Utility in NFTs

Many collectors value different things from NFTs, this could be the artwork, community or utility. The utility of an NFT is the ability to access special features and perks that come with the ownership of your token. There are many examples of the ways in which founders have added utility to their NFTs, for example the World of Women NFTs grants owners access to holders-only raffles, pre-sale and mint passes for upcoming collections and invites to exclusive IRL (in real life) events.

These types of utilities strengthen the community and create FOMO for non holders. You can find numerous projects offering token-gated events and merch but there is plenty more you can add to an NFT.

Another great example of utility in NFTs is by the Loser Club. This project values community support and empowerment, so their utility grants holders access to opportunities for artists and creatives to promote their work, to build and collaborate on projects that add value to the community. By creating a hub of creativity and support, the utility of this project is its network. This demonstrates that adding a utility to NFTs is not limited in any way, if you spot a problem that you can provide a solution for or a way to add value to your investors lives then that can be your project's utility.

Do all NFTs have a utility?

There are in fact plenty of projects without a utility that do pretty well, take Goblintown.wtf for instance. Although the projects without utilities usually have something else that draws collectors in, whether it be the art, status associated with the NFT or the community.

This may not be officially stated as the utility of the project, but you can gauge the value investors are gaining from the feedback on social media. However if you are looking to build a project that will maintain its value in the long-term then adding utility to your NFTs will help you do this.

You need to be very clear on what the purpose of your project is and this will clarify on what utility you would add to your collection. Especially when bear markets occur, you will find many collectors analyzing the value of their NFTs and whether it was worth the investment. But if you are clear on the intention behind your project then a shaky market will not deter your community.

No limits on utility

As many have witnessed the success and longevity of NFT collections with a strong utility, there has been a shift towards more utility focused projects. This isn't limited to offering benefits within the Web3 world, but extends to the real world as well. There are projects providing access to monthly food deliveries, meditation services and receiving exclusive promo codes and discounts on products and services to name a few. Soon enough your favorite restaurant will offer an NFT that grants you access to free food, discounts and other perks. When NFTs hit that mainstream demand, it is likely more people will recognise their real world application..

How to add utility to an NFT?

There are no strict rules when it comes to adding utility to your NFT project, it comes down to why you are creating it, who are you creating for and what is your project supposed to add to your holders lives. Are you providing opportunity, entertainment, education, or a tool that assists people in a certain field? When you can pinpoint those questions, you can focus on spotting a gap in the market that you can fill.

There are a few standard benefits that you can find in most NFT projects that include merchandise, discounts, exclusive events, and exclusive groups (typically alpha channels where you can get analysis from traders on the next best NFT to invest in). This is why it is essential to do your research (DYOR) on the NFT space to find out what the successful projects are doing and what people in the NFT community value, to discover how your project can shine

When you combine quality art, a desire to add something to peoples lives, and a genuine utility-based collection, you have a higher chance of creating a project that will last.