If psychology has taught us anything it is that behavioral economics are a part of everyday choices and as an entrepreneur, these subjects should be understood as a basis for selling products, services, and ideas. Psychology Today defines behavioral economic theories as “used to explain most everyday decisions, such as what people buy, how they manage their finances, and whether or not they make healthy lifestyle choices.”
You might be wondering why this stuff matters with GameStop, but I’m here to tell you NFT’s are all about the flex of ownership.
According to Psychology Today, “A key prediction of behavioral economics is that ownership of something increases its value in the owner’s eyes.” In other words, if you buy something you inherently apply more value to it because YOU bought it. Applying behavioral economics makes sense considering that NFTs are fundamentally worthless. That is, until someone decides to spend their life savings on a jpeg that they can right click and save as to “own”. It sounds crazy until you examine the value of ownership placed on the housing market in Austin, Texas.
The more people that find value in a thing the more valuable it becomes. This move then should come as no surprise when, according to the Wall Street Journal, the marketplace, OpenSea, has raised $300 million in venture capital and is now valued at $13.3 billion. GameStop intends to open its virtual doors as an NFT marketplace later this year. According to the Wall Street Journal, the gaming industry is expected to be among the first to infuse blockchain technology in order to incorporate cryptocurrency and NFTs. This idea is likely due to the fact that a handful of publicly-traded video game companies have launched or announced plans to sell NFTs. So, it’s not without merit, but what exactly would they be selling? Some are talking about virtual real estate as well as videogame collectibles. Having character-specific items such as a specific outfit or weapons are other ideas floating around. In today’s world where subscriptions rule, NFTs only help make uniqueness more effortless.
As an entrepreneur, it’s your job to understand the value you pass on to your clients. Not all of us will have the publicity that comes with the attempted populist movement that GameStop experienced, but we can all learn from their choice to reevaluate where they are headed in the future.
No one plans for the downfall of their company, but that’s a key takeaway here. In a worst-case scenario, how can your business veer in a new direction? The answers aren’t always crystal clear when imagining the future, but it’s always a good idea to consider options for other ways to persevere. What will you do if your supply chain is interrupted, customers stop coming in the door, or [insert disaster here]?