Proof of Influence: How 9dcc's latest drop hints at a future model for influencer marketing that's built on measurable trust
Newsletter #15 - December 14th, 2022
Welcome back to Brand N3xt, and a special welcome to all the new subscribers. Brand N3xt is a semi-regular newsletter and podcast focused on three things:
Educating people and brands about the value that web3 and metaverse technologies will offer to businesses, marketers, people, communities, and the world.
Highlighting use cases that are likely to drive scale and adoption, and which have to potential to yield a positive impact.
Spotlight the innovators who are leading and building in the space.
If you are reading this and haven’t subscribed yet, please do. I would love for you to join our growing Brand N3xt community. 🚀
For those of you who don’t already know 9dcc, I’ll start by sharing a bit about who they are. 9dcc is a native web3 luxury fashion brand launched by the NFT collector and influencer GMoney. So far they have released two t-shirts:
Iteration-01 launched earlier this year as a limited edition luxury t-shirt that is paired with NFTs which can be used to prove ownership and authenticity of the product. Beyond this, the t-shirts are manufactured with NFC smart tag patches as part of the design. These allow for the physical/digital connection to be established and for proof of authenticity (more on the NFC features later).
The second shirt, Iteration-02 launched at Art Basel Miami in early December 2022. Iteration-02 was developed in partnership with Snowfro, the creator of the now-famous NFT collection Chromie Squiggles. Like Iteration-01, the shirts are paired with an NFT, but this time the process has evolved so as to incorporate the generative process by which many NFT collections are made - but in this case using the generative process to create unique physical shirts. And again, each contains an NFC chip.
So in simple terms, 9DCC is a luxury fashion brand from NFT Influencer GMoney that is pioneering the development of connected clothing using NFTs and NFC technology, and is referred to as a “Networked Product”.
It’s this idea of being a Networked Product that really piqued my interest. After all, brands like RTFKT & Nike are also putting NFC chips into their connected clothing allowing people to connect clothing and NFT to validate product authenticity. The image below shows how this works through contact.
And as cool as what Nike / RTFKT are doing is, 9DCC and GMoney’s “networked product” goes a step further. Partnering with the connected experience company IYK, 9dcc lets people use the NFC chips in their shirts to generate provable social connections. I’ll explain.
People with a 9dcc shirt can let other people tap their phones on the shirts’ embedded NFC chip to get a free NFT, or more specifically a POAP (Proof of Attendance Protocol token). These POAPs reflect participation at an event, or in this case, proof of having met someone wearing a 9DCC shirt in real life. So if I am wearing a 9dcc shirt, I can give the people I meet a POAP to prove that there is a real-world connection between the two of us. As I give out more POAPs, I am effectively building a digital network of people with whom I have connected in the real world through a tokenized connection. Although it should be noted that each shirt is able to deliver a maximum of 200 POAPs so owners might want to be choiceful about who they give them to.
For 9DCC, the connections that each shirt owner creates become an extension of the brands’ network and can be used as a mechanism for broader reach, engagement, and reward, or even as a channel that can be used to distribute exclusive content.
You’re probably starting to see how this relates to influencers already, but I will get into the specifics later. But first, let’s talk more broadly about how and why brands and marketers work with influencers.
WHAT THIS MEANS FOR INFLUENCERS
Let’s start with definitions, and let’s define an influencer as anyone with an audience and the ability to influence their opinion. In today’s market, an influencer could be a celebrity, an athlete, a blogger, a YouTuber, or even just a person with a large social following - in fact, the term is most commonly associated with Social Media. Companies spend roughly $15 billion a year with influencers to promote their products or services, so this is a big business.
It’s gotten to be such a big business that some influencers can command very high fees. A post from Kylie Jenner to her hundreds of millions of followers could for example cost up to $1,000,000 per post. While there’s no doubt that this spending can be very effective, it is also cost-prohibitive for many brands.
A more recent trend has been the use of micro-influencers. Micro-influencers are defined as having a following between 1000-100,000 people. They’re often considered more relatable than their celebrity counterparts and so their recommendations can be seen as more “authentic”. As an additional benefit, they are a fraction of the cost of celebrities making them more attractive to brands who need to work on a smaller budget.
But while micro-influencers often command disproportionately high levels of trust from their followers, attributing the value and impact that this trust delivers is difficult. With big celebrity influencers, brands know exactly how to measure what they are buying: reach and awareness. But with micro-influencers, reach is much smaller, and trust is hard to measure leaving marketers and brands looking to understand the impact that trust may offer as a result.
Ultimately, the question is, will the theoretically higher levels of trust given to micro-influencers result in higher conversion rates than the brand would get from working with a celebrity, or just using traditional advertising?
The above chart shows how the relationship between Reach and Trust impacts the overall value returned back to the brand. Imagine on the far left that a message is sent to everyone in the world (maximum reach). It would most likely be met with a high degree of cynicism and so may not perform perfectly (although there would still be a number of people who do listen and for that reason, the impact is not zero). On the far right, imagine a conversation between two great and trusted friends. While this is highly likely to result in a real-world conversion, the reach is limited to a single person and hence offers no substantive marketing value on its own.
And this is where 9dcc comes back into the picture as they use NFTs and NFC to create an on-chain connection between products and people. This connection model provides a natural extension to the Reach focused activities of both micro and macro influencers, but in this case, through provable interactions brands gain the ability to better understand and measure Trust within influencer relationships. This is not just a fluke but a new model for influencer marketing built around Proof of Influence.
PROOF OF INFLUENCE
If we look at 9dcc and the connected Iteration-01 and Iteration-02 shirts that they have created through the lens of influencer marketing, a few potential solutions to the above-mentioned challenges start to stand out.
Firstly, the present-day challenge of sizing the unique reach of micro-influencers can be solved through tokenization. This is possible because tokens are stored in wallets whose addresses can be viewed on-chain allowing brands who engage with multiple micro-influencers (or who will engage with them in the future) to see the overlap in wallet addresses between influencers without requiring identity data.
Imagine every micro-influencer, or in this case 9dcc shirt owner, having their own unique POAP-powered social graph with visible wallet addresses at the end. This would let brands, and potentially their partners, quickly identify individual wallets that overlap across influencers with precision. In fact, that’s pretty close to what is shown in the tweet below about the POAPs minted at the recent Art Basel Miami event.
Thinking specifically about 9dcc, these tokenized connections are made through in-person interactions using mobile phones. This means they can probably even map where people were when a POAP was shared/minted based on mobile GPS data.
More interesting, and maybe more importantly, these tokenized connections will redefine what it means to be an influencer in the first place. So to be a “connected product” influencer, you won’t need a big social following, you’ll just need to own the actual product. That’s because every product owner who shares even a single token could be recognized for the reach they provide, and if that reach results in a conversion, it could be seen on-chain and they could be both recognized and rewarded for the impact and value they deliver.
It’s all about the power of network effect, and 9dcc is actively building its network by encouraging its shirt owners to share POAPs through gamification tactics. The image below is from their website and shows how their leaderboard from Art Basel Miami is tracking which crypto wallets have collected the most POAPs from 9dcc shirt owners, and which 9dcc shirt owners have distributed the most POAPs to other people.
Do you think you would have been able to collect or distribute more than Gmoney?
Now that Art Basel Miami has concluded, I am not sure how long the leaderboard will be up, so I took a screenshot. But if you want to check it out for yourself, you can follow this link to see if it still works.
Outside of sharing POAPs and extending their network in this way, I have to be honest and say that I don’t know how or if 9DCC intends to activate and reward POAP collectors and/or distributors in any way. But just by looking at the shape of what they have put in place, I would say that we are getting a window into the future of influencer marketing. A future where value, influence, and trust are more easily recognized, measured, and understood.
Four features of future influencer marketing relationships will be:
Relationships will be verified through active participation – In the case of 9dcc the networks are built through in-person interactions and not just social follows. What’s critical about this is that the engagement is built around active participation rather than simple passive content consumption. This activity implies a greater level of interest, trust, and ultimately value.
Note that while the examples in this article shows POAPs being distributed through face-to-face interactions, they can be distributed through digital interactions as well. What’s critical for Proof of Influence to be established is not whether it’s an in-person or digital interaction, but rather that the interaction can be proven to be an active and considered engagement.
Analysis of reach, will focus unique and strategic reach – Given that blockchain data is visible, tokenized social graphs such as the one 9dcc is creating with POAPs will make it possible to compare influencer audiences with precision in order to understand not just the scale of their reach, but also where there are overlaps with the brands existing customer based, desired customer based, and with other influencers they work with.
Frequency of interaction will allow brands to better estimate trust – Collecting more tokens from a single influencer will be indicative of continued and more active engagement as opposed to a simple one-time follow. In this way, frequent tokenized interactions will become a primary facet of calculating implied trust. Implied Trust is a metric I would expect to see a lot more of in relation to influencer marketing as we go forward into the era of web3.
Trust-driven actions will be fully attributable through on-chain actions – Benefits, deals, or other exclusives made accessible through the POAPs / tokens distributed by influencers will be 100% attributable as all actions will be visible on-chain. This means that if you make a recommendation (share a POAP / token) that leads to someone else making a purchase (using the POAP / token you gave them) then the value you delivered can be 100% attributed to you. This attribution will be another key metric in calculating Implied Trust.
These four areas of impact clearly show how the strategies and technologies that 9dcc, IYK, and POAP are developing will enable more than just fun experiences. They are in fact the foundation for a more measurable future for influencer marketing built on a new concept that I am referring to as “Proof of Influence” - or measurable Trust.
OTHER ‘CONNECTED PRODUCT’ BENEFITS
IYK, the company behind the “connected product” technology that 9DCC is using describes itself as a bridge between the physical and the digital world. As people’s lives increasingly exist in both places, bridges between the two are likely to grow in importance, and in effectiveness over time.
One of the other projects that IYK recently launched was for the musician Vérité. Working together they created a connected crewneck that gave fans early access to the first single off her upcoming album. Buying her crewneck no longer just meant getting some fan merch. The crewneck became a direct connection between Vérité and her fans.
After buying the crewneck and registering, the purchasing fan would get messages about new content releases and when they would drop. As portrayed in the image below, all a fan would have to do to get access to this exclusive content is tap their phone onto the IYK patch of the crewneck during the specified time.
Needless to say that the feedback on getting this kind of exclusive content was fantastic. So much so that Vérité has continued to deliver content like live rehearsal videos from her tour and early access to her second single as exclusives delivered through the connected crewneck to owner/fans.
The value of this deeper connection between artist and fan was not lost on either party. The fans feel more connected to the artist and get more content, and Vérité has been able to monetize the connection by not only doubling the price of her crewneck but also selling more of them.
If you want to read additional details about this case study, you can click here.
Beyond this, IYK has also partnered with brands to power connected scavenger hunts, and to help brands bridge the divide between the physical and digital worlds in many other ways.
What’s clear in all of it is that “connected product” technology and tokenized influencer connections offer real potential for marketing. The technology doesn’t remove or negate the value of reach for influencers at all, but for the first time, it gives brands and marketers the tools to understand, measure, and attribute the real value of the trust imparted to specific influencers (regardless of scale and reach).
Don’t underestimate the importance of what this could develop into. Trust has never been truly measurable. There hasn’t even been a very good proxies for it. And while “connected products” are likely just the start of how tokenized relationships will continue to develop, its easy to see how they will allow full-funnel attribution on-chain and provide a new method of measuring trust (or at least a proxy for it) at scale. This will be Proof of Influence.
I’d expect many influencers (and brands) to test new strategies and tactics in this space. Some of the tests might include:
Turn product owners into influencers by getting them to share tokens relating to a brand or product through IRL interactions (as is being done by 9DCC)
Map the “social graph” of the wallets that get these tokens to identify overlapping audiences between influencers
Reward and engage influencer audiences with exclusive content, token-gated experiences, token-gated discounts, or even product exclusives (similar to what is being done by Vérité)
Identify and reward influencers whose networks are most engaged with the brand, or whose networks convert best (tracked by wallet connection for token-gated products)
And for brands who eventually build up a critical mass of token holders (maybe a year or two from now), then the brand will be able to compare tokenized influencer communities with their own tokenized reach in order to understand which influencers:
have the trust of people who have made past purchases with the brand
have the trust of people who are brand loyal
have the trust of people who have bought from the brand in the past but churned and need to be reactivated
have the trust of people who are new to the brand
This increased understanding of Trust could potentially increase the importance of influencers not just within a brand’s reach and awareness strategies, but also within their loyalty and CRM activities.
We are still early and just scratching the surface of what use cases will be developed in this area. That said, I am excited and inspired by what 9dcc, IYK, and POAP have started and I can’t wait to see how more brands and influencers work to put measurable trust at the heart of their communities through tactics that build around Proof of Influence.
While this article references work from 9dcc, IYK, and POAP, it should be noted that I have no direct knowledge of their plans, or of how or even if they will actually be using these tokenized connections for “influencer marketing” type purposes.
My writing is a speculative reaction to their work where I am inferring the types of use cases and value structures that I believe will be enabled for the marketing industry through the types of activities and technologies that they are pioneering.
LINKS FROM THIS ARTICLE SO YOU CAN DO MORE RESEARCH
If you enjoy the Newsletter and want to get more, please subscribe to make sure you never miss an issue:
If you already subscribe, but want to do more to help me out, please share the article. One share from you makes a world of difference to me.
And if you want more content from Brand N3xt, you can either subscribe to the Podcast or follow and connect with me on social channels through the links below:
Follow me on Twitter at @justinkpeyton
Follow me on LinkedIn
Nothing in this newsletter is intended as financial advice. This newsletter is for educational and entertainment purposes.