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Adidas NFT Sale Brings In $23 Million
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Hey Friends,
We all know that Adidas is a massive company.
The largest sportswear manufacturer in Europe brought in $22.668 billion of revenue last year — that’s roughly $1.9 billion per month, $62 million per day, or $2.5 million per hour.
But here’s the interesting part.
Adidas conducted its first NFT drop last week, bringing in over $23 million of revenue within minutes and likely operating on much more profitable margins than their traditional footwear & apparel manufacturing business.
Here’s how it worked, according to Cryptobriefing:
The iconic fashion brand’s collection featured 30,000 NFTs for 0.2 ETH each. That would put the money generated by the project’s sale at over $23 million (6,000 ETH).
Adidas’ collection was conducted in collaboration with three big names in the space: Bored Ape Yacht Club, Punks Comic, and gmoney.
The NFT holders will get both physical and digital perks. On the physical side, holders will gain access to physical merchandise in 2022—the “iconic adicolor Firebird tracksuit,” a “graphic hoodie,” and “gmoney’s classic orange beanie.” On the digital side, holders will be able to attend virtual events in the Metaverse throughout 2022 “and beyond.”
The early access sale for the NFTs began on the same day as the public sale, albeit a few hours earlier, with 20,000 tokens reserved for those who qualified for early access and a minimum of 9,620 tokens reserved for the general public (380 of the NFTs were retained by adidas and its partners).
The NFT sale experienced technical difficulties, though, as minting for early access holders was paused for nearly two hours due to failed transactions. But Adidas later tweeted out that gas fees would be reimbursed for failed transactions.
I think there are a few different ways to look at this.
Some might see it as a cash grab. Adidas, a sportswear company that has had a lot of success over the last 70+ years, spotted a growing trend and took advantage of its social & cultural equity to profit from its customer base financially.
Even if they split the money evenly with their partners—Bored Ape Yacht Club, Punks Comic, and gmoney—that’s still $6 million in revenue, or roughly three days of operating profit that was made in just 120 seconds.
But more likely, I think we are starting to see an arms race between today’s top brands.
Companies like Nike, Adidas, Gucci, Coca-Cola, Balenciaga, Burberry, Visa, Disney, UFC, Burger King, Louis Vuitton, Twitter, Instagram, Facebook, the NBA, and others are all actively participating or dedicating resources to Web3 & NFTs.
Of course, part of this is profit. Capitalism still reigns supreme, and these companies have an obligation to their shareholders to maximize profit where it makes sense.
But that doesn’t mean it can’t be done in a way that benefits both parties.
For example, the floor price for Adidas’ collection on OpeanSea is currently 0.8 ETH, or roughly $3,250, representing a 400% gain for NFT holders in less than a week.
The secondary market is a different story, of course, but the truth is that no one really knows what NFTs will look like in the future. Some people will claim it is the next big thing; a multi-trillion-dollar generational shift that is happening right in front of our eyes. While others will say, it is an unregulated securities market that ultimately benefits the same people they set out to eliminate — the elite.
Most likely, the truth is probably somewhere in between. The best companies will continue to innovate, cannibalize their own business where it makes sense, and listen to the community for direction on where to go next.
Still, my guess is that a $23 million sale for Adidas is just the beginning.
I hope everyone has a great day, and we’ll talk tomorrow.
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THE JOE POMP SHOW: My conversation with Rich Antoniello is now live!
Rich served as CEO of Complex for nearly two decades and is transitioning to an advisory role following the company’s $300 million sale earlier this year.
We discussed:
Selling Complex for $300 million
Building a media network over two decades
The craziest things he did to keep the business alive
The future of Bitcoin, crypto, web3, and the metaverse
What he is investing in today & his advice to young entrepreneurs
This was one of my favorites — listen, subscribe, share, and enjoy!
You can also watch the YouTube video below.