Crypto fintech firm MoonPay has big plans to make non-fungible tokens, or NFTs, both easier to make and easier to buy — and its grand strategy has everything to do with fashion, the company told WWD.
Days after the Council of Fashion Designers of America revealed that it chose the platform to handle transactions for its upcoming NFTs, creative arm MoonPay Studios lit up New York Fashion Week with digital fare for Alo Yoga, Collina Strada and Brandon Maxwell, which hit the shows with an array of NFTs ranging from fun to functional.
Those collaborations aren’t incidental. In an exclusive interview with WWD, the company explained that these are parts of a broader strategy targeting fashion — and now that NYFW is in the bag, MoonPay can put its full attention on its next fashion project: an undisclosed NFT that will pair the platform with a major athletic brand.
The details are still under wraps, but according to Tom Capone, the new head of MoonPay Studios, the vision behind them isn’t. In essence, the company sees fashion as a key to making the metaverse mainstream.
“We think that Web 3.0 is an inevitability, and our mission is to onboard the world,” Capone continued. “Fashion is exciting, because it’s usually at the front of a lot of trends, and it’s usually shaping the way culture moves — shaping actual culture itself.”
A former Creative Artists Agency talent agent and Web 3.0 executive, he innately understands the cultural capital of fashion and entertainment, and the power of their influence on consumer mindsets. “We saw Kanye’s Instagram about Snoop Dogg wearing a Tommy Hilfiger shirt, and that it inspired him more than any other ad or marketing stunt he’d ever seen,” he added. “It went viral, which speaks to a deeper point: Fashion is literally designing the future.”
MoonPay isn’t the only metaverse platform zeroing in on that. Other providers, large and small, have been racing to court brands armed with an array of services. Some merely digitize products or mint 3D files as NFTs, while others develop pop-up stores to showcase them, build out entire multilayered virtual world destinations, stage metaverse events and much more.
For fashion brands and designers, the motivation is evident, both from a creative and business standpoint.
Fashion demands evolution, said Maxwell, who views his MoonPay partnership as a natural step forward, given tech’s continued impact on the world. “This is the new age of digital fashion that breaks the conventional understanding of what fashion can be,” he said. “It’s an opportunity for us to transform, express and embrace more of ourselves, not less.”
Indeed, for designers, there’s creative freedom in a virtual world that’s not beholden to natural laws like gravity or other limitations. The metaverse can look unlimited in a financial sense as well. Gucci, Dolce & Gabbana, Burberry and others have already raked in millions of real dollars from virtual fare, and that’s just for starters. More brands are breaking into NFTs all the time — such as Puma, which just dropped its first digital collectibles at New York Fashion Week. Research firm Technavio estimates that the fashion metaverse will be worth $6.61 billion in 2026, and it pegs that 2022 market growth will jump 30.5 percent year-over-year. Morgan Stanley analysts believe the virtual luxury goods market could fly as high as $50 billion by 2030.
The prospect has spawned deeper and more fascinating investments — from Philipp Plein’s $1.4 million land purchase in virtual-reality platform Decentraland early this year to KNXT, a mysterious Kering initiative that landed on the crypto world’s radar this summer, after a July trademark filing for NFTs, the retail of virtual goods and other metaverse efforts.
The latter seems particularly intriguing. The KNXT website describes itself as a test program for drops, with three main sections: WSPRD, likely a play on “whispered,” offers links to Kering brand products; WYHIWYW stands for “what you hear is what you buy,” at least according to its Instagram account, to connect musical and fashion tastes; and MFDF or a “market for digital fashion” makes for an obvious place to sell Gucci, Balmain or other NFTs from across Kering’s portfolio.
How much of that represents current plans remains to be seen, primarily because KNXT isn’t new. The Internet Wayback Machine shows various parts of the site were online last year, with some pages looking quite different. Previous social media posts and an earlier filing with the U.S. Patent and Trademark Office also suggest that the program is a revamp of a different initiative. The November application described promotions, ads, loyalty programs and community building.
Altogether, it looks like a major overhaul, possibly in response to fashion’s tech center of gravity shifting into the virtual sphere. At this point, whatever that current version of KNXT is appears to be approaching the runway soon.
Of course, the broader question is whether these or any other Web 3.0 projects are actually reaching people beyond crypto kids and investors.
Last month, Forrester’s latest Media and Marketing Benchmark Recontact Survey showed that less than a quarter of online adults in the U.S. are familiar with the metaverse, at 23 percent. The research firm also saw in its Empowered Customer Segmentation study that technical proficiency on the part of the consumer helps, but not as much as one might think. Even among the tech-savviest respondents in this group, less than half claimed familiarity with the metaverse.
“The fact that metaverse familiarity is low even among the earliest adopters of technology means that there’s ample work to be done at the top of the funnel to build out a viable market,” Mike Proulx, vice president and research director at Forrester, wrote in a blog post.
That’s precisely where MoonPay is fixated.
The main fintech business is, in Capone’s words, an “on-ramp” to Web 3.0, as it allows people to buy and sell crypto and NFTs with fiat currency. In other words, customers of the CFDA’s premiere digital collectibles will be able to use familiar forms of payment, such as credit cards, debit cards and even Apple Pay, Google Pay and Samsung Pay.
Behind the scenes, MoonPay Studios works with brands on NFT strategy and development. While that can ensure plenty of virtual inventory to wow consumers, the team — like the fashion brands it works with — focuses on just the right fit to meet their clients’ goals.
“If you’re a fashion designer focusing on luxury, your strategy might be a little bit different than a mass-market retailer who speaks to a different demographic,” elaborated Capone. “We’ll take all of those facets into consideration and craft what we think is a comprehensive and compelling use case for Web 3.0.”
Sometimes, the goal is merely to extend the brand or test creative limits.
“I’ve always seen fashion as a vital creative frontier, with only two things that can limit the collections I design: imagination and physics,” said Hillary Taymour, Collina Strada‘s creative director. The work with MoonPay on her NFT artwork and the Web 3.0 opportunity, more broadly, eliminates one of those constraints. “What’s next will be fresh and exciting — NFTs that speak to the core of our brand, underlining our ethos of social awareness, change and self-expression.”
Like Collina Strada, Brandon Maxwell chose a visually oriented NFT to express his brand, though in video form. In terms of quantity, it was minted to the size of the NYFW audience and delivered via a QR code printed in the show program. Alo Yoga, however, needed more utility for The Aspen Collection, its debut luxury line.
Not that the brand wanted for a tech extravaganza. It partnered with Digital Twinning on augmented reality try-ons in New York. But the NFTs, the brand’s first, needed to bring different elements to the table. Ultimately, they will act as blockchain-based certificates of authenticity for people who buy the physical products, as well as access passes unlocking real-world perks.
Think of it as a VIP club with exclusive benefits that include personalized shopping through a private client manager, access to Alo Wellness Clubs and other experiences at Alo Houses.
“Being able to try the collection in real-time via AR, and receiving an immutable certificate of ownership not only elevates the purchasing experience, but also the authenticity, transparency and security of our products,” said Angelic Vendette, vice president and head of marketing at Alo Yoga. “[It] creates the building blocks to provide lifetime value and rewards to our most loyal customers.”
That’s possible, thanks to the smart contracts baked into NFTs. These bits of software or code automatically execute when certain conditions are met, and because they’re stored in the blockchain, they can’t be tampered with, at least not easily.
Brands have only begun to explore what smart contracts can do, and MoonPay is eager to help them figure it out.
This summer, the company launched HyperMint, a self-serve platform designed to make easy work of minting and distribution NFTs, including smart contracts. For MoonPay, fashion week was a sort of springboard to bring its utility NFTs to the sector, giving maisons an interesting way to build relationships and create exclusive clubs or communities with top-tier perks. It may help that HyperMint, as a self-serve system, can pump out NFTs at scale and even support simplified purchasing via email check-out. Alo Yoga is the first fashion and lifestyle brand to use HyperMint.
Of course, the appeal’s not limited to fashion. Universal Pictures, Fox Corporation and Snoop Dogg’s Death Row Records signed on early, as did CAA, Capone’s previous stomping grounds.
The talent management agency was interested in developing smart contract strategies for VIP clients in entertainment, digital media, publishing, fashion and philanthropy. Shortly after that, in July, MoonPay announced his appointment to lead the Studios business, along with other executive hires. It’s a bold move when crypto plummets and the state of the economy is destabilizing the NFT business, prompting the OpenSea marketplace to shed 20 percent of its workforce.
Then again, it has reason to be confident. After a $555 million Series A round in November valued the company at $3.4 billion, MoonPay revealed in an April blog post that a star-studded lineup of investors had practically thrown its money at the platform. Justin Bieber, Maria Sharapova, Brie Larson, Paris Hilton and many others brought $87 million to the business as part of its Series A.
Hollywood is obviously enthralled. MoonPay hopes Paris and New York will be as well. Because where cultural luminaries go, consumers are sure to follow.