The 250 CryptoPunks necklaces from Tiffany&Co. sold out in twenty minutes. 12.5 million dollars in twenty minutes: successful bet for the jewelry house Tiffany & Co. (LVMH group), which has put on sale a collection of 250 necklaces based on CryptoPunks. If the record operation is surprising, it is not the first of its kind to bring in so much money – and visibility – for historic luxury houses.
The Tiffany & Co NFTiff collection: A record after Dolce & Gabbana
On August 1, we reported to you the announcement by the jeweler of the LVMH group of a collection of pendants bearing the image of the CryptoPunks.
Clearly, Tiffany & Co. wanted to give the possibility to the holders of these famous NFTs to decline them into physical jewels. Priced at 30 ETH, the 250 pendants, each accompanied by an NFT to certify ownership, where to find buyers between August 5 and 12.
It therefore only took the jeweler twenty minutes to hit the mark.
Alexandre Arnault, head of the jewelry house, seems to have inspired the project. He himself owns a CryptoPunk (#3167), and last April tweeted the image of his own pendant inspired by his NFT:
Alexandre Arnault, head of the jewelry house, seems to have inspired the project. He himself owns a CryptoPunk (#3167), and last April tweeted the image of his own pendant inspired by his NFT:
The success of the NFTiff collection is not the only spectacular launch of the genre. In October 2021, we reported the record sale by Italian Dolce & Gabbana of nine NFTs brought together under the name of DGFamily.
Again, 4.8 million euros were collected (1885 ETH to be precise) in a few hours.
Behind Tiffany & Co., a whole strategy of the LVMH group
Since 2021, the French luxury flagship has been investing a significant budget in blockchain tools.
The group first joined forces with competitors to launch AURA Consortium Blockchain in April 2021, a consortium led by LVMH and made up of Italians Prada and OTB Group (Diesel, Marni) as well as French Cartier.
Basically, it is an authentication platform where the data of the manufactured products is registered, at the same time as it is stored on the physical product itself using NFC or RFID chips.
Since then, the product authentication solution has created more than ten million NFTs to authenticate the products of the three groups.
More recently, an envelope of 100 million euros was entrusted to the French venture capital fund Aglaé Ventures by the Arnault family and the LVMH group. A fund stamped “Web 3.0”, in plain English, intended to develop blockchain tools that can be used in the luxury market. It is not yet known which are the first start-ups to have received funding.
In the meantime, Dom Pérignon (one of the group's champagne brands) had set up a promotional operation with Lady Gaga for a series of 100 NFT bottles, before the corresponding 100 physical bottles were delivered to the store.
What is the interest of luxury labels to invest in NFT?
The list of luxury brands that are racing for NFTs is getting longer with the weeks: Gucci and its virtual sneakers, Guerlain and its NFTs for the benefit of bees, Givenchy and its NFTs for the benefit of diversity, Balenciaga and its artistic NFTs, …
It must be said that NFTs have three main advantages for historic luxury houses.
First, it appears that NFTs are a solution against counterfeiting. As shown by the Aura initiative led by LVMH, the NFT serves as a virtual identity card for each new product. It is issued at the same time as the physical product: a bag, watch, or any other ready-to-wear item.
Thus the buyer only has to scan an RFID chip or a QR code on the item, in-store, to verify its origin and authenticity.
Then because NFTs allow luxury brands to keep an eye on the secondary market. The market for second-hand products is indeed a big problem for luxury houses, as reports of counterfeiting are legion and have the potential to undermine a whole brand image. Thus, owners are invited by houses to update their NFT data when an associated physical product changes hands.
Finally, NFTs are also one instrument among others of brand image. With a certain idea of rarity, uniqueness, and exclusive belonging, NFTs resonate with the credo of the majority of luxury brands.
After NFTs, luxury brands are interested in the metaverse
It is curious to see that LVMH is also interested in NFTs that have no connection with the physical world. As you will have understood, the group has also set foot in the dematerialized worlds that are the metaverses.
The group's first foray into the virtual world is to be credited to its subsidiary Louis Vuitton.
In August 2021, it posted the Louis The Game video game, in which your avatar searches for 200 unique candles, in tribute to the 200th anniversary of the house. Thirty of them are NFTs, a few of which have already been spotted on virtual item marketplaces.
An initiative was taken in the wake of other historic houses: Valentino, which unveiled a collection of clothing for the avatars of the game Animal Crossing, and Balenciaga, which did the same with some hoodies for the game Fortnite.
There too, it is for LVMH and its competitors to decline their storytelling by building customer loyalty with the help of virtual experiences...exclusive (obviously!). Several sources mention plans for virtual tours of the Louis Vuitton workshops, and even a fashion week like the Metaverse Fashion Week organized at the end of March in the Decentraland metaverse.
50 billion dollars by 2030: according to the American bank Morgan Stanley, this is the enormous financial windfall that NFTs (and more generally the blockchain) could bring to luxury brands. Arianee, a Parisian start-up that develops NFTs for fashion and luxury houses, has just raised 20 million euros.
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