NFTs have been embraced by fashion and beauty in 2021, and now they’re making their way into physical stores.
On Thursday, Los Angeles-based retailer Fred Segal debuted a “dynamic retail experience” called Artcade in its Sunset Boulevard store. Created in partnership with media tech holding company Subnation, the experience includes an NFT gallery with digital wall displays, physical and digital products for sale, and a streaming studio. The retailer follows several others that have launched physical activations around NFTs as they’ve increasingly entered the NFT space. These include Dolce & Gabbana, which staged an NFT installation in one of its flagship stores, and Rebecca Minkoff, which held an NFT exhibition for New York Fashion Week.
The items being launched as part of the new experience at Fred Segal include IRL collectibles, limited-edition apparel and gaming hardware. Visiting customers can use cryptocurrency to purchase virtual products including NFT artwork and digital skins online via Coinbase. The retailer is working on allowing cryptocurrency to be used in-store to purchase items.
“The metaverse is going to happen in one way or another,” said Jeff Lotman, the CEO and owner of Fred Segal. “The idea of being involved in having a Fred Segal store in that world makes sense, because we’re always a place showing things that are really cool.”
The exhibition features highly valued works owned by a group of top NFT collectors. Pieces from the Bored Ape Yacht Club, The Mutant Ape Yacht Club, Doodles and Cool Cats are featured. The most valuable NFT on display is a Bored Ape Yacht Club piece worth 35.47 ETH, equal to $142,466.32 at the time of publication. Customers can also purchase items from jewelry label MetaGolden, which sells physical jewelry along with an NFT that represents each specific piece.
In the coming months, the retailer and Subnation will be both commissioning and curating exhibitions and original drops from NFT artists. These include music photographer Henry Diltz, who produced an NFT version of his cover of a Crosby, Stills & Nash album that will be accompanied by a documentary.
“Our view on NFTs is that they’re about both physical and digital goods, as well as the storytelling around them. NFTs are not just the digital asset itself; a whole host of other assets that can be delivered behind it,” said Doug Scott, co-founder and chief managing director at Subnation.
As NFTs are increasingly making their way into physical art galleries via digital display tablets, other retailers are also eyeing the possibilities.
“Right now, so many commercial brands are seeing the value of taking assets they already own and creating new ways to share them with fans through NFTs,” said Roxy Fata, the COO of Infinite Objects, a company that creates wall display screens for NFTs. “To make the sometimes confusing concept more understandable, these brands are seeing the added value of including a physical version of the NFT to make sure their audiences can enjoy it and to display the content in a meaningful way.”
Physical in-store displays of NFTs are “a way to educate the audience to see what an NFT looks like,” said Olivier Moingeon, chief commercial officer at startup Exclusible, a luxury NFT e-tailer that aims to be the “Net-a-Porter of NFTs.” “Most people have heard about NFTs and they don’t know what it is. They think it’s just a JPEG that sells for millions of dollars, and no one understands it.”
As with traditional art, luxury brands are tapping into NFTs to reach a wider customer base of wealthy collectors.
“The demographic in the NFT world is 85% men and only 15% women, whereas in the luxury world, it’s kind of the reverse; you have a majority of women as the buyers.” An NFT “can be a gigantic opportunity to recruit men and to expose them to a brand’s storytelling, to capture their attention,” said Moingeon.
According to Lotman, there’s overlap between the typical Fred Segal customer and the NFT collector. “We have that demographic. They like to be on the cutting edge. They’re reading publications and going online and seeing things that are really cool that are trending. We sell limited-edition sneakers, we sell resale sneakers, we sell resale vintage — and we’ll always want to be where the trend is,” he said.
In the future, Fred Segal will work with Subnation to create a virtual version of its store on a yet-to-be named metaverse platform. Like the physical store, the virtual version will display NFTs and host limited-edition drops.
“This is going to become only bigger and bigger, especially as the metaverse really starts to grow,” said Lotman.