The NFT Membership Industry: A Guide for Brands and Users

Over the decades, exclusive membership programs have served as a way for brands to build deeper relationships with their most active customers. Many businesses approach membership programs with a strategy that is at least partially useful; However, most programs follow one of two basic models:

• Subscribed Paid: Users pay a set dollar amount, usually monthly or annually. In return, they only receive a predetermined package for the benefit of members. These benefits may include event tickets, access to premium content, discounts on products, and more. It’s the most popular membership model, and it uses clubs like Soho House, retailers like Costco, publications New York TimesAnd more

• Free to join: Users do not have to pay anything for their subscription. Rather, after signing up, individuals are offered different levels of benefits, which are unlocked based on purchasing activity or related metrics. This membership model is often used for customer loyalty programs, such as myWalgreens from Walgreens, instead of the gated community.

Although there is nothing inherent Wrong With these traditional models, with the introduction of non-fungible tokens (NFTs) and related Web3 technology, membership programs are receiving a much-needed upgrade. And these changes are unlocking new growth opportunities and financial incentives Both Business and NFT holders alike.

If you are considering incorporating NFTs into your business or joining an NFT-based program yourself, this article has everything you need to know.

What is an NFT-based membership program?

In short, NFT-based membership is an exclusive program that uses NFTs as access keys to unlock various services and rewards. Also known as “NFT Token-Getting”, these subscriptions use blockchain technology to verify NFT ownership and give holders access to whatever members-exclusive privileges are offered.

Like traditional membership programs, NFT-based programs can take many forms. For example, NFT ownership can unlock access to exclusive online communities such as Bored Ape Yacht Club, give users the right to vote on DAOs like LinksDAO, or offer private dining clubs and culinary experiences like Gary Vee’s Flyfish Club. .

The benefits that NFT-based membership offers will vary depending on the brand’s original offer. OneOf’s OnePass, for example, is a collection of 2,600 generative-art NFTs, and OnePass offers NFT holders a suite of online and IRL benefits that match the company’s business model. Owners get initial access to OneOf NFT drops, invitations to virtual and live OneOf events, access to OneOf’s private Discord channel, and more. There are also different levels of membership to meet the needs of different buyers. For example, with the Titanium subscription NFT, users get an additional one-year access to 11.6 million dining, entertainment, travel and retail partners.

Why NFT-based membership?

NFT-based membership is more useful than conventional programs for a variety of reasons. Initially, since they use blockchain technology, it is impossible to create duplicate membership NFTs or duplicates. This helps brands to prevent fraud This helps people so that users no longer have to worry about losing their physical cards or forgetting their sign-on information.

That said, the primary benefit of NFT-based membership programs is that they facilitate a two-way partnership between brands and holders. Through deficits, incentives and liquidity, membership NFTs ensure that both the brand and the holder are linked to the future success of the program.

Take a closer look at how each of the above ে insufficiency, motivation and liquidity ে in the NFT membership program works Both Brands and holders.

1. Lack and membership NFTs

With NFT-based membership programs, companies are able to “better serve their most loyal customers and communities,” explained OneOf co-founder and CEO Lin Die now in an interview with nft. In short, brands can better plan and focus on providing exceptional experiences to their key holders, rather than pursuing a “one size fits all” approach by limiting membership supplies and creating deficits through NFT.

Significantly, holders are not the only ones benefiting from this. By offering more deeply resonated benefits, Dai explains that brands are “creating a community of ultra-active buyers” who are “champions and advocates of the brand.”

This is fundamentally different from many other traditional membership programs that fail to limit how many members are able to achieve a certain status. For example, let’s look at airline rewards programs. Here, as a result of unlimited membership, many members are fighting for a limited number of benefits or at the same time trying to take advantage of their rewards, such as seeking seats on popular flight routes.

The opposite is true for NFT-based rewards programs. “The number of subscribers is fixed, allowing brands to always distribute the excess over convenience,” Dai explains, noting that this lack-based approach is a fundamental component of its own OnePass program.

2. Incentives for holders and brands

In the general membership program, the financial value of the membership pass does not increase over time. The situation is completely different in the case of NFT, and it creates a whole new dynamic. For the first time, the value of a membership program – and the value of individual passes – is not determined solely by the brand it offers. Instead, it is a two-way street.

Since membership NFTs have financial value in their own sense, there is an incentive for holders and brands to increase the value of membership over time.

“The value of membership NFT depends on the brand’s commitment to providing utilities and benefits equally, as well as the joint efforts of members to advocate for the brand, on building a genuine partnership,” Die explained. With traditional membership, companies can become complacent and lose benefits over time. Similarly, users may be distracted by other brands that offer similar benefits. However, with NFT membership, both parties are encouraged to actively seek new ways to enhance the quality of the brand and increase the value of the membership NFT.

3. Liquidity: Selling NFT membership tokens

Perhaps the most important difference between traditional and NFT-based membership is the ability of members to trade in the open market for NFT. Many traditional membership program users will pay a few months’ worth of money if they try to cancel it too soon. What’s more, brands sometimes make it extremely difficult for users to cancel, forcing them to go through a series and webpage and confirmation steps to complete the process.

NFT-based membership programs provide flexibility to holders.

If your lifestyle or needs change, you can easily resell your membership NFT in the marketplace you prefer – and you can actually make money. “Not only did you enjoy parks and benefits year after year during your membership, your impact on the community is now reflected in the value of the membership token, and you are rewarded again when you resell NFT and exit the program,” said Dr.

Meanwhile, with secondary royalty structures baked into smart contracts, brands can receive a predetermined royalty percentage each time they resell membership. Again, this reinforces the incentive alignment: a higher membership NFT value allows existing holders to make a profit once sold and allows brands to make more money from secondary royalties.

In some cases, like Vaynerchuk’s Flyfish Club, token holders may also lease their membership to others for extended periods. For the holders, it allows them to consider their membership as a source of revenue and also enjoys some special benefits from time to time. For those who are thinking of buying an NFT and joining the program, this gives them a chance to test their stuff.

The success of this model is easily seen. Take the Flyfish Club. All 1,500 NFTs were sold out in a matter of minutes. The initial price of NFT was about 2.5 Ethereum. Their current resale value is almost double that amount.

But wait! Obstacles to consider

Unfortunately, obtaining a traditional membership is much quicker and easier for most people, as there are no technical barriers to overcoming them. To accelerate the popularity of NFT membership-based programs, companies need to invest money and effort to improve the onboarding experience. And for brands currently considering NFT-based subscriptions, it’s important to reduce the learning curve for non-crypto users as much as possible – ideally, users don’t even realize they’re interacting with Web3 technology.

To this end, it is important to find the right mechanisms to facilitate onboarding. Dai notes that this was one of the things that OneOf took into account when creating OnePass, and it stands as one of their biggest pricing proposals. To sign up, all users need is an email and a phone number When it comes to buying an NFT, payments can be completed with any major credit card, so users don’t have to go through the hassle of buying crypto.

And the results are clear. By prioritizing ease of use and user experience, OneOf has quickly become one of the leading NFT platforms for non-crypto native users.

To emulate these results, brands considering NFT-based subscriptions need to carefully review the options and identify the ones that offer the most seamless onboarding experiences when applying NFT-based subscriptions to their websites and platforms. For example, there are a number of payers that allow individuals to make payments without having to deal with cryptocurrencies.

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