For those who remember typing BRB into their MSN chat box, or anyone still wrestling with the WFH concept, there’s a new acronym in town, and it’s potential to shape the future of entertainment and the collectables space is boundless. It’s probably time we all got to know NFTs a little better.
Here’s The Insights Family to help talk us through the concept and what the arrival of Non-Fungible Tokens could mean for the toy industry.
We all know this generation of children are like no other, growing up in a world with an unprecedented level of access to technology.
Even by the age of three, an average 51 per cent of children globally own a tablet device, and by the age of 12, 69 per cent of kids globally own a mobile phone. This generation are as comfortable existing in a virtual world as they are the physical, and they expect a seamless integration between the two.
We have seen many key development milestones just as likely to be reached today in a virtual world as the physical; a child’s first concert for example could just as likely happen within the gaming platform, Fortnite as it could in a real-life venue.
As the physical and digital worlds blur for this generation of kids, we are also seeing children spending and earning money digitally via gaming platforms like Roblox, Minecraft and Fortnite. Kids’ identity now lives online, whether that be on a social media feed or materialised through digital purchases. For these kids, a cosmetic skin they purchased in Fortnite is as much about self-expression and personality, as the t-shirt they put on the same morning.
The speed of innovation in this sector continues to accelerate and its important brands stay ahead of the latest trends and opportunities.
Non-Fungible Tokens (NFT) are currently one of the most popular trends within the cryptocurrency market. A token which verifies legitimacy and singularity of a digital asset, they have primarily been used to sell digital art or assets, such as the first ever Tweet, selling for over $2.9m. The technology has since been adopted by major art auction houses such as Sotheby’s and Christie’s.
According to The Insights Family data, from Q1 2020 vs Q1 2021, there is a 11 per cent increase in kids as young as six to nine who have heard of cryptocurrencies. While information about blockchain is permeating throughout the kids ecosystem, it is still a relatively niche market.
However, as global adoption of cryptocurrencies continues to increase, brands are using the NFT as a real-world use-case for the technology. It’s currently mostly fashion brands – such as Gucci experimenting with NFTs, enabling consumers to buy and ‘wear’ their products via Augmented Reality or in-game on Roblox.
In fact, these fashion sales of clothing for digital versions of yourself are not news anymore. It is a long-standing practice, and a lot of video generate their main income through it. For example, one of the most popular games of recent years – Fortnite, is monetised entirely through cosmetic microtransactions.
What this means to you…
One example of potential NFT integration in the kids’ ecosystem could be as an extension of collectable items – for example, trading cards, a digitised version could be available as a token. The popularity of trading cards in general increased throughout the pandemic – from six per cent of kids aged three to 12 purchasing in Q1 2020 to nine per cent by December.
Within the toy space, in theory, anything in the digital world which has scarcity and value derived from that scarcity could be reimagined as an NFT.
For instance, some collectors are already spending millions on ‘NBA Top Shot’ – a website that allows people to buy, sell and trade basketball highlights as NFTs.
Every year the number of younger kids who spend more of their money online increases. In the UK, since the pandemic began in March 2020 the number of three to 12 year olds has almost doubled from 17 per cent to 28 per cent in February 2021. This, along with fast-paced innovation, means that it’s important brands stay ahead of the latest trends and opportunities.
Therefore, The Insights Family team of researchers, data scientists and developers have created the latest version of our platform, Portal 4.0, which will open more possibilities for brands. The new tools will enable brands to understand the attitudes, behaviours, and consumption patterns of kids, parents, and families.
To learn more about the attitudes, behaviour, and consumption patterns of kids, parents, and families, and to get freemium access to The Insights Family real-time data portal, please visit: https://try.theinsightsfamily.com/toynews