The Integration of Virtual and Physical: Is it the Future?
Legitimate, a leading company in the field of virtual and physical integration technology, has already launched over 20,000 products in the United States. It has successfully helped brand customers enter the world of Web3. Some of Legitimate’s notable partners include well-known sports brand Puma and international fashion brand Ambush. Legitimate can be considered a pioneer in combining physical goods with Web3 experiences.
However, compared to the hype of Web3 in the past 2-3 years, the current discussion surrounding it is noticeably lower. So why does Legitimate still believe that virtual and physical integration is the future? And what exactly is virtual and physical integration?
The key lies in the NFC chip called “LGT Tags” that Legitimate has introduced to connect physical goods with the Web3 world. Daniel Duan, the CTO of Legitimate, explains that LGT Tags can be provided to brand partners and integrated into physical products such as clothing and shoes. When consumers purchase these goods, they can scan the LGT Tags, link their wallets, and obtain NFT certificates corresponding to the physical products. They can then verify the authenticity of the products on Legitimate’s platform and view detailed information such as manufacturing dates and upload times.
In a 2023 case, Legitimate collaborated with Puma and the American music label Roc Nation to launch the “Evolution of the Mixtape” virtual and physical integration sneaker series, celebrating the 50th anniversary of hip-hop music. After scanning the LGT Tags on the tongue of the shoes, consumers could obtain NFTs and unlock exclusive songs and behind-the-scenes content provided by Roc Nation.
LGT Tags not only provide consumers with the function to verify authenticity, but also collect and analyze consumer data. For example, the location at the time of chip scanning can provide insights to brands about where their products are being sold. Additionally, brands can determine the popularity of their products through scanning frequency and interaction frequency, allowing them to develop more precise marketing strategies.
The interaction between brands and consumers is no longer limited to the traditional “buy one, get one” sales approach. Through Legitimate’s service, brands can continuously provide consumers with new content and offers through NFTs linked to physical products, creating a deeper level of interactive experience for both parties.
So why are big brands willing to adopt virtual and physical integration? Daniel analyzes that Legitimate can provide chips that adapt to various product materials and shapes, and has a professional team to help brands enter the world of Web3 through marketing methods and channels. Furthermore, LGT Tags can verify product authenticity and allow brands to deeply engage in the digital market, which is why traditional brands are willing to take the risk and try new technologies.
Events like the closure of cryptocurrency exchange FTX have affected the cryptocurrency industry in the past two years, particularly the trust of traditional industries in Web3. “However, after a year or two, many brands have started to accept and recognize the concept of Web3. Take Puma, for example. In the past, they may not have been willing to enter the Web3 field, but now they have their own Web3 department,” explains Daniel. As misunderstandings are cleared, brands have also started to observe the benefits that NFT technology can bring.
In addition to enhancing authenticity, NFTs also serve the purpose of anti-counterfeiting by acting as digital certificates, further strengthening the authenticity and value of products. It is worth noting that according to new regulations in the European Union, from 2026 to 2030, there will be a major push for “Digital Product Passports” to record information such as the origin of products and their production history. NFTs, with their unique and transparent characteristics, will play an important role in this, indicating that more and more brands will pay attention to them.
The biggest challenge Legitimate faces in promoting its products is that the technology is still relatively new for traditional industries. Not everyone is familiar with blockchain technology, and most people have not had any exposure or experience with similar products. “Therefore, even communication or explanation with the innovation department of a company can be difficult,” admits Daniel.
In such a situation, Legitimate focuses on conveying the value of blockchain technology to potential customers and provides necessary training and comprehensive planning to ensure that brands can understand and adapt to the new technology.
So what is the next step for the market of virtual and physical integration? Daniel offers his observations about the current state and future of virtual and physical integration in the retail industry.
In terms of regions, people in Asia, especially Japan, are very interested in fresh and different things. Therefore, creating interesting experiences in both physical and digital spaces is a key focus in the local market.
In the United States and Europe, people are more concerned about sustainability issues, especially the production process, materials used, and transportation methods of products. Additionally, while global consumers care about the authenticity of products, consumers in Europe and the United States tend to prefer mechanisms that allow them to verify products themselves, while in Asia, they rely more on professional verification organizations.
“Different regions have different focuses on the virtual and physical integration market, but they all care about the authenticity, sustainability, and digitization of products,” says Daniel.
In terms of retail application scenarios for virtual and physical integration technology, there are two main directions. Some stores like to bring augmented reality (AR) and virtual reality (VR) experiences into physical locations or shops. Others excel at setting up special thresholds, such as owning specific NFTs, as conditions for limited product repurchases or meetings.
Daniel is optimistic about the future development of virtual and physical integration technology. He points out that many brands have already added NFC and RFID tags to their products for scanning and verifying, but currently, these technologies are mostly used internally by brands and not accessible to consumers.
“However, blockchain unlocks different communication methods between brands and consumers. As more brands start using these technologies and applying them to more diverse products, the virtual and physical integration market will become more mature,” analyzes Daniel.
Proofread by: Gao Jingyuan
