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Why It’s Important for Brands to Build Communities through Decentralization


Decentralization and DAOs (Decentralized Autonomous Organizations) are emerging as the new norm in the world of branding. At Orchid, we have been observing the growing trend of decentralization and the popularity of DAOs as well. In this article, we will delve into why brands should consider these technologies to build communities and transform the way they obtain consent from their target audience.

1 – Understanding Decentralisation

Decentralization refers to the shift from traditional, centralized systems toward more distributed networks. This involves the decentralization of power, decision-making, and control over data and information. Decentralization has the potential to disrupt a variety of industries, including finance and marketing, by removing intermediaries and creating more direct and transparent relationships between individuals and organizations.

2 – The Concept of DAOs

DAOs are a new type of organization that operate on a blockchain and are driven by code instead of people. They are completely transparent, secure, and operate without intermediaries. Brands can leverage DAOs to revolutionize their engagement with their audiences and make decisions together, without the need for a central authority.

3 – Why Brands Should Consider Decentralisation and DAOs

Decentralization and DAOs offer brands a new way to obtain consent from a target audience and engage with them. By utilizing these technologies, brands can create more direct and transparent relationships with their target audience, making decisions together based on shared values and goals. This can help build stronger connections and increase brand loyalty, ultimately creating a sense of community.

4 – Using Decentralisation and DAOs in Marketing Activations

Brands can use decentralization and DAOs to create innovative marketing campaigns that involve their audience in the decision-making process. For example, brands can use a DAO to allow their audience to vote on the direction of a new product launch or marketing campaign. This not only gives the audience a voice, but it also helps build trust and credibility with the brand.

Moreover, decentralization and DAOs can create new marketing channels and revenue streams for brands. For instance, a brand could create a DAO-based loyalty program that rewards customers for their engagement and loyalty. This creates a new revenue stream while also strengthening the relationship between the brand and its audience.

“1000 Fan” theory

This theory states that a creator or brand only needs to have 1000 true fans to be successful. The theory emphasizes the importance of building a dedicated and passionate community of fans who will support and spread the word about the creator or brand. This is where blockchain technologies, such as DAOs, can play a crucial role in building communities. With DAOs, brands can directly engage with their audiences, involve them in decision-making, and reward them for their loyalty and engagement. This not only strengthens the bond between the brand and its audience, but it also ensures that the brand has a loyal community of 1000 fans who will spread the word and support the brand in the long-term. In the world of marketing, where building strong relationships with consumers is crucial, the “1000 Fans” theory, combined with the use of blockchain technologies, can be a game-changer for brands looking to establish a loyal following.

Quick Case Study: Nike's NFTs

In 2021, Nike made headlines with its innovative NFT (Non-Fungible Token) campaign, which marked the company’s entry into the world of blockchain. The campaign, which was called “CryptoKicks,” involved the creation of a limited-edition line of NFT sneakers. Each sneaker was unique and could be bought and sold on the blockchain, making it possible for fans to own a piece of the brand’s history.

Nike’s NFT campaign is a great example of how decentralization and blockchain technology can be used to build communities and engage audiences in new and exciting ways. By using NFTs, Nike was able to create a sense of exclusivity and collectability around its products, which helped to increase the brand appeal and community awareness.

Furthermore, the use of NFTs allowed Nike to obtain consent from its fans in a new and innovative way. By allowing fans to make decisions about how they want to use and sell their NFT sneakers, Nike created a new, more direct and transparent relationship with its fans — one that allowed fans to own a piece of the brand’s history. This helped to increase brand loyalty and credibility, while also building new revenue streams.

Nike’s NFT campaign is a great example of how brands can use decentralization and blockchain technology to engage their audiences and obtain active consent. By partnering with or acquiring organizations and actors of the space, Nike was able to understand and interact with culture directly, and even bridge the gap to convert their neophyte following to new mediums.

What do we think?

Here at Orchid, we are convinced that decentralization and DAOs have the potential to transform the way brands are developed. As the technology continues to evolve and mature, we expect to see more brands adopt these technologies into their marketing mix.

We also believe that decentralization and DAOs have the potential to create new, more democratic and transparent marketing channels for brands. By allowing brands to make decisions with their audiences instead of for them, decentralization and DAOs can help to create more trust and status between brands and their target audience.

In conclusion, as brands seek new ways to engage with their audiences, obtain consent and create value on brand and client side, they should consider the potential of decentralization and DAOs.

At Orchid, we are excited about the future of decentralization and DAOs. They open new fields of creativity and promote a culture of experimentation — one brands have the chance to dive into. Get in touch to discuss your ideas!

  • Technology
  • Blockchain
  • Web3
February 15, 2022
Orchid Creation
São Paulo