Future or fad: will headless brands rewrite the book on branding?
"Brands will increasingly need to allow their fans to help build them" — Rosalind Bull, Brand Strategist
The blockchain ecosystem is built on decentralisation, and a new form of brands are getting built on top. Tyler Scharf explores the emergence of decentralised ‘headless’ brands, how traditional brands like adidas and Nike are getting involved, and whether this new model of branding is future or fad.
Marketers will regularly compare a brand to a living organism. A brand is a voice, a brand is a promise, a brand is an identity. Brands are curious, elusive creatures that have evolved with humanity as each new technological primitive has transformed our value systems.
It then appears curious why so called ‘headless brands’ are emerging in the blockchain ecosystem. Headless brands remain driven by a clear narrative, but they are implemented by the community from below, rather than executives at the top. If brands are living organisms, why are we taking off their heads? Is this yet another novel crypto experiment that will inevitably fail? Can headless brands succeed where living organisms would fall?
The primary value proposition behind a headless brand is that brand assets can be decentralised for shared ownership of intellectual property (IP). In other words, 10,000 people could own a piece of IP to have the right to make content with Mickey Mouse, rather than just one organisation: Disney. This provides an opportunity for a mutual relationship between brands and the communities which follow them. Fans could leverage a brand’s IP to build their own initiatives, while brands gain increased distribution as more and more people see those assets. Think of a McDonald’s franchise, but you can put the Golden Arches on much more than just a restaurant.
It could be argued that this is the logical next step for brands, whose recent decades have been characterised by an era of seamless supply chains. Seizing advantage, entrepreneurs segmented consumer needs into virtually every niche imaginable, imported products from around the world and imparted their own branding on top.
Meanwhile, fresh social media platforms (Instagram launched in 2010) augmented the twin instincts of individuality and creativity as rapidly-spreading smartphones brought news feeds into everyone’s pockets. Suddenly, there were a lot of niches to fill. Dropshipping became the internet’s favourite get-rich-quick scheme as the internet became bombarded with ads explaining how to make six-figures on Shopify, which had reduced opening your own ecommerce store to a matter of clicks.
Then came NFTs. Instead of having to monetise indirectly through endorsements and spinoff products, NFTs give brand creators the tools to transform their social value into economic value directly. This new paradigm gave rise to the de-collab model, in which NFT collections grant IP brand rights to their community members, letting them leverage the brand reputation of their broader communities in aid of their own creative initiatives.
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