Some of the more well-known use cases for NFTs are image-for-evidence projects such as the Bored Ape Yacht Club and game projects to win. NFTs have also caught the attention of the sports industry, with professional sports leagues creating their own platforms for fans to interact with their favorite teams or players, but that will be discussed later in this story.
NFTs are unique, non-interchangeable pieces of code stored on the blockchain. These alphanumeric code strings can be linked to assets such as works of art or digital and physical goods. NFTs are created through a process known as minting, and creators can set a limit on the number of NFTs they wish to mint, creating scarcity.
Scarcity is a phenomenon that has always applied to physical assets due to their physical construction with limited resources. However, scarcity has never existed with digital goods because they can be easily replicated. NFTs have changed that, and we are now seeing a growth in the collectibles market in the digital world.
How are NFTs used for fan engagement?
When it comes to sports, fans are so attached to their favorite player or teams that they interact with them in every way possible. Engagement ranges from watching or attending live games, purchasing merchandise, or attending signature events. Fans want to be closer to their favorite teams and players, which provides opportunities for sports teams and leagues to generate additional revenue.
Sports leagues, in particular, have noticed the value of fan engagement and have created platforms where fans can buy, own, and trade digital memorabilia. A well-known example is the National Basketball League’s NBA Top Shots NFT marketplace, where fans can buy, sell, and trade basketball video clips. The music videos on the platform are known as NBA Top Shot Moments, and each shows a different highlight from a basketball game. The market was launched in 2020 as a joint venture between the NBA and Dapper Labs, the creators of CryptoKitties. It generated more than $230 million in sales less than a year after its launch.
Some music videos are sold in packs, similar to physical trading cards like Pokémon and Yu-Gi-Oh. There is also an element of gamification with different levels of rarity, ranging from “common” to “legendary”, a standard system in role-playing games. Rarer music videos are more likely to fetch a higher price than more common clips, increasing their perceived value as a collectible.
The NBA isn’t alone in offering sports leagues the opportunity to create their own engagement platforms. The National Football League and National Hockey League are working on their own NFT platforms, while Major League Baseball has already released its NFT market.
It’s not just sports leagues that have built fan engagement platforms — the concept is proving popular with non-sports league organizations coming into the space. For example, Fanzee is an upcoming platform that raised $2 million to create a marketplace and ecosystem where sports fans can complete challenges such as quizzes and games to increase their fan level and trade NFT collectibles.
Similar to NBA Top Shots, there is an element of gamification. In this case, sports clubs can create interactive challenges such as quizzes based on previous matches to test how closely fans followed the game. Additionally, fans can earn experience points and NFTs based on their interaction with the game. Experience points increase their “fan level”, which is displayed on a leaderboard, with fans earning prizes by according to their rank.
“Gamification is a great way to drive engagement. Having a fun and exciting platform experience helps draw people in. There has to be a story, even if it’s a lighthearted story like GoblinTown. Max Luck, responsible for growing the ecosystem at the interoperability-focused Flare Network, told Cointelegraph, adding:
“NFTs are quite unique in the way they help keep communities active and engaged – or ‘sticky,’ especially with secondary markets popping up in different ecosystems and the potential for NFTs to be used across various gaming metaverses. Also, a major opportunity for memes.
How are fan engagement platforms changing the sports industry?
Fan engagement platforms are bringing real-world industries like collectibles into the Web3 space. Non-fungible tokens are a great way to appeal to younger, more savvy users by adding modern ways for fans to interact with their favorite teams and players while creating additional revenue streams for sports leagues.
Luck agrees that NFTs are a great way to engage young fans with their favorite teams and players, “NFTs are kind of like marketing tools that have the power to bring newcomers into the game. This is especially true among young fans who have collectibles on their phones and can share their excitement and experiences with friends at school or college.
“Nowadays, technology can drive discovery, where previous generations might have watched sports with their families at home or in the stadium and built their support there,” Luck continued, “The success of attracting newcomers would depend on how simple and simple the platforms are for them to get their hands on their first NFTs with an accessible UI/UX – and how prohibitively expensive it is.
Digital assets could have a significant effect on how close sports fans are to their favorite teams if used correctly. It will be easier for fans to follow the teams and athletes they care about the most. For this reason, sports organizations have the opportunity to use digital assets to their advantage. It will come as no surprise that most sports leagues will have their own NFT platforms where fans could interact with blockchain-based assets within the next few years.
However, the focus should be on fan engagement instead of trying to make a quick buck just by selling tokens. By focusing on fan engagement, these platforms may see increased adoption since fans will be more likely to introduce new users to the platforms. It will also improve user retention as fans will use these platforms for personal enjoyment instead of trying to make money by flipping tokens or digital assets they have purchased. If the bear market has taught us anything, speculative users always disappear when the market stops rising.
Félix Le Breton, head of digital revenue at French esports organization Team Vitality, told Cointelegraph: “NFTs can be a good way to attract young fans, as long as you stay away from it. speculative aspect. Obviously, the younger generation is familiar with the principle of digital property and it is easy for them to get started.
Platforms that take a user-centric approach focusing on high engagement and user retention will see the most success with fan engagement platforms, in addition to improving the educating users on how NFTs will also help bring the sports industry into the Web3 space. On average, 76% of sports fans worldwide are open to learn more about NFTstherefore, there is a great opportunity for organizations in the sports industry to introduce blockchain-based assets to their consumers.
NFTs can change the sports world by bringing offline activities to the online world. In the past, fans collected trading cards, nominated T-shirts and footballs, and exchanged printed photos of their favorite players. As the world becomes increasingly digital, young fans will find new ways to engage with their favorite teams and players using blockchain technology.