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The true value of NFTs for fine spirits and wine

NFTs. Artificial Intelligence. Web 3.0. The Metaverse. The digital space has entered a new era and with it comes the complete disruption of personalization and ownership. As with any form of technological development, brands have been tapping into this nascent space, trying to figure out a way to use it to offer something novel and innovative to consumers.

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Appealing to luxury customers and crypto-enthusiasts, Johnnie Walker paired up with Blockbar.com to offer seven whisky connoisseurs an all-new NFT experience; the chance to own a bottle of the extremely rare 48-year-old Johnnie Walker Masters of Flavour NFTs. The event was executed by brand expert and luxury lifestyle specialist RACHE, whose founder is also newly appointed South East Asia Agency Marketing Consultant for Diageo Prestige. Past career experience of working with fine spirits and wine was an advantage as it allows one to become familiar with the ins and outs of launching precious liquids, however the concept of working with NFT’s was something completely brand new.

Turning Products into Experiences

The core of the Masters of Flavour release was like any other: a spirit created with the remaining expressions from “ghost” distilleries of Glyn Albyn, Port Dundas, Brora and Glenury Royal, and distilleries of Cameronbridge, Blair Athol and Dalwhinnie, bottled in a beautiful Baccarat Crystal decanter.

Source: Royal Salute

Of the 288 bottles created, seven were launched in the form of NFTs on BlockBar, the world’s first direct-to-customer high-end spirits NFT platform. The NFT launch included seven bottles, each paired with one of seven digital art pieces by renowned artist Bosslogic and a luxury experience in Scotland. Diageo released the NFT collections, and within three minutes, all seven were sold.

The event showcased how principles of luxury — exclusivity and experience — could be recreated in a virtual space. It was incredible that NFTs could marry these different worlds online.

“[The NFT launch] offered us a platform to connect with new consumers, and in addition to this, we gave these consumers an opportunity to own a unique art piece as well an experience that equalled the rarity and exceptional nature of our incredible whisky.” – Lyndon Govender, Marketing Director of Diageo Southeast Asia. 

These experiences can reinvigorate historical brands — like those in fine spirits and wine — and introduce them to a whole new demographic. Royal Salute recently launched an NFT that featured a flagon from a limited collection of 200 crystal decanters, which was signed by designer Richard Quinn, and was sold with an accompanying 100 percent silk pocket square that was also exclusively created by the designer for Royal Salute.

“We know that modern luxury now connotes exclusivity and rarity, and that can be achieved through added-value experiences that NFTs offer. These added-value experiences really have the power to excite and spark wonder for the wine and spirits industry, as they build rarity and high desirability around a release.” – Mathieu Deslandes, Marketing Director of Royal Salute Global.

Stamp of Authenticity

The value of fine spirits and wine have seen an exponential rise over time. Rare whiskies, in particular, saw a tremendous 582 percent growth between 2009 and 2019. More people than ever before are becoming collectors. Yet, there is one problem that has persisted through the decades — authentication.

Source: Johnnie Walker

This issue was actually what prompted cousins Sam and Dov Falic to found BlockBar.

Co-founder and CEO, Dov Falic, shared his point of view: “Having been in the spirits industry for a number of years, we noticed the issues consumers and brands were facing in the world of wine and spirits. Counterfeit bottles are a real threat. Our goal was to find a role for NFTs where they would solve a real problem we saw in the market – transparency, authenticity, and quality assurance. We only sell asset-backed NFTs, which means you own the physical bottle and the NFT acts as a proof of ownership.”

By pairing the sale of a liquid with an NFT, collectors now have a digital certificate of authenticity, where any and all transactions are transparently recorded on the blockchain and can be traced all the way back to its origin.

Democratized Ownership

NFTs also serve as a key that opens the door to the world of fine spirits and wine, bringing accessibility to a wider community of collectors and investors.

This was one of the goals of BlockBar, said Dov. “We saw an opportunity to offer the collecting and the gifting of wine and spirits to all demographics. We’re democratizing the traditional wine and spirits industry and allowing everyone, anywhere in the world, to participate through NFTs. This is revolutionary and something that could not have been done before, and we expect to see an uptick in high-end spirits investments. We feel we are introducing the younger demographic to luxury spirits and the older demographic to NFTs.”

Blockbar’s Sam & Dov Falic

NFTs are bringing more to the table than just changing who can collect fine spirits and wine, but even how they do so. Dov shared an exciting new trend for the future of this industry enabled by NFTs — fractionalized ownership.

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The future of fine spirits and wine

Even with an extensive knowledge of the wine and spirit industry, the first foray into this new digital era left a lasting impression of inspiration and excitement. With Web 3.0 in its infancy, there are still plenty of ways this new world will evolve in the years to come. As it is today, it has opened up opportunities for brands to stay relevant. It allows brands to reach new audiences while keeping things fresh for existing clientele, and of course, one will likely see it become a catalyst for more innovative ways to solve extant challenges in different luxury industries.

Author: Rachel Carrasco, Founder at RACHE

Disclaimer: The views and opinion expressed in the article belong solely to the original author and do not represent the views, opinions and position of Retail in Asia.