The Evolution of Digital Assets: The Significance of 3D + AR for Fashion Brands and NFTs
The continuous development of 3D and AR technologies have some important consequences for the entire NFT ecosystem. I decided to dig a bit deeper into the 3D + AR ecosystems. Here was what I found:
3D + AR = Increasing Demand + Better Conversion
The effect of AR + 3D technology has a profound effect on customer demand in the fashion sector. The first trend is growing number of AR users, expected to grow to 110 million in the US alone in 2023 (see below).
While this is a great signal for the tech utilization, what’s more impressive is AR’s effect on customer demand and conversion. Data points such as an increase in conversion rate by 97% and the reduction in returns by 40% when 3D + AR is used (Shopify Research), mean that the tech will undoubtedly maintain a strong demand in the future. The 3D + AR combination is especially fitting for luxury brands (increase their conversion rate by 40%).
While the statistics vary, they all point to 3D being an improved alternative to 2D content. As 3D artist talent grows, brands will gravitate toward 3D and AR technology. The NFT boom has played a strong part in expediting the development of 3D talent and agencies such as PlatformE that provide a suite of 3D services.
A Social Experience
While 3D + AR create an improved customer online shopping experience (e.g. via virtual try-ons) and offers attractive marketing assets, the biggest potential lies with the social aspect that 3D + AR unlocks. For instance, the improvement of virtual try-on technology will enable customers to share their potential outfits with friends and on social media platforms like Snap and TikTok. These already incorporate AR technology in a substantive way. Especially Snap is working hard to become the AR hub for all brands and creators. They let brands use their AR technology and design tools, namely Lens Studio, for the creation of custom assets.
This technology enables 3D try-ons (via Snap’s new “Dress Up” section), distribution on Snap’s AR, brand’s own platform and even TikTok. To make things even more streamlined, customers can buy these clothes directly via the Snap app. Snap makes it even simpler by connecting AR lens creators with brands via their creator marketplace.
Significantly, Snap’s AR tools offer brands the ability to translate existing product photos into try-on assets that can be overlaid onto user-submitted, static selfies (see above). Snap’s Lens Studio also allows the integration of third-party 2D or 3D software and even plugging own machine learning models to create smart lenses. However, it is to be noted that the Snap lenses themselves cannot be monetized. Instead, they act as an increasingly important marketing channel. In sum, Snap’s AR capabilities are moving the entire space forward as brands now have the ability to experiment with AR due to the low barrier to entry.
The AR space is constantly coming out with improvements and innovations. What exactly are these?
Innovation (Snap)
Some of the innovations at Snap revolve around:
Spatial technology — anchoring digital to physical à Snap Spectacles evolving (including play and build capabilities)
More realistic AR clothing rendering including natural flow. “Ray tracing” technology includes more “lifelike reflections, shadows and lighting on digital products, which works in real time across mobile devices.”
Improved voice recognition
3D asset content management system (acquisition of Vertebrae)
All-around improvement in software and hardware making more compelling AR clothing videos
Innovation (Other brands)
Amazon is getting into AR shopping with virtual try-on for shoes
StockX is testing the ability to try on clothing in real-time via their app.
Improvement in cameras (Lidar) + markerless body tracking + body segmentation and pose estimation
Source: Amazon
Improved Design Process & Infrastructure
In addition to being a compelling marketing and conversion tool, 3D technology streamlines the fashion design process. First, 3D technology speeds up the design process and enables a level of co-creation previously unavailable to designers. Imagine brands collaborating in real-time with not only each other but also manufacturing partners (getting rid of the resource-intensive process of sending samples back and forth). Companies like PlatformE can create 3D renders of products on demand. Second, 3D design introduces new design paradigms, including 3D fabric printing (see Iris Van Herpen’s designs). According to Institute of Digital Fashion data, the majority of metaverse participants preferred surreal over realistic digital clothing. As the physical meets digital the two will meet both the digital and physical realms.
3D + AR + NFTs
So where do NFTs fit into all of this? We’ve covered the use-cases of fashion NFTs in-depth in our article HERE, however, the fundamental benefits of NFTs in the 3D/AR context are: 1) 3D assets function well as NFTs, while AR is great for marketing 2) co-creation possibilities 3) the collectability aspect.
AR is great for marketing, 3D assets function well as NFTs. One of the biggest NFT brands, RTFKT, had a successful 3D/AR hybrid campaign around their Cybersneaker NFT: they marketed the 3D shoe NFT via Snap AR filters (remember the Elon Musk Cybersneaker red carpet moment). On the other hand, Parallel (an NFT-based sci-fi card game) is creating AR assets of its playing cards to augment the playable universe. Overall, NFTs allow studios and smaller creators to monetize their skills without having to raise money from outside investors.
The RTFKT Cybersneaker AR marketing campaign Co-creation is another one of NFTs’ strengths. The community can co-create 3D assets with the brand (e.g. RTFKT Space Drip in the pic below).
One of the RTFKT Space Drip Community-Created sneakers As 3D rendering skills grow, and because NFTs align the brand and financial incentives of the brand with the community, there will be an abundance of community-created 3D assets (aka modern marketing materials). There have even been cases where the brand even shares sales royalties with member-designed 3D assets. Moreover, the token-gated nature of these NFT communities creates a structure and a sense of belonging that can encourage remixing and expanding the brand’s original intellectual property.
It simply makes sense for digital assets (especially collectibles) to be NFTs. Just like you wouldn’t want a physical Nike shoe that you can only access via the Nike Store, you wouldn’t want your digital assets to be controlled by someone else. If digital assets are, indeed, a new asset class then ownership must be secured and provenance demonstrated.
Conclusion
It’s often easier to comprehend concepts visually. Here’s a flow chart that summarizes the 3D + AR + NFT landscape and then some. Not an easy one to read, but nevertheless a good summary.
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