Have you been thinking about NFTs for your business? Do you want to provide exclusive access to NFT holders but don't know how?
In this article, you'll discover why and how NFTs open up new business models that weren't previously possible.
How NFTs Can Transform the Membership Experience
Although membership-based websites appear to have been working just fine for a long time, if you look closely, you can see a lot of fundamental flaws around the current model.
For all its potential, the internet is really powered by a few business entities—Facebook, Google, and Amazon. There are plenty of people making good money on the internet but even they are dependent on these tech giants and are paying them to be able to do business. That payment could be in the form of data extraction, advertising, membership fees, or bandwidth, but they are paying.
Additionally, a large tech company, Apple, made one singular change to their users' privacy and data handling, and that change kicked off an enormous drop of almost 30% in another large tech company, Meta's Facebook.
Anytime a large corporation makes a singular change in its own business model that can have a significant impact on another company's business model, that's a sign of its fundamental weakness within the model. Typically, if a business makes a change, it only affects that business. Any other companies don't have to worry about corporate-level fallout as a result of these types of changes.
Quite frankly, people are tired of the friction that these entities have caused in their internet experience. You can measure how tired they are just by seeing how many are shutting down their subscriptions, closing accounts on different websites, and using ad blockers to change their experience on certain websites. People are tired of having to sign up, pay separately, remember passwords and domains, and continually jump through hoops to be able to take advantage of the membership they want to sign up for.
Not only are people sick of the friction, but they don't understand why the friction exists in the first place. Who are these companies serving? Are they members or clients? Are they users or products? Today's membership-based business models aren't set up to serve the members and they know it.
By changing your membership business model to an NFT (non-fungible token), you can remove nearly all of that friction. Anywhere you can connect to your members' wallets, they can find your content. And they don't have to remember a password to get into it. All they have to do is connect their wallet, and then the smart contract on the back end will check if the required NFTs are there and unlock whatever content that NFT holder has access to.
It's very similar to someone who has an AAA card or is an AARP member. They have these membership cards that they can bring to various flights, hotels, and car rentals. Anywhere they see a potential benefit for being a cardholder, they simply go up and show the card to receive the benefit. It might be an upgraded suite, private tickets to somewhere, or a discounted room. That person doesn't have to jump through any extra hoops to get to it.
NFTs can create the same easy experience anywhere you want to connect with your members. If you want to create special content on your podcast or blog, you can do that without forcing people to log into your blog. You can also send them over to your Discord server, your Shopify store, or anywhere else you want to offer them a special benefit. They don't have to remember yet another login to make it all work.
So you're enhancing their experience on the internet with you, giving them the value of being a member of your community and an NFT holder, and you're able to do it all without the complicated administrative back end of trying to manage and audit your memberships. If someone is done with your membership, they can simply sell the NFT to someone else.
Everything on the back end will smoothly and automatically transfer over without the need to call you or set up any new accounts or change anything over.
How Ownership of a Membership Works
In the current business model for memberships, people simply pay for access to that membership. They don't actually own that membership and the only thing they control is whether they continue paying for the membership.
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But with an NFT-based membership business model, members actually own their subscription. If it's a recurring subscription, then they lose access to those benefits once they stop paying. But otherwise, the membership itself is still there. Even if they want to stop paying, they can still sell the membership to someone else they believe will get value out of it. This is helpful to both you as the business owner and your membership subscribers.
If they're done with their membership, either because they've gotten everything out of it that they need or are trying to save money every month, or whatever, if they can sell the membership to someone else, you don't have to go find a new client.
The first member already found your next client, and you got a percentage of the sale that they made by selling the NFT. So you aren't even out any money. Nor do you have to spend the administrative time or overhead trying to manage the membership, changing payment methods, setting up a new member, or changing email addresses. The access and everything else is done for you, and all you have to do is make sure that your system is set up for any onboarding you need new members to go through.
That's the beauty of owning your membership. Once you're done with it, you can find another buyer to sell it to. That's buying a house versus renting an apartment or buying a paperback book versus buying an eBook on Kindle. Once you own the NFT, it's yours to do with as you please.
Unlock Ownership of Your Membership With the Unlock Protocol
The Unlock protocol is an application that allows you to build an NFT-based membership model into your existing tools. The first step is to create your membership contract on the Unlock Protocol website. They have a dashboard to help you with this step.
You can set up your contract your way, and you have complete control over that contract. The Unlock protocol doesn't own or control any part of the contract you build.
Once you've built the contract that serves as your membership, then it's time to get it connected to all of the features you want your members to have access to. For this article, we're going to focus on the WordPress integration because it's a widespread content management system that a lot of people use to start their membership businesses; however, there are several other integrations available as well.
Install and Use the WordPress Plugin
Once you've written up the contract for your membership, head over to your WordPress site and find and download the Unlock Protocol plugin.
This plugin creates a lock over certain areas of your site and works seamlessly within it. You can create an entire article for members only or choose to have specific blocks within the WordPress editor hidden behind the lock. You can even establish different levels or tiers of your membership and allow the lock to guard the different levels.
Once you're done, you hit Publish just as you normally would.
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When your readers visit your website, they'll see the content you've set as available to the public. However, once someone has connected their wallet to your site, the Unlock Protocol plugin will check to see if their wallet is holding the required number of your NFTs to unlock the content for them to see.
If your NFT-based membership is set up as a recurring payment, then Unlock Protocol will also check to see if their access has expired. If their access has expired, Unlock Protocol will prompt them to renew their membership under the terms of the smart contract you set up before granting them access to the content.
Decide Whether to Allow Transferability
Another interesting thing you can do with Unlock Protocol as you set up your NFT membership is you can decide whether you want to allow people to transfer time off of their membership.
In other words, if your membership is run as a 30-day membership, you could allow your members to transfer one of those days to someone else. This would leave them with access for 29 days while allowing someone else access for 1 day. And after that day, that person may even purchase their own membership.
The same functionality also works on mobile with the MetaMask mobile app. People can connect to your site right there on their mobile device the same way.
As we mentioned before, Unlock Protocol offers integrations with several tools besides WordPress. To date, these integrations include Drupal, Webflow, Cloudflare, Discord, Discourse, Decentraland, and Shopify. And they've posted that any other platform that would like to build an integration to Unlock Protocol will be supported.
6 Business Use Cases for NFT-Based Memberships
To date, Unlock Protocol has helped several businesses build their NFT-based memberships with some interesting features and use cases.
Bakery.fyi is a website built on WordPress where they publish valuable content about Ethereum and the blockchain space. Some of these articles are created behind a paywall called the Chef's Menu. These hidden articles are the meatiest you can unlock with your Bakery DAO membership.
ZED Run digital horse racing is a website that aggregates all of the data about the virtual races and makes predictions. Visitors to the website can unlock and access those predictions for the next virtual race.
ECC, the biggest Ethereum conference in Europe, uses Unlock for tickets. And what's really interesting is that ECC is able to combine members' online and offline experiences. So the conference tickets have a QR code that attendees show at the gate to get in, but with that NFT in their wallet, they also have access to private Discord servers, private Telegram rooms, or even some custom experiences such as voting for the next keynote.
Tale of Ronin is a gaming website where players can create an avatar as part of their membership. Members can buy swords, shields, and other pieces of equipment through other memberships, and avatars evolve based on all of the other memberships they have. This is a fascinating way to bring multiple memberships together into one experience.
LIT AF is a podcast that uses Unlock to hide certain episodes behind a paywall.
Certified Digital Asset Advisor (CDAA) is using an NFT as a certification that members can earn once they're certified as a financial analyst through their process. For this one, members can't buy the NFT; they can get it by earning their certification, and once earned, the NFT doesn't expire for a year.
Predicting the Future of NFT Memberships
Cryptocurrencies, Web3, and NFT-based membership models are going to be much more prevalent in the near future. It's going to become the way of building technology. Users and developers collectively own this technology, helping to decentralize memberships even further. We're going to see businesses moving away from Silicon Valley owning everything over to a model where their users own their own memberships.
We're also going to see the strengthening of businesses and consumers in many ways. No longer will one business be able to fall victim to another business making a decision about their own client handling.
Julien Genestoux is the founder and CEO of Unlock Inc., an entity that helps creators monetize with NFT memberships. He also created the Unlock Protocol and Unlock DAO. Find Unlock Protocol on Twitter @UnlockProtocol and find Julien on social media platforms with the username @Julien51.
Other Notes From This Episode
- Check out MetaMask, WalletConnect, Ethereum, Solana, Polygon, Decentraland, Unity Protocol, Gnosis Chain, BNB Chain, Optimism, Bakery.fyi, LIT AF podcast, ECC, Tales of Ronin' Realm Ronin membership, ZED Run digital horse racing, and CDAA.
- Connect with Michael Stelzner at @Stelzner on Instagram.
- Watch the interviews on the Crypto Business YouTube channel.
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