After two years of absence from museum visits, when a friend suggested that we meet up at the British Museum to see ‘Hokusai: The Great Picture Book of Everything’ exhibition, I jumped at the opportunity. Hokusai is one of the best-known Japanese artists and printmakers in the West. His breath-taking composition of the woodblock print ‘The Great Wave’ is said to have inspired the composer Debussy’s La Mer (The Sea) and the poet Rilke’s Der Berg (The Mountain). The exhibition itself was fascinating but what also captured my attention was the pop-up store offering NFTs of more than 200 of Hokusai’s famous works outside the exhibition.
Non-fungible tokens, NFTs, are a hot topic and you have likely read about them in recent months. So, what are they? NFTs are unique digital assets that can’t be copied and exist in a blockchain, a form of digital ledger. They are traded online and may represent real-world objects like art, music, in-game items and videos. As the New York Times neatly explains, they act as ‘the certificate of authenticity’ you might get if you bought an expensive physical painting. NFTs came to prominence in March last year, when a graphic designer, artist and animator known as Beeple, sold his digital work as an NFT at Christie’s for more than USD 69 million. The work, called ‘Everydays – The First 5000 Days’, was a collage of all the images he had posted online since 2007.
Luxury brands embrace digital assets
NFTs are not unique to the art world. Luxury brand companies are exploring and capitalising on the digital assets boom too. The rationale is simple. Today, Millennials and Gen Z spend more time interacting with their friends on social media or gaming platforms than in real life. As more and more people live their lives on the internet, the demand for digital fashion and branded goods is likely to grow significantly.
In May 2021, Gucci teamed up with various gaming companies to learn how the gaming community responded to its content. To celebrate the brand’s 100th anniversary, it opened a virtual Gucci Garden on the popular gaming platform, Roblox. Digital assets (not NFTs) were created, bought and sold on the platform. A digital version of Gucci’s Dionysus Bag with Bee was sold for the game’s own currency of 475 Robux, (equivalent to USD 6 at the time). Subsequent resale fetched an eyewatering equivalent sum of USD 4,115 (350,000 Robux), almost USD 800 more than the same physical bag in stores at USD 3,400. The event highlighted that digital assets not only have value but also that the value could be very significant. Later that year, Gucci expanded to NFTs by creating a four-minute fashion film based on its Aria collection as an NFT to accompany a runway show. It sold at Christie’s for USD 25,000.
Other luxury goods companies have been evaluating NFT opportunities too. In August 2021, Burberry launched an NFT collection entitled Blankos Block Party in partnership with Mythical Games.
Blankos Block Party is a game featuring digital vinyl toys known as Blankos that live on a blockchain that provides players with proof of verified ownership and authenticity. Adorned with Burberry’s new TB Summer Monogram, Burberry Blanko, a shark named Sharky B, is a limited-edition and limited-quantity NFT that can be purchased, upgraded, and sold within the Blankos Block Party marketplace. All NFTs were sold out within just 30 seconds of the launch and Burberry made just under USD 400,000 from the sales. In the subsequent secondary market, Blanko fetched as much as four times the original price. These NFTs had a built-in smart contract, such that each time Blanko was sold, Burberry received a royalty.