CEO at Start.vc – Ray Walia is a serial entrepreneur with over 25 years of experience in both the entertainment and technology industries.
I’ve previously written about how the emergence of blockchain technology will usher in new experiences across a wide range of industries, and more recently I’ve outlined how it could impact sports industries specifically.
Likewise, I believe digital assets can revolutionize the fashion industry, empowering fashion designers and brands to manage their intellectual property, create digital-only pieces, and develop new ways to engage their customers.
This article looks at the evolution of digital assets and ‘phygital’ items in the fashion industry and the future opportunities they offer.
Never heard of a “phygital” item before? You’re probably not alone. This term is used to describe a physical item that is connected to a digital version of itself, often through the use of a technology such as NFC (Near Field Communication) or QR codes.
In the fashion industry, this concept is applied through the use of NFTs. Because NFTs are unique and cannot be replicated, they are often used to represent ownership of digital items such as artwork or collectibles.
NFTs/Digital Assets are used to represent ownership of virtual fashion items, such as digital replicas of physical clothing or accessories. Digital assets are also used as tokens or proxies for the holders to access exclusive items and experiences offered by the brands, their celebrity ambassadors and strategic partners.
Luxury brands in the Metaverse
Several notable luxury fashion brands have embraced Web3 and proactively released projects featuring digital versions of their brand’s clothing and accessories that can be worn and used by avatars in the metaverse.
Gucci and Louis Vuitton have released both digital collections which are accessible to users on Decentraland, an Ethereum powered virtual world. These digital collections are only available to those who own the associated NFTs. The limited edition NFTs of these fashion brands can be purchased through participating marketplaces.
Dolce & Gabanna have also embraced the phygital strategy, bridging the gap between the digital and physical worlds. In early 2022, the company will launched its DGFamily NFT community. According to their website, community digital asset holders get access to exclusive releases and digital and physical events.
Token gated trading
SoleSavy is a loyal community of shoe enthusiasts who are constantly looking for ways to engage their community and provide unique experiences.
In the summer of 2022 they are released their own digital asset which allowed each holder to unlock a redemption code and gain access to a pair of limited edition sneakers called the SS4. SoleSavy has essentially crowdfunded an exclusive fashion experience with a real-world wearable. In this case, it was for a pair of sneakers designed by shoe designers Gemo Wong and Justin Taylor.
Minting the SS4 digital asset unlocked a world of benefits and allowed the holder to participate in an experience beyond the point of sale. SoleSavy partnered with Shopify for the technology to mint the SS4 sneakers, and the store first checked users’ crypto wallets for the digital asset before they could redeem it.
This new technology is known as a token gated save and buy. I think this kind of transaction is likely to grow in 2023 among online retailers, especially luxury brands, as the experience and technology continue to be refined.
Fashion brands can now see the real value of using these programmable digital assets to engage their customers and provide exclusive opportunities to their most loyal customers.
Augmented Reality in sports fashion
One of the biggest NFT stories of 2022 has been the purchase, according to rumors more than $1 billion—from RTFKT by Nike. RTFKT is self described as “an eclectic, forward-looking, maker-led organization.”
Nike has a long history in the short life of NFTs, with patents filed regarding NFTs related to their business in 2019. Several innovations and experiences are being developed and carried out between both companies, but one recent project that I found interesting was the release from RTFKT x Nike Hoodies.
The hoodies came in both a digital format that can be worn by your RTFKT clone avatars and a real-life hoodie that the holder of the digital asset can wear themselves. The most interesting thing is that the innovation with technology did not just end with the use of NFT technology. The real hoodies each have a unique QR code printed on them. When the QR code is scanned by a smartphone camera, it reveals on screen a pair of digital wings that emerge from the back of the hoodie’s wearer.
I think collections like this are just the tip of the iceberg of innovation opportunities through a combination of AR and NFTs. As AR glasses enter the market in the coming year, not only will they make the use of AR technology controlled by digital assets more functional, but they also have the potential to make it easily accessible to a wider audience. audience.
Looking to the future
As digital assets continue to evolve, I expect NFTs to open up a world of possibilities and help fashion brands create unique experiences for customers. Exclusivity and early access are much more measurable and effective when secured via tokens.
With these technologies, fashion houses can create experiences both in person and online, give access to exclusive or limited editions of their fashion items and ensure the authenticity of these items thanks to phygitals that track the chain of title, authenticity and source of materials – as well as all other data that the want to digitally link fashion brands to their products.
However, this new fashion era will take some time. Mass adoption is still a long way off. But the silver lining is that this allows companies to focus on their elite and loyal customers, who I find tend to be fewer in number and much more affluent and tech-savvy. Adoption among that subgroup of customers should prove faster, much more measurable and rewarding. I can’t wait to see all the unique ways fashion evolves and the collaborations that digital assets enable.