RTFKT is an eclectic, future-focused, creator-led organization. They use the latestin game engines, NFTs, blockchain authentication and augmented reality,combined with design and manufacturing expertise to create unique experiences with phygital fashion, sneakers, and digital artifacts. They are known to create viral sneaker designs, collectible exclusives, 3D& AR wearables, unique avatars and original art.
RTFKT has released numerous collections to date and primarily generates revenue through the initial sales of each collection, as well as through royalties earned on trading volume. Each collection is launched with a capped supply, necessitating the creation of new collections in order to generate additional revenue in the absence of funding from Nike. However, it is important to establish a sustainable monetization strategy that does not rely solely on new collection drops, while still maintaining the authenticity of the brand and its cultural relevance.
The monetization strategy for NFT brands is highly dependent on their vision and mission, as well as their past project approaches. In order to create a sustainable monetization model, there are two possible solutions: an open supply NFT collection with attached products, or a subscription model that maintains the brand's exclusivity. The former can allow for revenue and reach to scale, while the latter can ensure steady revenue for a certain period of time.
To solve the monetization issue for RTFKT, a one-time only collection would be launched, where the NFT would act as a subscription to a surprise box. The quantity of NFTs offered in the collection will depend on the monthly revenue the brand needs to pursue. Data analysis will play a key role in determining the churn rate and quantity, and in finding ways to keep users engaged and subscribed. The NFTs would serve as a representation of the subscription and a tangible asset that can be traded, adding value to the overall user experience.
However, running the subscription only through the blockchain may pose challenges when users are unable to fund the retainer. To overcome this issue, the subscription model will be built around KYC and Web2 compliance, allowing for proper action to be taken when necessary. The surprise boxes, filled with exclusive and limited edition RTFKT merchandise, such as limited edition sneakers, clothing, unique accessories, or early access to new product releases, will be shipped every quarter, with each physical item receiving an NFT attached to it for added security, authenticity, and trading capabilities.
To further enhance RTFKT's monetization strategy, in addition to the one-time only collection that serves as a subscription to a surprise box, we propose introducing different membership tiers for the subscription-based model. Each tier would offer varying levels of access to exclusive content, merchandise, and experiences, catering to different customer preferences and budgets while providing a more customized user experience and potentially increasing overall revenue. For example, a basic membership tier could grant subscribers access to standard RTFKT merchandise, early access to new product releases, and access to community events. A premium membership tier might include additional perks, such as limited-edition collaborations, exclusive digital content, and priority access to in-person events. By offering various membership tiers, RTFKT can attract a wider range of subscribers and generate consistent revenue streams while still maintaining exclusivity and cultural relevance. This tiered approach also allows subscribers to choose the level of engagement and investment that best suits their interests and budget, fostering a more inclusive and diverse community around the brand.
Although this monetization model will not be scalable due to the desire to remain exclusive and maintain a limited supply, it provides a baseline for adding strategies, collecting data, and building upon it in the future. Additional strategies, such as collaborations, events, sponsorships, and more, could be introduced to increase scalability and revenue for this model. Since the NFT market is still evolving, it is important for us to remain adaptable and open to change in order to ensure long-term success.
The surprise boxes, filled with limited and exclusive items, will create ongoing hype, relevance, and high anticipation for every new drop, ultimately leading to increased revenue and growth for the overall project. The reason why we focus first on a limited supply collection is that the current culture/market isn't ready to be leveraged for monetization on a larger scale. This limited collection will act as an initial testing ground, allowing us to put our foot in the door, collect data and adapt our approach over time.