Who doesn't like perks, especially when they come in the form of innovative digital assets? NFTs are offering just that — a new frontier in digital ownership where each token opens doors to unique experiences, privileges, and communities.

It’s quite logical that NFTs are still predominantly associated with artworks, as a significant portion of the NFT market indeed revolves around art.

However, the utility of NFTs extends far beyond just digital art. They are also used in areas like gaming, where they can represent unique in-game items or experiences, in real estate for virtual property ownership, in music — for exclusive content and royalties, and even in identity verification and supply chain management.

This diverse applicability can be seen in one of our projects, Circularr, where we assisted our client in incorporating NFTs into their plastic waste management solution. Here, users can earn token rewards for depositing plastic bottles into reverse vending machines (RVMs). These tokens can then be exchanged for discounts, gift certificates, or sold via liquidity pools.

In this project, NFTs are managed through an admin panel, which oversees the ecosystem’s core processes. This includes the minting and selling of pellet NFTs, created from recycled plastic.

Let’s dive deeper into other NFT utility ideas and explore more real-life examples that showcase the versatility and potential of NFTs in various sectors.

What is an NFT utility?

An NFT utility is basically the benefits you get with a non-fungible token, making it more than just a collectible. Think of it like a bonus feature — it could be a special pass to an online event, a key to unlock extra content in a video game, or even a ticket to a real-life concert.

This idea is really changing the game in lots of areas. For example, in the art world, an NFT can prove you’re the true owner of a digital masterpiece. Meanwhile, in music, it might get you into an exclusive listening party or front-row seats at a show.

How to create an NFT with utility?

NFT utility works by adding a special layer of value to your regular NFTs, and creating it isn’t a very complicated process at all. It involves just a few steps:

1. Conceptualize your NFT’s unique utility

Brainstorm a compelling idea that defines what your NFT will provide. For instance, it could grant access to an exclusive online community, be exchangeable for a special physical product, or offer a unique service.

An effective method to add value to your NFT is by making it redeemable for a valuable item or service, whether it’s something physical or a digital advantage.

2. Launch NFTs on a platform that supports the utility

After you’ve decided on your NFT utility, the next step is to pick a suitable blockchain platform. The platform should easily incorporate special features, like exclusive content or redeemable items, right into your NFT.

Blockchains like Ethereum, Binance Smart Chain, or Flow are among popular choices, each offering unique capabilities for embedding utilities into non-fungible tokens.

When creating your NFT on one of these platforms, you’ll use smart contracts — self-executing programs with the terms of the agreement directly written into code. They are essential for automating the delivery of your NFT’s special features, ensuring that the promised utilities are executed reliably and transparently whenever the NFT is bought or transferred.

3. Promote your NFTs with utility

In the final step, it’s key to spread the word about what makes your NFT special.

Share the details on social media, with your crypto community, and on NFT marketplaces. People must understand not just what your NFTs are about, but also the utility behind the tokens and how to use and benefit from them.

What are the types of NFT utility?

Most NFT utilities can be categorized into five types: voting rights, special offers, exclusive material, events, and gamification. Let’s take a closer look at each of them:

Voting rights

This NFT utility empowers its holders to participate in decision-making processes. With voting rights NFTs, holders can have a say in specific matters, such as:

Selecting themes for digital art collections
Determining new functionalities in a software update
Choosing locations for community events
Deciding on new product lines
Shaping policies for platform governance

For businesses, offering these tokens can lead to increased engagement and loyalty, as it allows users to directly influence decisions in their favorite projects.

Special offers

Special offer NFT utility provides holders with exclusive deals, for instance, discounts or access to products and services. These can include early access to sales, reduced prices on future purchases, or exclusive product bundles.

Special offers through NFTs act as incentives for purchases, driving repeated engagement and potentially attracting new customers.

Exclusive material

These NFTs can unlock exclusive materials, either digital or physical, which are not available to the general public. For example, these can be unique digital art, unreleased music tracks, rare videos, articles, or even physical items like books or merchandise.

By offering such VIP content, businesses can tap into an additional revenue stream and strengthen brand loyalty.

Events

Event-related NFT utility grants access to unique experiences, such as real-life or virtual events in the metaverse. This can be meetups, conferences, or online webinars. If it’s an entertainment platform or celebrities launching NFTs, holders might also enjoy benefits like tickets to concerts and exclusive events, VIP passes, or special meet-and-greet opportunities.

For businesses, these events can boost community engagement, provide networking opportunities, and promote the brand. Meanwhile, users can access unique experiences and engage with communities or interests they are so passionate about. It’s definitely a win-win.

Gamification

Gamification NFTs present holders with challenges, rewards, or special features within digital games. This could mean in-game bonuses, exclusive missions, or unique in-game items that may cost big bucks later.

From a business standpoint, gamification can significantly increase user engagement and time spent on the platform. For users, this results in a more entertaining experience, often accompanied by a sense of achievement or exclusivity. This is exactly what all gamers are looking for.

The most popular examples of NFT utility

Let’s explore various examples across industries so you can select the best NFT utility for your business.

Fashion collaborations

Brands can offer unique fashion items, either digital or physical, and provide special benefits like exclusive access and experiences in the form of NFTs.

Imagine owning a digital asset that not only signifies your taste in fashion but also serves as a key to virtual fashion shows, designer meet-and-greets, or early access to limited-edition collections.

Furthermore, fashion NFTs can be used as a tool for authentication and proof of ownership, especially taking into account that the industry is plagued by counterfeits.

Tiffany & Co. X CryptoPunk

In August 2022, American luxury jewelry retailer Tiffany & Co. introduced a collection of 250 tokens known as NFTiffs.

Priced at 30 ETH each, or approximately $50,000, these NFTs offered an exclusive opportunity for CryptoPunk NFT holders to convert their digital tokens into physical pendants. Each pendant was a customized creation, adorned with gemstones and diamonds. They represented the unique NFT utility — tokens backed by real-world items.

The entire collection was sold out in just 20 minutes. This launch not only generated significant revenue, amounting to $12.5 million but also demonstrated how NFTs can seamlessly connect the realms of digital art and physical craftsmanship.

Sports enhanced by NFT utility

In the sports industry, the integration of NFT utility offers a novel approach to fan engagement and asset management.

NFTs in sports can take various forms — from digital collectibles to authenticity certificates for memorabilia. Fans can own limited edition trading cards, highlight reels, or virtual merchandise, each with a unique digital identity verified on the blockchain.

In addition to this, NFTs can be used to grant special access to events, behind-the-scenes content, or unique experiences. For athletes and teams, NFTs provide a new and innovative way to monetize and manage their brand, establishing a direct connection with their audience.

Sorare

Sorare transforms the world of digital collectibles through its unique NFT utility. Here, users can dive into a multifaceted experience with their NFT-backed cards that feature players from top soccer clubs and leagues such as the Premier League, Bundesliga, La Liga, and Serie A.

Users can purchase these NFT cards to treasure them as rare collectibles, but their versatility extends further. They can be used to participate in online games and tournaments directly on the platform, as well as transferred to other applications, sold, traded, or even integrated into different games outside of Sorare.

This flexibility is a game-changer, offering a dynamic way for nearly 4 million users to interact with their favorite sports and players.

NFT-enabled identification

Unlike traditional identification methods, NFTs can provide a unique, non-fungible token for each individual, thereby ensuring a high level of security and authenticity.

This form of blockchain-based identity verification can be used in various sectors, from access control in secure facilities to verifying credentials in education and online transactions. NFTs can store essential data like biometric information, which is encrypted and securely stored on the blockchain, making it nearly impossible to forge or tamper with.

This NFT utility streamlines the process of identity verification and gives individuals full control over their data. Meanwhile, everyone still has the right to choose when and how their identity is shared.

Sungkyunkwan University, South Korea

Sungkyunkwan University, a private research university in South Korea with campuses in Seoul and Suwon, was the first in the country to use NFTs for academic credentials. The university issued NFT-based certificates to three students who won in-school competitions. This happened during their online graduation ceremony.

Looking ahead, the university is not stopping at just digital diplomas: they plan to expand the use of blockchain technology to streamline various administrative services on campus.

Other South Korean educational institutions, such as Soongsil and Chung-Ang University, are also embracing this technological shift. They have partnered with local blockchain developers to integrate NFT and metaverse technologies into their graduation services.

Membership NFTs

Membership NFTs allow owners to gain entry into exclusive groups and communities where they can network and share insights.

These NFTs also grant access to private events such as retreats and parties, and often provide entry to future NFT projects from the same creators, ensuring that members are always at the forefront of new releases and developments.

Flyfish Club

Flyfish Club (FFC) by VCR Group is pioneering the fusion of exclusive dining and blockchain technology as the world’s first private dining club accessible only through an NFT membership. Located in an iconic New York City venue, the club spans over 10,000 square feet, featuring a cocktail lounge, upscale restaurant, omakase room, and outdoor space.

Users can purchase a membership on Rarible, followed by creating a profile on the restaurant’s website to verify ownership. The standard membership costs 1.35 ETH, which is around $3,000. It grants access to the club’s facilities, with the flexibility to choose table sizes and bring guests. However, food and beverage costs need to be paid separately.

For an elevated experience, there is the Flyfish Omakase membership, priced at 188 ETH (about $420,000). It includes all standard benefits plus exclusive access to the omakase room. Both memberships operate on a first-come, first-served basis and represent a blend of luxury dining and digital collectibility.

NFT tickets to events

NFT tickets are transforming access to events, merging digital innovation with exclusive experiences in both physical and virtual worlds.

In real-life events, such as concerts or sports matches, NFT tickets provide more than just entry — they offer unique benefits like meet-and-greets or exclusive merchandise, all secured by blockchain’s tamper-proof technology. These tickets also serve as memorable collectibles.

In the digital world, especially within the metaverse developments, this NFT utility becomes a gateway to extraordinary virtual experiences. For instance, owning an NFT ticket might allow you to interact with a celebrity’s avatar in a virtual setting or gain entry to an elite digital club.

Coachella

Coachella, a renowned event in the music world, embraced the NFT trend by launching the Coachella Keys Collection. This collection consisted of 10 unique NFTs, each offering a unique NFT utility — lifetime passes to the festival for one weekend every April, along with various amenities like luxury camping and gourmet meals. The auction for these tokens lasted for one week in February 2022, with the collection selling for almost $1.5 million.

The most expensive NFT in the collection was the Infinity Key. It was sold for $270,000 and included lifetime Coachella guest passes, all-inclusive culinary experiences, and private transportation. Another notable NFT, the Key to the Safari, was sold for $256,000 and offered luxury camping accommodations.

Utility-backed airdrops

Utility-backed airdrops add a delightful layer of value to NFTs, transforming them into more than just digital art pieces or collectibles.

As an NFT holder, you often receive airdrops as a bonus, which can unlock a variety of benefits. These rewards typically include exclusive access to digital content, invitations to special events, early previews of upcoming digital projects, or even potential opportunities to earn passive income in the future.

These airdrops serve as a token of appreciation, enhancing the experience of being part of the NFT community.

Smart Beast — Rises

The “Smart Beast – Rises” NFTs were dropped and available for purchase from January 11 to January 18, 2024. This unique collection, consisting of 3,069 digital beasts, was hosted on both Ethereum and Binance platforms.

During the sale, the creators assured their future NFT holders that these digital beasts would generate ongoing revenue for their early adopters.

Loyalty programs and rewards

This NFT utility means the tokenization of loyalty rewards, which allows businesses to create exclusive, collectible items that incentivize repeat purchases and strengthen brand connections.

Such digital tokens can represent special discounts, early access to new products, unique experiences, or personalized items, thereby enhancing reward value. This innovative method drives customer loyalty and adds an element of exclusivity and fun, making the collection and redemption of rewards more engaging and memorable.

Lacoste

In November 2023, Lacoste launched a new virtual store in collaboration with Emperia to enhance customer engagement with its NFT-based UNDW3 loyalty program.

The store, showcasing Lacoste’s summer collection, offers a unique digital experience, including a journey through a virtual beach and crocodile-themed environments. It features exclusive areas for Le Club Lacoste and UNDW3 members, where they can access special NFT collections and rewards.

A highlight is a members-only room for UNDW3 NFT holders, offering “loot” boxes and daily prizes. This innovative approach by Lacoste set a new trend in retail customer engagement.

Conclusion

NFTs have evolved far beyond digital art and collectibles, presenting a myriad of utility options limited only by creativity and innovation. Whether you’re intrigued by the concept of NFT-backed identification, the potential of NFT tickets for exclusive access, or you have your own NFT utility ideas, the blockchain landscape offers a dynamic playground for exploration.

At PixelPlex, we are dedicated to helping you bring your NFT vision to life. Our NFT development services encompass a wide range of possibilities, from creating custom NFT platforms to integrating NFT functionality into existing systems.

With our hands-on expertise and commitment to excellence, our blockchain company is here to transform your NFT utility dreams into reality.