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The IADS took the opportunity of the 63rd General Assembly in Geneva to issue POAPs (Proof of Attendance Protocols) to member CEOs as a virtual representation of their 2022-2023 membership as well as POAPs to the graduates of the 2022 Academy Program as a virtual certificate of participation. The inspiration for this activity was to be able to learn by doing and put ourselves in the shoes of our members as they face questions about Web3 and its various applications. The following synopsis is a look into our Web3 journey as well as the takeaways we gathered from the experiment.

Introduction: testing the waters

As retail adopts more technological advancements to create a greater omnichannel experience, IADS felt that it was an ideal time to experiment with Web3. Our team began with questions, considering what our members might also be asking when deciding on their latest digital strategies: How can this technology work for us? What could it be? What would it cost? How would we distribute it? How does it add value for our members/community/customers?

After an initial brainstorming session, the team created a list of possible applications without constraints on whether the ideas were feasible:

•    Celebrating member achievements with a yearly POAP leading to a page that highlights individual accomplishments (think of Spotify Rewind)

•    A virtual hall of fame in the metaverse that includes current and former IADS members who made big impacts

•    POAP for events/membership that can grant access to a ‘vault’ of all our archives and data gathered over the years

•    Discord for members to exchange with separate channels per department and activities (i.e., Merchandising channel, PL channel, Academy channel etc.)

•    Member Stories – a ‘jukebox’ with members sharing how they solved a problem, a funny story, hopes for their company, etc. (similar to a short podcast; adds a fun part to the immortalization idea & gets members involved in a new way)

•    NFT awards – annual recognition tokens that signify exemplary retail achievements (i.e., ‘Most Sustainable’)

•    NFTs that are sold to the general public (if we go toward a more capitalistic strategy)

•    POAP for academy completion (leads to a gallery of photos from Châteauform and their presentation)

•    Virtual news map – inside a metaverse platform like Decentraland to make getting informed more fun and exciting

Once our extensive research and concept proposals had reached exhaustion, the team moved to make a selection between two possible starting points: a digital asset strategy or a metaverse strategy, both with a short- and long-term plan. We again narrowed the selection down to keep the strategy realistic and within budget. The process included discussions on how we could leverage our understanding and research on innovative technology to bring IADS to the forefront of digital retail knowledge (adding hands-on experience to our practical knowledge). As part of our inspiration, we revisited what IADS stands for. The team listed the reasons for creating NFTs based on four principal functions of IADS: Communication, Support, Organization, and Certification. Aside from trendiness, NFTs and POAPs can function as methods for protecting sensitive information, Discord servers, Google forms, websites, or VIP events online and off – perfect for what we do. While the initial focus of our strategy was broadly based on the sale of NFTs, due to the complications of monetizing data and navigating unofficial tax regulations, our team moved in a different direction. This will be expanded upon later in the text.

Metaverse: a more gamified approach

The concept of a metaverse is currently very popular and offers many opportunities for brands and retailers to strengthen consumer loyalty. This portion of Web3 activity has some of the most exciting applications: the integration of gaming and discourse channels, the development of functional virtual storefronts, VR events, and the integration of data into a virtual world. While IADS did not choose to move in this direction, it is still a potential avenue for experimentation. Of course, digital teams must be agile and create a strong roadmap with key points for transition.

When considering this path, the team asked practical questions: What would our metaverse look like? Why would people visit? What features would be offered? Where would it be? How much would it cost to build and maintain?

Due to the current lack of interoperability across metaverse platforms, IADS was hesitant in pursuing this strategy. Investing both time and financial resources in a strategy that does not fully serve our members and is not guaranteed to last was deemed unwise. In light of IADS’ capabilities, a virtual storefront would be the most feasible option from our team’s proposals. However, due to financial barriers and limited technical experience, it was determined that this virtual location would not be a fully functional storefront. Thus, we moved in a different direction.

Virtual land on the popular metaverse platform Decentraland costs around USD 3,000-15,000. After, the fees to have a software developer or programmer build and test a virtual store in Decentraland would cost between USD 20,000 and 36,000. Having an in-house developer would also be expensive at USD 75 to 175 per hour.

According to our research, setting up a functional virtual store also requires a tremendous amount of time. Our team discovered that it takes around 3,040 hours to register your virtual crypto-based business on the digital network of Binance, which could cost around USD 228,000 to 532,000 (for an in-house developer). Another popular platform, Cryptovoxels, does not appear to be cheaper. Famous voxel architect, Bileca quotes USD 10,000 to 300,000 for a full build. Unfortunately, verifying credentials when choosing an architect also appears to be a challenge, making this option better for companies with the proper internal team that has more funding and lower risk aversion. A deep understanding of gaming and metaverses would also be beneficial.

POAPs: certification & commemoration

A short-term digital asset strategy became the most realistic for IADS. The final proposal was a POAP for member CEOs (a virtual representation of membership), and a POAP for Academy graduates.

POAPs are a type of NFT which stands for Proof of Attendance Protocol and can be described as an ecosystem for preserving memories. A POAP is a digital record for the holder that acts as proof of events that they attended or participated in, whether physically or virtually. Because POAPs are technically NFTs they have the capability to act as a utility for potential future events or product drops. They can be compared to any collectable such as the ticket stub for a famous concert or a band tee from the start of a musician’s career - proof you were there or proof of your fandom.

We believe POAPs provide the most relevant qualities for our mission. Our Academy program, which was established in 1995, seemed like the ideal way to begin fortifying our seal of approval through POAPs. As an association that is approaching its 100th anniversary, our expertise in retail insights and innovation certifies the skills development that Academy members receive upon completion of their project.

Another benefit of POAPs is that they are free to mint. For the creation of general NFTs, the cost can vary tremendously depending on the gas fees - a cost incurred from minting as one would mint fiat money. The cost can change hourly and based on the demand, the platform/marketplace, and the cryptocurrency selected. In general, selling on OpenSea, an NFT marketplace, requires two initial payments for creators: USD 70-300 to establish the account and USD 10-30 for OpenSea to be given access to generate your NFTs. Alternative sites exist, one of which is Rarible. The Rarible marketplace platform offers a lazy minting feature that makes creating NFTs free and diverts the gas fee cost onto the buyer. The platform also takes 2.5-5% of the final sale.

Once the team began creating the POAPs, the co-founder of POAP France, Sebastian Orellano, reached out to inquire about our motivations and goals as it was quite an unusual use case for his team. POAP France has assisted luxury fashion companies to distribute POAPs at their events such as Christian Louboutin at Paris Fashion Week this year. Following a meeting with him, he offered some insight into how he can assist us and our members. Thus, those who have questions can contact the Association to learn more or to be put in touch with him.

Ultimately, we distributed the POAPs through printed QR codes that were distributed during the IADS General Assembly. Sebastian also recommended incorporating NFC (Near Field Communication) tags into our strategy to better distribute to users that are unfamiliar with crypto wallets and digital assets. While it was too late in the process to incorporate NFC tags, we are considering this for any future initiatives IADS might launch to create a physical and virtual representation of membership or certification.

Going forward: challenges & opportunities

Looking toward a long-term goal, we believe it would be necessary to develop a method of separating monetizable non-sensitive information from private insights that should only be accessible to our members. This path would likely mean creating NFTs for purchase that commodifies our research and reports, such as our lists of emerging brands determined during our IADS Visual Merchandising Meetings. This would involve more work developing a business-focused production of these elements by creating an internal IADS position responsible for Web3 activities. The current membership structure poses an issue for pursuing the sale of NFTs as it might require constructing a complex hierarchy of subscription levels. As a non-profit focused on connecting and supporting our members, this goes against our values. The most tangible monetization of IADS activities is through our city guides. This idea is still being explored through pay-wall map platforms that can organize specific locations based on tags.

Another complication came from the unclear legal and regulatory framework in place for Web3 activities: To whom and how do we report virtual earnings? Will we sell securities or utilities? Do we need an accountant specialized in the Metaverse and crypto? What resources and team capabilities do we need?  Where is Web3 going?

We understand that the Association is not expected to carry out such activities, however, we consider ourselves a research lab, and therefore, felt that this emerging trend would be perfect for experimentation. Our conclusion: it does not have to be intimidating. Web3 specialists are eager to assist companies with entering this emerging digital space. With so much potential, we recommend exploring how Web3 can work for you, within your teams, and for your customers.

This initial trial of POAPs for IADS showed us the importance of understanding the different levels of familiarity with Web3. Ideally, this can be addressed by providing enough time to educate and assist newcomers. Digital innovations can be intimidating, and it can be tempting to wait for the trend curve to reach its peak. Yet, waiting does not equal eventual understanding. To best attract young consumers, being educated on the future discovery and shopping channels they will use is imperative to securing their loyalty. IADS will continue to provide insight and education on digital innovations and hope to connect you further with POAPs, NFTs, and all the exciting new Web3 developments.

Credits: IADS (Devon Blowers)