Market analysis

IoT & blockchain

First of all, let's look at the Internet of Things, which, together with blockchain, is probably the most logical market for innovation in advertising. In addition, the two markets hedge against each other. And here's why: "Because of the wide variety of devices, IoT advertisers now need to conceptualize and design their campaigns for heterogeneous purposes, that is, to use newer advertising formats that are not necessarily visual (such as audio messages), as opposed to traditional banners displayed in web browsers or mobile apps. That said, the IoT market is evolving just as much as the blockchain market:

This includes a capitalisation breakdown:

This leads to three conclusions:

1. The market in terms of the number of actors in advertising that appear to be (semi-)autonomous devices, scripts, neural networks and yet are controlled via open networks (blockchain, DAG) will increase - until 2030 at least;

2. For the end-user-subject, differentiating it from different kinds of "positive" and "negative" bots, devices and other entities will be crucial: this is currently seen in the example of Play-to-Earn games;

3. Finally, it is the "blockchain + IoT" nexus that provides the opportunity, through open source protocols, for actors not connected to each other outside of specific ecosystems to interact.

Until recently, there were a number of problems in this area that could not be solved comprehensively: in particular, the difficulties associated with the tokenization of unique entities of the offline world, including and primarily people, who are difficult to identify in systems built on the principles of anonymity, openness, decentralization at the same time. But with the second wave of hype around NFTs, including through the Game Finance marketplace, such obstacles have largely been removed.

GameFi, NFTs and advertising

To appreciate the innovations described, let's try to briefly highlight those segments that have become directly dependent on bundling with non-interchangeable tokens:

Ad hoc advertising, or temporary promotions:

1. From companies - including giants like McDonald's, Coca-Cola, Bacardi, The Bell, Microsoft, Nike, etc., that have provided interaction with goods and services through the purchase, collectible NFT in one-off promotions. Including this approach works both within game mechanics, free worlds (meta universes);

2. From Influencers: Beeple, Banksy, J. Dorsey, M. Cuban, etc. introduced a new format of uniqueness to the world. In fact - any creation tokenised through NFT became available both as an offline work itself and as its virtual (or rather XR) avatar. Further, this technology was adopted for mass promotions.

Site advertising:

1. Protometavels & GameFi: Decentraland, CryptoVoxels, Sandbox and others provide a fairly narrow range of services to date: including banner advertising on a particular piece of virtual 'land' or click-through links. In some cases, NFTs can uniquely identify content, but no more;

2. Marketplaces: OpenSea, Rarible, Nifty, etc. enable standard advertising or advertising, for example via metadata embedded in NFTs, but there is no integration of these tools.

NFT projects with an advertising bias, such as:

1. Rarity tools - a digital rarity evaluation startup that helps evaluate possible investments, including - when using NFTs to attract attention;

2. X10 Agency - a service that helps combine the classic tools of advertising and NFT, but in a fairly narrow range;

3. Koala Intelligence Agency - the brightest example of implementation of classic banner advertising through NFT-marketplaces.

Others.

In other words, there are currently very few projects that specifically deal with advertising campaigns within Metavsels, GameFi-projects, and even less so in DAO integrations. Here's what a gradation of such services might look like roughly:

1. Creation (creative):

   1. NFT avatars:

      1. https://boredapeyachtclub.com

      2. https://www.larvalabs.com/cryptopunks

   2. Customisable content: https://www.artblocks.io/learn

2. Platforms (aggregators):

   1. Future NFT advertising: https://rarity.tools

   2. General purpose agencies with specialisation for Web 3.0:

      1. https://x10.agency/nft

      2. https://www.eskimi.com/dsp

   3. Influencer platforms: https://metafluence.com

   4. Investment integration systems: https://www.republicrealm.com

3. Private individuals integrating advertising:

   1. Through freelance marketplaces;

   2. Through custom orders;

4. Others.

Despite the incompleteness of the classification, the conclusions are obvious and they are as follows:

1. New advertising patterns, such as those born from the unique capabilities of IoT & blockchain, GameFi + NFTs and others are in their infancy;

2. Open systems data analytics is complicated by their architecture and requires innovation: as of today, solutions developed for, say, Decentraland are highly unlikely to work in Sandbox and vice versa;

3. In fact we have a transitional phase, when large international corporations use innovative tools as a label "we did it", though in essence the described processes are a transposition of the advertising methods of past years to NFT-format or even to standard tools within new spaces; in their turn the newly born start-ups cover niches, but not the market in general.

Therefore, it would be right to focus on much more global trends and explain how Veezy is trying to integrate them.

Innovative trends

Research into innovation in advertising is plentiful. Here's what Forbes stipulates: Tangibility through XR. Expanding interactions. "In theory, the meta-universe will consist of multiple interacting virtual worlds that allow people to easily teleport from one experience to another and facilitate everything from social interaction to entertainment, shopping and work. Luxury brands started creating clothing with avatars back in 2018, and brands have been collaborating with games for several years." Thus, the trend of interoperability, which is inherent in all Web 3.0 phenomena, is clearly highlighted here.

The main trend within this vector: moving from ad hoc innovation - to an ongoing strategy. Something similar was the case with internet marketing: at first companies tried it in Test-and-Learn mode, then, having evaluated its effectiveness, they increased the share in the total advertising budget just for internet spending, and today this method is the most in-demand. "The customer of tomorrow is in the virtual realm. If you remember Web 1.0, Web 2.0, at one point the Internet was experimental. Then it became the place where some brands succeeded, then it became the place where you have to be, and now it is the main form of communication for most brands. We are going through the same process. In the first iteration of the Internet, that process took 10 years." Now the timeframe can be much shorter: 12 to 18 months.

This is also evidenced by the Google.Trends graph for the "Metaverse" query:

That is, it is not just the traded fund with the META ticker (see details), but it is the consumer query that verifies this vector. Why? The reasons, again, are several:

• First, brands have to redefine their narratives in three dimensions at once, and precisely for the reason voiced above: in the Meta universe, everyone is a world-builder, i.e. the difference is minimal not only between the subject-object, but also between the consumer and the business.

• Secondly, according to various estimates in 2021, around 85 million users have used AR or VR at least once a month. And businesses are already leveraging this. A prime example is Google Maps: the service has demonstrated the AR feature of its walking routes, which offers precise visual instructions and arrows that make it easier to find your way to your destination. The user simply has to point the camera in the direction where they want the directions, and the AR feature will point them in the right direction. Advertising platforms of the near future must therefore be able to handle different spaces: real reality, but tokenised (RR); VR, AR, MR and other spaces that all together represent a confused reality - XR. To make it easier to understand, we apply the formula: RR + VR + AR + MR + OR = XR.

• Thirdly, it is not only the approach to advertising integrations, the space itself, but also the understanding of the essence of economic and other incentives that changes. Example: "sponsorship of in-game items offers not only a way to market the brand, but also a potentially lucrative new revenue stream... The World Wide Web Consortium (W3C) Open Metaverse Interoperability Group (OMI) is focused on connecting virtual worlds by developing and promoting protocols for identity, social graphs, inventory and more." Overall, the NFTs rental market is one of the youngest, most in-demand and promising.