The illusion of web3 innovation in large consumer brands

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Last month, rumors swirled that Nike might shut down RTFKT, the innovative digital sneaker brand it acquired for a staggering $1 billion in 2021. Although the speculation turned out to be unfounded, it triggered a deeper thought: Are web3 with its promises of decentralization and digital ownership really offered to consumer brands? My answer is a resounding no.

Major consumer brands are too rigid and risk-averse to effectively innovate within this new paradigm. They adopted Web3 mechanics superficially, motivated by short-term financial gains rather than true technological integration. As a result, they failed to find a meaningful product-market fit.

Failure of big brands to innovate

Large consumer brands are known to be very slow to adapt to new technologies. Kodak, the pioneer of digital photography, stayed in the film business and missed the digital revolution. Blockbuster ignored the rise of online streaming and paid the ultimate price. Similarly, today big brands are repeating these mistakes on web3. They are dabbling in NFTs and blockchain not out of a genuine desire to innovate, but as a reactionary move against market trends. This superficial adoption lacks the depth and understanding needed to leverage web3’s full potential.

From a philosophical perspective, this failure to innovate stems from the nature of large corporations. By design, these are hierarchical and centralized structures that prioritize stability and predictability over experimentation and risk-taking. In the Deleuzian sense, they are striated spaces that are rigidly organized and resistant to change. Web3, on the other hand, represents a smooth space, a space of decentralization and fluidity. It’s no surprise that big brands can’t navigate this space; This is against their essence.

Superficial adoption of Web3

Nike’s acquisition of RTFKT was heralded as a bold move into the digital world. But despite the initial excitement, Nike struggled to integrate its innovative spirit into its broader strategy. Recent shutdown rumors underscore a broader problem: big brands are adopting web3 technologies for their financial potential, not for real innovation. The result is a series of half-hearted projects that fail to resonate with consumers.

This superficiality goes beyond Nike. Louis Vuitton’s foray into Blockchain for product authentication did not significantly impact consumer engagement, although it was in line with the brand’s emphasis on luxury and authenticity. The use of blockchain here is more of a marketing gimmick than a transformative tool. It is a simulacrum of innovation, an empty signifier devoid of real meaning.

Louis Vuitton’s NFT initiatives

Louis Vuitton has launched several major NFT initiatives, including the “Louis: The Game” mobile app celebrating the brand’s 200th anniversary. In this game, players help mascot Vivienne collect NFTs designed by famous artist Beeple. The game aimed to educate and entertain players while introducing them to the rich history of the brand. Despite reaching over two million downloads, its impact on consumer engagement is still debatable as NFTs are non-transferable and serve primarily as collectibles without wider use.

In a more recent venture, Louis Vuitton introduced “VIA Treasure Trunk” NFTs priced at around $41,000 each. These NFTs, linked to physical bodies, target the brand’s premium customers, offering exclusive access to customizable products and early releases. However, this approach highlights the brand’s focus on exclusivity rather than democratizing access to digital ownership.

The real potential of web3

The promise of Web3 lies in its ability to democratize digital interactions and ownership. However, this potential is largely untapped by big brands. The true pioneers of Web3 are smaller, more agile companies that can take risks and innovate without the burden of bureaucratic inertia. At the forefront of this innovation are brands such as 9dcc and RTFKT (in its original form). Founded by crypto entrepreneur Gmoney, 9dcc integrates NFTs into high-end fashion, creating a seamless blend of digital and physical experiences that truly resonates with consumers. These companies are experimenting with new ownership, community engagement and digital experience models that big brands can’t or won’t follow.

In a way, these small players are nomads of the digital world, navigating the smooth space of web3 with ease. They are not bound by the boundaries of the corporate structure and can thus explore the full potential of this new frontier. These embody the Deleuzian concept of the rhizome, a decentralized, non-hierarchical system that can grow and adapt in any direction.

The future of Web3 and consumer brands

For Web3 to reach its full potential in consumer applications, leadership needs to come from these small innovators. They’re the ones pushing the boundaries, testing new technologies, and finding real ways to engage consumers. Big brands, on the other hand, need to realize their limitations and perhaps look to these smaller players for inspiration.

Web3 is not just about applying an NFT to a product and finalizing it. It’s about rethinking the entire consumer experience, from ownership to engagement to value creation. Until big brands understand this, they will continue to miss the mark and the true potential of web3 will remain unrealized.

The philosophical implications are clear: the future belongs to those who can navigate the smooth space of web3, not to those who cling to the striped structures of the past. It belongs to nomads, rhizomes and innovators who are not afraid to try and fail. It belongs to those who understand that true innovation is not about financial gain, but about pushing the boundaries of what is possible.

Ultimately, the failure of major consumer brands to drive web3 adoption highlights a fundamental truth: innovation requires more than financial investment. It requires a willingness to take risks, experiment, and truly understand the technology. Until big brands adopt this mindset, the future of web3 will be shaped by the bold, agile and truly innovative.

The question is not whether web3 will transform consumer experiences, but who will be at the forefront of this transformation. I believe the answer lies in the decentralized, fluid and infinitely creative world of the small and agile. The future is in their hands.

Gleb Sychev

Gleb Sychev is a multidisciplinary creative, artist, web3 innovator and marketing expert who currently holds an entrepreneurial role as the founder and CEO of Swarāj, a trans-fashion avant-garde brand pioneering the concept of ‘digitalisation’. He also contributes as a co-founder of The Selfrule Organization, an organization focused on the research and development of products in a wide variety of emerging technological fields. Before launching Swarāj, Gleb spent seven years in the cryptocurrency space; She most recently served as chief marketing officer at 1inch Network, where she led marketing efforts. During his tenure in crypto, he has been a featured speaker at leading industry events such as ETH Denver and DAO Tokyo. With his diverse skill set and ability to bridge the gaps between technology, creativity and business, Gleb is well positioned to make meaningful contributions to the web3 space and beyond as we build Swaraj into a successful startup.