Eye on AI - August 19th, 2022
Welcome to Aigora's "Eye on AI" series, where we round up exciting news at the intersection of consumer science and artificial intelligence!
This week, we’ll be looking at how the food industry is integrating with web3, including why blockchain enthusiasts are predicting a future of collaboration with food industry brands and how NFTs are the first phase of that movement.
Blockchain Enthusiasts ID Huge Potential for Food Industry Collaboration
Blockchain, or a system in which a record of cryptocurrency transactions is maintained across several computers that are linked in a peer-to-peer network, has been a buzz term since the emergence of cryptocurrencies. The benefits of blockchain are many. In essence, it enables web3 transactions through a more secure, non-central payment system. According to the article “Fun at the foodverse: Are we there yet?” blockchain enthusiasts believe there is huge potential for food and beverage collaboration.
“Food chains getting into the crypto scene is a natural progression,” says Anndy Lian, former chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange. “... They can start from there to build more stickiness with their customers at a very young age, from NFT to games to ‘eat-to-earn’ in their own metaverse.”
Think of it this way: web3’s popularity hasn’t yet met the hype, but it’s predicted to be the next big digital frontier. If brands want to amply prepare for that market as it builds, getting into blockchain now is the smart bet. Trend-setting food and beverage brands like McDonald’s, Taco Bell, Coca-Cola, Starbucks, and others have already begun collaborating with blockchain technology. Even independent chefs, such as Michelin Star chef Vikas Khanna, have seen the potential and launched their own NFT collections.
Collaborations with web3 don’t need to be complicated. By simply accepting cryptocurrency payments brands can dip their toes into blockchain tech. But savvy brands are doing something of a hybrid shift, integrating NFTs and other digital experiences into their loyalty programs (we covered how Starbucks is doing this in more detail in last week’s Eye on AI). For instance, when someone purchases a certain meal or plan in-store, reaches a certain number of purchasing points or engages with a brand through a specific digital experience, they may receive a digital gift as a reward, such as a unique NFT – it’s like the old toy with the happy meal, only in the digital space and for adults and kids alike.
“We know even older folks look forward to the comfort of a happy meal and the anticipation of an accompanying tiny toy,” said Pranay Jain, founder of BodyFirst, a nutrition brand. “... a collection of NFTs with happy meals or the likes across various fast food chains would probably bring a lot more than just the excitement of holding toys. It could just be the start of making investments in NFTs and cryptocurrencies.”
More advanced collaborations have also begun to emerge in what some are calling a “foodverse,” or digital dining spaces brands create that allow users to interact and experience web3 together. Imagine cooking a meal led by a Michelin star chef in their restaurant with people across the globe, or meeting friends for a morning coffee in a virtual coffee shop. Experts believe these kinds of experiences may be more geared toward younger generations. For others, virtual cooking, farming, or nutrition class, may be more appealing.
While blockchain offers huge potential for collaboration, it can be a scary space to enter for the uninformed (blockchain itself has an explainability problem it needs to overcome). Brands likely won’t see a real return on investment for a number of years. Users need to overcome technological roadblocks for certain experiences to be viable. For those curious but uncertain about how to enter the space, starting simple is your best bet.
Why NFTs Are the 1st Step Food Brands Are Taking Into Web3
Speaking of simple, NFTs are the first foray many food brands have taken into web3. That’s because, according to the article “Food NFTs are the first step the food industry has taken into the new digital ecosystem,” NFTs offer a clear starting point for entering new digital spaces.
“NFTs can be used in new ways, like giving customers special discounts,” writes Crypto NFT contributor cryptozare.eth. “Companies, for instance, can use them to expand their marketing into different internet virtual spaces called ‘metaverses.’”
For example, Chipotle offered users who played their digital burrito builder game, powered by Roblex, the chance to win a free burrito. Wendy’s, McDonald’s, KFC, Taco Bell, Panera Bread, Panda Express, and others registered trademarks for their digital goods, which they sell as unique NFT artwork to be traded on the blockchain (some selling for as high as $20,000). Other NFTs are encoded with food recipes, which has grown into a market for chefs to sell their recipes and get royalties when they are resold. These and other special ‘easter eggs’ can be secretly added to rare NFTs to entice users into participation.
Some NFT collections have been wildly popular. Others, not so much. The point isn’t necessarily for brands to make an immediate ROI. The point is for brands to lay a foundation for web3 experiences so that as blockchain becomes more popular, they’re able to reap the benefits.
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