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“This Is the First Time That NFTs Have Utility”
ANDRÉ JOHNSON, MYTHICAL GAMES “THIS IS THE FIRST TIME THAT NFTS HAVE UTILITY”
Brands like Gucci have experimented with their own games, Balenciaga just launched a collection on Fortnite, and now Burberry has taken the next step forward. For Mythical Games’ “Blankos Block Party”, the fashion label created a limited-edition character called Sharky B – and that character is an NFT. Could fashion find a whole new source of revenue here? We talked to André Johnson, VP of Business Development at Mythical Games, to find
out. Interview: Petrina Engelke. Photos: Mythical Games/André Johnson
Mythical Games VP of Business Development André Johnson, son of basketball legend Earvin “Magic” Johnson, has been working in the gaming industry for seven years, and in entertainment and sports before that. Looking at the way he treats his sneaker collection, you can tell his heart is in fashion, too. “Blankos Block Party” looks like a world modelled on the vinyl toy industry. How does that work as a game? “Blankos Block Party” is a vibrant world of vinyl toys come to life. When you first log in, you arrive in a social place called the Junction where you can chat with other players. So it is that place where players can meet and socialise before they enter a game. You can also look at the store, and you can go off on many missions, quests, and games. To me, it is exciting to be able to bring fashion, sports, entertainment, and intellectual property (IP) all together to push culture forward through a game. It is for players and collectors who come in and purchase designs they really love.
In-game sales already constitute a big chunk of revenue for the gaming industry, which is estimated to make 180 billion US Dollars worldwide in 2021. What is your special angle on sales in a digital space?
Our special angle is that each character, each accessory within the game is an NFT. That means after the purchase, the players actually own them. You can also play with those characters and accessories within the game. So it is the first time that NFTs have utility. Collectors can choose to either hold on to those assets or sell them in the secondary market via our Mythical Marketplace. When that happens, the designers, brands, or artists behind these items, the IP holders, receive revenue from those secondary market transactions. They are actually receiving revenue from their creations in perpetuity, and that opportunity does not yet exist right now. On eBay, Stock X, or Goat, designers do not receive any revenue from secondary market sales.
How has this promise of getting a share from resales worked out for Burberry?
We were excited to see how fast the value of these assets goes up. Burberry’s Sharky B character sold out in less than 30 seconds. And within minutes, those same 300 US Dollar characters were trading in our secondary market for upwards of 1,500 US Dollars.
Who set the original price of 300 US Dollars, and what is in it for Burberry or other fashion brands?
We collaborate on the sales price. In Burberry’s case, we gave recommendations based on the brand representing high-end fashion and selling items for a higher price point. We also looked at our player base and what they are accustomed to paying for premium level accessories and characters. Burberry and any other brand that we collaborate with will receive revenue on the primary sale. And then they receive revenue on every sale and transaction thereafter.
The design of the Sharky B character and its accessories are based on Burberry’s summer collection. But they do not offer a jetpack, as far as I know. Who came up with that?
If there is a Burberry jetpack out there somewhere, I am sure it is sold out already. These designs are a collaboration. Their team and our internal art department came up with the designs based on the new monogram design that Burberry was using for their summer collection. We took that and put it on the character and on a jetpack, translated it into swimming armbands and shark shoes.
Your job actually is not designing, it is finding the perfect brand for a collaboration. So how did that work? Did Burberry approach you, or did you specifically seek out luxury fashion?
In Burberry’s case, they approached us. But to your point, as the VP of Business Development, my job is to go out there and seek what kind of brand, or what kind of IP, would be a good fit within the game. And our next fashion collaboration will be with The Marathon Clothing, which was founded by the late Nipsey Hussle.
Burberry placed 750 Sharky B characters in “Blankos Block Party”. They cost 300 US Dollars and sold out in 30 seconds, according to Mythical Games. Since the character is an NFT, Burberry receives a share of any resale.
What makes a fashion brand a good fit for “Blankos Block Party”?
We try to target brands that are thinking culture forward, that are excited about technology, that are excited about the NFT space. For example, when they opened The Marathon Clothing store five years ago, Nipsey was already a forward thinker. He was involved in cryptocurrency and educating people on investing in the crypto space. But he also started the first smart store I can think of that was incorporating augmented reality technology. With their app, you can go into the Marathon Clothing store and scan a hang tag, and you will get additional content or music videos that will play on your phone or on a screen within the store. We look for such brands, who are already tech forward, moving culture forward. Maybe they have a strategy, maybe they do not – and maybe that is something we can help them with. But we try to pinpoint what brands are out there that fit that intersection of sports, entertainment, music, and fashion and push things forward that way.
Talking about the customer experience in a store points to something that I think fashion and games have in common: the thrill of the hunt. You want your trophy; you are competing with other people or against the clock. Then again, “Blankos Block Party” does not look very competitive to me. So what about the hunt component?
On the outside, looking in, it might not seem competitive. But within the levels, some games are a race against time. How many good vibes can you collect in the timeframe? It is kind of family-friendly, comic-book-style competitive. And players right now are all about customising their characters to match their personalities, and then showing off their collections. You could have Sharky B put on some Deadmou5 shoes. And even a lot of us here in the company did not manage to secure Sharky B. I was one of those unlucky people. I logged in early, but it went so fast.
Wait a minute, does being fast not run in your family? After all, your father is basketball legend Earvin “Magic” Johnson.
(laughs) You know, in sports: yes. But buying online? I do not know if it translates.
Do you think what people like to play indicates anything about how we will go about marketing in the future?
I think it gives brands an opportunity to tease designs, collaborations, or their thoughts in the future. If they want to see how the audience would respond, we can put it in “Blankos” and allow people to purchase it, comment on it, and also see what the value is from a market standpoint.
I want to come back to something that you mentioned earlier: collectors. Take sneakers, for example. They come in a box, and there are some collectors who never unpack them. They do not want to get a speck of dust on them, because they know it might affect their value. Is there something similar going on with the NFTs in your game?
First, let me say that I am a sneaker head, too. So I understand that thought process. I am just on the other side of the coin. Buy the shoes to wear them – but otherwise, do put them back in the box. That is what I do every time after I wear them. And I keep those sneakers clean. I am the official clean-everybody’s-sneakers person in the family. So: collectors’ behaviour and NTFs. I think this is the first time collectors have a reason to purchase more than one character in a game. We have seen people come in and buy four or six of the same “Blankos”. And in some cases, players will use only one of those and keep the other ones on their shelf to see how they are trading in the marketplace. Also, if you decide that it is not worth your time to play anymore, you can still make good on your investment from those NFTs that you have acquired in the game by selling them in the secondary market.
Is that new or is that something that has been going on in gaming before?
It is something that has been going on, but we did the leg work on the front end to make it legal for trading to happen on the blockchain. Previously, this has been done in grey markets, which is not legal. And so we said: We like to collect, we like to play games, but nobody wants to go to prison for it.
In the art world, we have seen that NFTs raise many similar questions, also about storage or access in perpetuity. Is that uncertainty part of the game, so to speak?
If people are new to the blockchain space: yes. But because all our NFTs are minted on the chain, you see the serial number, how it is minted, all the information is there on the ledger. There really is no uncertainty of you owning the asset. It has been great to make artists and brands feel more comfortable that no one is fraudulently reselling things that are not the real Sharky B or Deadmou5 character.
Do you plan to make connections to the real world further down the line, for instance with apparel from the game being offered as clothes for humans?
Yes, we are definitely exploring the opportunity to merge the physical and the digital world, if you will. And hopefully in the new year, we will be able to test some of these experiments.
Meanwhile, catwalks and window shopping almost seem like a relic of the past. What do you think will drive demand in the future? How will people know what is hot?
I think it will be through innovation and a continued push-and-pull from a digital and a physical perspective. Brands doing things from a digital perspective to get in front of the gaming audience, and the gaming audience gaining more exposure to those brands and their plans. I think that brands will continue to push the envelope and offer limited-edition digital items, as well as limited-edition physical items. And then maybe do a physical run of the digital characters or digital apparel that you put in a game. I can definitely see “Blankos” characters expanding onto apparel, or even an animated TV series based on the characters.
What can the fashion industry learn from the entertainment industry, where you spent a good part of your career?
From a fashion standpoint, going with the wave of innovation through NFTs and gaming only enhances people’s affinity for those brands. So I think we will continue to innovate together, similar to how entertainment has embraced all the new streaming platforms. Netflix, Hulu, Peacock, Amazon Prime Video – people really embrace that. And we are hoping that the fashion industry looks at what we are doing as another outlet for creators.
