Sold out in 33 seconds: What is the fashion NFT phenomenon all about?

After three days, the 3D TECH Festival 2021 came to an end a week ago, bringing together international experts from the ever-expanding field of digital fashion. On the last day of the online event, the focus was on a new fashion phenomenon: NFTs. What is that all about?

Global hype NFTs

Three weeks ago, the first “non-fungible tokens” (NFTs) by fashion icon Karl Lagerfeld were launched. First, a black and white NFT figurine, of which the digital platform The Dematerialized offered a total of 777 pieces at a price of 77 euros each. A second, shiny metallic NFT figure by Lagerfeld, of which only 77 pieces were offered, cost 177 euros each.

Within 33.77 seconds, the more expensive version was sold out; the cheaper one took 49.09 minutes, revealed Marjorie Hernandez, co-founder of The Dematerialized, during her presentation. Traffic to the website where the NFTs were sold came from all over the world. Sixteen percent from the US, 39 percent from Europe and 45 percent from the rest of the world. “The interest in the Karl Lagerfeld NFTs is global,” continued Hernandez. It goes far beyond the brand's classic marketing channels and reaches new target groups, especially younger generations.

Tamper-proof JPEG files

Why the hype? What are NFTs and what is the metaverse they were created for? Finally, what does the new technology bring to the fashion world? This is exactly what the 3D TECH Festival tried to find answers to. Because one thing is clear: the Lagerfeld NFTs are only the latest example of a new technology adaptation that is currently en vogue especially among high-fashion brands: Burberry, Balenciaga, Gucci, Luis Vuitton, they are all trying to gain experience in this new field.

NFTs are nothing more than JPEG files. These non-fungible tokens are, in a sense, digital certificates of authenticity that are usually secured via blockchain technology and are thus tamper-proof. NFTs come from the art and gaming sectors. Only in March of this year, a picture by artist Beeple was auctioned off at Christie's for 69 million euros - probably the most expensive JPEG file in the world to date.

A new sales channel for brands

For fashion brands, digital fashion opens up a completely new field of activity. They can sell their fashion not only in the real world, but also in the virtual world via NFTs - especially in the gaming world. There, too, clothing plays an increasingly important role. “For kids, the skin they wear in Fortnite is just as important as their clothes in real life. Both reflect who they are,” says Evelyn Mora, one of the initiators of Helsinki Fashion Week and founder of the social metaverse “Digital Village”. In Metaverses, players can create personal avatars, shop, attend fashion shows, meet each other and even buy land and real estate. The possibilities are endless. Unlike most social media today, a metaverse is a collective virtual space that is usually stored in a decentralised way and is often based on blockchains, for example to secure one's own currencies.

In its infancy

“Fashion brands are just starting to understand NFTs,” says Richard Hobbs. He comes from a fashion background himself and founded the NFT platform bnv.me. Much is just emerging and it is not yet decided where exactly the journey will go. “There was a risk launching the Lagerfeld NFTs,” says Mirjam Schuele, head of marketing at Karl Lagerfeld. “There are not many benchmarks to go by. We did our best, but of course we couldn't know in advance how the market would receive our NTFs.” The success of the first NFTs encourages them to continue with the technique. The next drop is already planned, though she doesn't want to reveal more about it. “We really want to explore the world of NFTs and see how we can push the boundaries in new ways,” Schuele says. Hobbs advises the industry to get to grips with the issue. "You have to jump in the water now if you want to ride the wave, because the wave is coming now.”

This article was originally published on FashionUnited.de. Edited and translated by Simone Preuss.