When it comes to exploring new markets beyond the scope of your industry, it is imperative to do your due diligence before releasing a new product. While most brands tend to research their target audience and explore the culture, Porsche was met with harsh criticism for doing the exact opposite. Following their initial debut into the NFT space, “PORSCHΞ 911” was not an instant sell-out in the primary market, as the luxury automakers would have hoped.
By only promoting the project through marketing campaigns via Twitter, there was very minimal communication on Discord, which is the epitome of NFT culture in terms of community building and sharing a project’s roadmap. The lack of awareness and failure to establish a community led many to believe that this project was just another ‘cash grab’ for Web2 companies trying to profit off of the Web3 audience. Porsche’s first NFT drop commemorating the carmaker’s beloved 911 model, did not seem to promise any deliverables outside of allowing holders to create a personalized, 1 of 1, digital 911 with the designs offering a “combination of unique license plates, different backgrounds, colors, and design elements based on the directions provided”.
With a lack of transparency about the utilities offered, Porsche’s initial minting was underwhelming. With three “waves” of the minting process, many crypto and non-crypto natives were equally confused about how to mint their own customized digital Porsche 911. Unlike their upper-echelon counterpart, Tiffany & Co., Porsche simply lacked the bandwidth to personally onboard 7,500 buyers for their initial launch.
To add to the shaky release, the initial floor price of .911 ETH for the 7,500 token collection crashed below floor price in the first 24 hours. Porsche’s NFT team swiftly reacted to the controversy surrounding the launch.
An Idle Launch to a Shock in Supply
An important component in the NFT experience is providing enough rarity and utility attached to the tokens. Without the proper incentives and scarcity in supply, buyers had little reason to invest in the tokens, which may have been the explanation behind the project dropping below the floor price. In an effort to save the launch from more tyranny, the luxury carmakers halted the mint at 2,363 tokens, which led to a supply shock.
While many were dancing on Porsche’s grave earlier this week, the handful of seasoned NFT degens (and lucky buyers) who took the time to “ape in” and sweep the PORSCHΞ 911’s beneath floor price, were able to resell them on the secondary market for over double the minting price.
After the sudden change in supply, PORSCHΞ 911 quickly jumped to the #1 spot for highest trading volume on OpenSea. Although the floor price is currently experiencing major volatility, at the time of this writing, the collection’s floor price is roughly 2.02 ETH, with the highest token selling at 9.18 ETH.
Some went to Twitter to accuse Porsche of price manipulations and even wash trading, because of how the floor price skyrocketed inorganically. The NFT community may have been critical of the German automaker, but this launch only further emphasized the importance of strategic planning and researching before entering unknown territory.
Porsche Attempts to Recoup
Without a strong community base or establishing a solid roadmap to lay the foundation for their project, Porsche took their efforts to their Twitter in an attempt to weather the storm.
Two days after the fumbled launch, Porsche announced that they would offer a wide range of exclusive experiences for NFT holders, including: access to exclusive experiences with Porsche insiders, a co-creation of Porsche’s future in Web3, an exclusive capsule collection with physical items, the opportunity to customize a virtual Porsche 911 with over 150k possible design variations, access to exclusive events with the Porsche products for most holders, and the chance to receive a private airdrop designed by Porsche’s partner artists.
Take Your Project from 0 to Success with Chain NFTs
Through effective marketing campaigns, and identifying market opportunities, Porsche could have positioned themselves for an instant sellout and notoriety in the NFT space. Tiffany & Co.’s NFT collaboration with Yuga Labs and blockchain software company Chain, allowed the luxury jewelers to maintain their integrity across both industries. Tiffany’s ‘NFTiff’ project became the third highest selling NFT collection from the Web2 space in 2022.
NFT artist Pandaone (@pandaone34), commented on Twitter: “@eth_porsche failure is a good reminder that if web2 giants want to succeed in web3, they must put their egos aside and heed the advice of those who have been working in the space for real. If not, what’s the purpose of getting advisors?”
While there will undoubtedly be more events that unfold in the coming weeks leading up to Porsche’s sell out and delivery, many industries curious about entering the Web3 space can view this NFT drop as a valuable lesson.
Without partnering with a Web3 brand with a proven track record, Porsche missed the mark in their debut launch. While the crypto community is always welcoming new brands into the space to encourage widespread adoption, this launch was seen as a classic “for-profit” product built by a Web2 brand who failed to utilize NFTs to their full potential.
With an ever evolving space, it can be hard to keep up with the latest trends and developments in blockchain. To ensure a successful NFT deployment from start to finish, Chain launched Chain NFTs to tackle common oversights for mainstream brands entering Web3. Forming an alliance with a well-known Web3 brand helped brands such as Tiffany & Co., sell out their exclusive pendants in minutes. Read more about how Chain’s NFT-as-a-Service facilitated this instant sell-out at www.chain.com/blog/nftiff-case-study.