Opinion Big consumer brands and the myth of web3 innovation

Disclaimer: The opinions expressed in this article are solely those of the author and do not reflect the views and opinions of crypto.news’ editorial team.

Speculation arose last month that Nike was considering shutting down RTFKT, the digital sneaker brand it acquired for a staggering $1 billion in 2021. Although these rumors turned out to be false, it sparked a deeper reflection on whether web3, with its promises of decentralization and digital ownership, has truly delivered for consumer brands. In my opinion, the answer is a resounding no.

Consumer brands, particularly large ones, are too inflexible and risk-averse to effectively innovate within the web3 paradigm. They have only superficially adopted web3 mechanics, driven by short-term financial gains rather than a genuine integration of the technology. As a result, they have failed to find meaningful product-market fit.

The failure of large brands to innovate is not a new phenomenon. Kodak, a trailblazer in digital photography, clung to its film business and missed out on the digital revolution. Blockbuster ignored the rise of online streaming and paid the price. Today, big brands are repeating these mistakes with web3. They dabble in NFTs and blockchain as a reaction to market trends, without a true desire to innovate. This superficial adoption lacks the depth and understanding necessary to fully leverage the potential of web3.

The root cause of this failure to innovate lies in the nature of large corporations. They are hierarchical and centralized structures that prioritize stability and predictability over experimentation and risk-taking. They are rigidly organized and resistant to change. Web3, on the other hand, represents a realm of decentralization and fluidity. It is not surprising that large brands struggle to navigate this space; it goes against their very essence.

Nike’s acquisition of RTFKT was seen as a bold move into the digital realm. However, despite the initial excitement, Nike has struggled to integrate the innovative spirit of RTFKT into its broader strategy. The recent shutdown rumors highlight the underlying issue: large brands adopt web3 technologies for their financial potential, not for genuine innovation. This results in half-hearted projects that fail to resonate with consumers.

This superficiality is not limited to Nike. Louis Vuitton’s foray into blockchain for product authentication, while aligning with the brand’s emphasis on luxury and authenticity, has not significantly impacted consumer engagement. The use of blockchain here is more of a marketing gimmick than a transformative tool. It is an imitation of innovation, lacking true meaning.

Louis Vuitton has also ventured into the world of NFTs with initiatives like the “Louis: The Game” mobile app, which celebrated the brand’s 200th anniversary. In this game, players collect NFTs designed by renowned artist Beeple. Despite achieving over two million downloads, the impact on consumer engagement remains questionable, as the NFTs are non-transferable and primarily serve as collectibles without broader utility. Another recent venture by Louis Vuitton introduced the “VIA Treasure Trunk” NFTs, targeting the brand’s elite clientele with exclusive access to customizable products and early releases. However, this approach emphasizes exclusivity rather than democratizing access to digital ownership.

The true potential of web3 lies in its ability to democratize digital interactions and ownership. However, this potential remains largely untapped by big brands. The true pioneers of web3 are smaller, more agile companies that can take risks and innovate without the burden of bureaucratic inertia. Companies like 9dcc and the original RTFKT are at the forefront of this innovation. They integrate NFTs into high-end fashion, creating a seamless blend of digital and physical experiences that genuinely resonate with consumers. These companies are experimenting with new models of ownership, community engagement, and digital experiences that large brands either can’t or won’t pursue.

These smaller players are like nomads in the digital realm, effortlessly traversing the smooth space of web3. They are not constrained by corporate structures and can explore the full potential of this new frontier. They embody the concept of the rhizome, a decentralized and non-hierarchical system that can adapt in any direction.

For web3 to reach its full potential in consumer applications, these smaller innovators must lead the way. They are the ones pushing boundaries, experimenting with new technologies, and finding genuine ways to engage with consumers. Large brands need to recognize their limitations and look to these smaller players for inspiration.

Web3 is not just about attaching an NFT to a product. It requires a complete rethinking of the consumer experience, from ownership to engagement to value creation. Until large brands grasp this concept, they will continue to miss the mark, and the true potential of web3 will remain unrealized.

The philosophical implications are clear: the future belongs to those who can navigate the smooth space of web3, not those who cling to the structures of the past. It belongs to the nomads, the rhizomes, and the innovators who are unafraid to experiment and fail. True innovation is not solely driven by financial gain; it is about pushing the boundaries of what is possible.

In conclusion, the failure of large consumer brands to drive web3 adoption highlights a fundamental truth: innovation requires more than just financial investment. It requires a willingness to take risks, experiment, and truly understand the technology. Until big brands embrace this mindset, the future of web3 will be shaped by the bold, nimble, and genuinely innovative.

The question is not whether web3 will transform consumer experiences, but rather who will lead this transformation. I believe the answer lies in the decentralized, fluid, and endlessly creative realm of the small and agile. The future is theirs for the taking.