Working with one of the world’s most prestigious fashion houses, we were tasked with guiding their culturally significant brand through their first foray into Web3 via an NFT issuance. Their legal and commercial teams came to us together – both frustrated with the other owing to their divergent interests and priorities.
What we did
We began, as we always do with our clients, focussing in on the strategic and commercial drivers for their planned activities. Why were they interested in issuing an NFT? As so often is the case, it wasn’t all about the immediate financial benefits – it was equally about engaging a new and increasingly important audience, while presenting their brand in an innovative light.
We then devised the business model relating to the NFT issuance, including the economic model (in NFTs and cryptoassets, often referred to as the “tokenomics”) that would unpin the value to NFT-holders and the brand itself. We also worked with the brand’s commercial team to think about the operational capabilities they’d need to service the NFT community – If a consumer called with a question, who picked up the phone or was this outsourced? Who in the business held the private keys to the brand’s cryptowallet and what safeguards were in place to protect them?
We also stepped back and thought about how the NFT issuance might fit within the brand’s broader Web3 strategy, to ensure the work being performed today was useful to the brand tomorrow.
Once we had the functional requirements of the NFT issuance, we made some technology decisions – we picked Polygon (a layer-2 blockchain build on top of Ethereum, with various performance and carbon emission benefits) as the most appropriate platform for the brand’s purposes, and a combination of ERC-1155 and ERC-20 as the token standards upon which the development work would take place. We also scoped out the non-blockchain elements of the NFT issuance – the cloud-service in which we’d host the web application (we chose AWS) as well as the storage location for the associated NFT artwork (IPFS).
As always, we leveraged The MDR Group’s award-winning lawyers to map the regulatory landscape to clearly articulate the legal pitfalls and possible reputational risks. This increased the brand’s legal team’s confidence and empowered them to approve their commercial team’s activities, secure in the knowledge that compliance was underpinning everything that we were doing.
We then deployed our expert software and blockchain engineers to develop the smart contracts (using the programming language Solidity) and the web application (using React), before enabling the brand to deploy to the Polygon mainnet and make their NFTs available for sale to consumers.
The brand used its own marketing team to develop collateral and a market activation strategy, but we also have trusted partner brands with whom we often work with on these projects where the client does not have their own capability.
How we did it
We begin all our engagements with a Discovery – a short (three week) outcome-based phase of work aimed drawing-out, interrogating and settling the project’s vision, goals and scope. It includes a lot of face-to-face contact time with key stakeholders, and we employ several tools and methodologies to extract the right information in an efficient, effective and enjoyable way.
The brand used the output of the Discovery – a report, clearly articulating the opportunity, risks and mitigations, and the specification of an implementation – to obtain the buy-in and approvals they needed to proceed with the project. Our ‘specifications’ are unique, in that they address not only the technical but the commercial/operational and legal requirements to present a full and joined up picture.
We use the Agile methodology for all of our technical implementations, and our work with the fashion house was no different. We agreed a named Product Owner within client’s organisation, and worked very closely with them to prioritise and reprioritise features and tasks as the project unfolded. In addition to the usual Agile ceremonies, we also recommend scheduling a one-to-one check-in between the client’s Product Owner/senior stakeholder and a member of the MXT leadership team, to ensure constant and clear communication and seamless service.
The client successfully launched their NFTs, gathering significant media attention and praise for their tasteful and well-considered issuance that broke the mould of NFT issuances by fashion houses and went beyond simply issuing a “trophy” NFT consisting of a jpeg image on an NFT marketplace.
The client was delighted, has since launched several other NFTs, and we’re now venturing further into the Web3 rabbit-hole with them by establishing a presence in the metaverse.