connections than my unrefined verbal skills ever could.
Through the power of decentralization, transparency and ownership, Web3 has the potential to solve problems for the sneaker industry which in recent years has faced increasing consumer frustration over issues such as affordability and lack of accessibility. Brands like Nike and Adidas are embarking on mergers and acquisitions and partnerships, but Web3 presents opportunities for players of all sizes.
Here’s how he’s poised to disrupt this shoe market for the better.
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Accessibility issues can be virtually resolved
The sneaker world is littered with challenges ranging from supply chains to the culture of debt it operates from, but the biggest problem plaguing the industry is accessibility: enthusiasts have it harder than never have access to the shoes they want to wear.
As sneakers have become their own asset class, brands like Nike are increasingly aware that they risk losing their most obsessed customers. Loyalists can only take so many losses to bots monopolizing product releases before they become frustrated and leave the community altogether.
This is where Web3 can be leveraged to make sneaker scraps more accessible to consumers who actually want to wear the shoes – not just profit from them. Web3 gives brands more transparency about who their best customers are.
Know Your Customer (KYC) technology, for example, can be built on top of the blockchain to create digital IDs that allow brands to authenticate who buys from their site. While NFTs and social tokens give brands additional insight into consumers who are loyally investing in them.
Right now, if Nike releases 50 Jordan 1s in a year, it’s possible that a reseller with access to efficient bots could buy a substantial portion of those releases and resell each pair for double the retail price. However, if shoppers were to have digital IDs tied directly to a real person, brands like Nike might choose to distribute their limited-release sneakers more evenly. Understanding who your end customers are and their success rate is important for distributing products in the fairest way possible.
Create value beyond the point of sale
For too long sneaker lovers have shown loyalty to the brands they love with little return. Web3 has the potential to change that. Consumers can now have traceable ownership of a brand’s assets, and with this, companies are establishing a baseline of their loyal followers and exploring ways to reward them beyond the point of sale.
The traditional consumer experience is that you buy your sneakers, they are shipped and delivered. The end. Through the metaverse, brands can deliver virtual experiences that have tangible real-life benefits after a product has been delivered.
Sneaker service brands are also taking notice. Sneaker News recently launched the Sneaker News Collector Club, a Web3 community that allows its Discord members to get closer to the brand by chatting with its editorial staff and readers while offering privileged access to news. Simply put, Web3 has the ability to help brands quantify with data who their best customers are and think about how they engage them.
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New sources of income will emerge
As Web3 helps brands create virtual worlds with new experiences, businesses old and new are being forced to re-evaluate how they operate.
To wit: Nike recently acquired RTFKT, the biggest NFT player in sneakers, allowing the veteran brand to tap into a new virtual audience, who might not even want physical shoes (talk about margins) .
Adidas went the collaborative route and there were varying responses from the community as to who did it right, but the reality is very much like the early 90s: there is no definitive answer. .
One thing is certain, if you’re not studying Web3 right now for your business, you’re really waiting for another player to come along and do it better.
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