NFT-Driven Food and Drink: Changing the Relationship Between Consumer Brands and Customers

Original text arrangement: Reprinted with authorization from the old yuppie

An interesting use case for cryptocurrency that I've been exploring is how it can change the relationship between consumer brands and customers. To that end, I researched some food and drink brands experimenting with cryptocurrency: Taika, Bored Breakfast Club, and OffLimits. It's still early days, but I'll take you through what they're doing so far so we can get a glimpse of what the consumer brand will look like in the future.

Taika creates adaptogenic beverages that are ready to drink, such as black coffee or oat milk lattes. Their drinks are designed to eliminate the jitters and anxiety people may feel after consuming caffeine.

Currently, Taika is working with FWB (Friends with Benefits) to create a club-mate flavor. For context, FWB is a Decentralized Autonomous Organization (DAO) — or, more simply, an internet community with shared bank accounts.

FWB members need to apply to join and hold a certain amount of $FWB tokens. They work together to advance the development of web3 tools.

Here's how they work together:

• Taika leverages their existing expertise to develop and produce new flavors, while FWB members collaborate with Taika on design and marketing

• FWB members can participate in the project in two ways. First, they can apply to join a paid working group to produce design and marketing materials. Or they could volunteer to join focus groups, conduct product tastings, and vote on what design to use, or which version of the drink to introduce to the public, etc.

• The profits from the sale of the products will be shared between Taika and FWB, with FWB entitled to 18%. This creates an incentive system where FWB members are financially incentivized to help Taika create the best possible product and sell more of it.

Arguably, such an arrangement is possible without cryptocurrencies—so, where do cryptocurrencies come into play?

• The open data of cryptocurrencies makes it easy to verify the assets held by individuals, whether these assets are fungible tokens (such as $FWB tokens) or non-fungible tokens (NFT). This creates efficiencies for brands looking to partner with existing communities, as eligibility criteria for exclusive events/offers can be defined based on an individual's token holdings. In this case, the opportunity is limited to FWB members only.

• It is not difficult to imagine that the successful cooperation with Taika may lead to more brand cooperation in the future. A possible downstream impact of this is a continued increase in income for the FWB community, with greater opportunities for members to receive paid work or unique opportunities. This will make becoming a part of FWB more desirable, increasing the token value of $FWB as demand increases, which financially benefits existing holders. This means that FWB members are motivated to help this collaboration succeed – and for Taika, this can make them advocates for their own brands and products.

Bored Breakfast Club is an NFT project that partnered with Yes Plz Coffee to create and sell bags of coffee beans.

Holders of the NFT are entitled to benefits such as discounts and free shipping with every new recipe. In this case, the NFT acts as a verifiable digital subscription to the Bored Breakfast Club.

The subscription service works by having a "community coffee wallet" that collects a portion of revenue from NFT sales, product sales, and merch sales in the secondary market. This wallet provides all NFT holders with the cost of producing and delivering new recipes. When sufficient funds are available, NFT holders can claim free coffee.

This means that NFT holders have an incentive to help brands scale and succeed. More sales means faster funding of the Community Coffee Wallet, which entitles holders to more and more free coffee. Such a model might work without cryptocurrency (for example, the benefits of being a paying member), but cryptocurrency makes it more effective. Brands can easily verify ownership of their NFTs and limit benefits to holders.

The unique value of cryptocurrencies lies in the tokenization of digital subscriptions in the form of NFTs, making them tradable on secondary markets. This means holders (especially early adopters) can profit from the success of the brand. For example, if a brand scales up and starts shipping free coffee faster, the value of the NFT might also increase because it provides more value. Similar to Taika, cryptocurrencies create stronger alignment of incentives between customers and brands.

Also, given that the NFT is only acting as a link between the customer and the Bored Breakfast Club founder, additional perks can also be added at any time, which is not worth mentioning.

OffLimits is a cereal brand from Emily Elyse Miller that aims to make cereal fun and delicious without any artificial ingredients.

Each flavor of OffLimits cereal is created based on the personality of the OffLimits character/mascot. One of them is Dash. Emily said: “Dash is a morning person who always feels like she needs to do more. She deals with the pressure of trying to succeed and trying to find herself. Her cereal is coffee and chocolate, which turns the milk into a cold Brew coffee."

They have already started experimenting with cryptocurrencies in several ways:

• At Art Basel in December 2021, participants can scan a QR code to receive an “NFT cereal toy” featuring an animated version of their Spark cereal flavor. A few people got the "Blast Cereal" NFT, which they can trade in for various 4-packs of cereal and some merchandise.

• Soon, OffLimits will launch The Best Cereal in the Metaverse, a collection of 2,500 NFTs. NFT holders will collaborate to design cereal boxes by submitting artwork and voting. Once the design process is complete, the holder will receive 4 boxes of cereal with the final design.

• Finally, OffLimits is working with gmgn supply. They're a DAO looking to launch 100 community-based consumer packaged goods brands, starting with a cereal brand called gm Cereal. Their vision is to be a community-driven version of Nestle or Unilever. If successful, members will be able to vote on major decisions like what products to develop, earn a share of revenue from product sales, and get paid for their contributions to the brand/organization. Similar to Taika, this partnership allows OffLimits to align incentives with existing communities and turn them into superfans and brand advocates.

In many ways, NFTs fit well with the OffLimits brand - it allows them to create unique, fun and gamified customer experiences that foster greater customer loyalty.

For example, if OffLimits created NFT "cereal toys" of various flavors, you could collect them by scanning the QR code inside each box. There may be benefits to collecting multiple or specific combinations in exchange for different perks. Remember, NFTs are just a link between the creator and the holder, so there are endless opportunities for brands to leverage this link to engage and reward their customers.

epilogue

In doing this research, my goal was to understand the value of cryptocurrencies to consumer brands and their customers.

Examples from Taika, Bored Breakfast Club and OffLimits show how brands can leverage the technology to improve customer acquisition and retention, and provide deeper value to token holders. It’s also good for consumers, as they have more opportunities to work with brands and, in some cases, profit from early support; creating incentives that help brands succeed.

Overall, cryptocurrencies look like a new tool in a brand’s toolkit — allowing them to build their communities, increase customer engagement in more effective and creative ways, and align their incentives with customers be consistent.

Information sourced from Crypto Rabbit Hole, slightly modified