Since CryptoKitties came out in 2017, nonfungible tokens (NFTs) have become very popular. Over the next two years, the industry is expected to make over $800 billion.
NFTs are often used for picture-for-proof projects like the Bored Ape Yacht Club and play-to-earn gaming projects. The sports industry has also taken notice of NFTs. Major sports leagues have set up their platforms for fans to interact with their favorite teams or players, but that will be covered later in this article.
NFTs are pieces of code that can’t be swapped or changed and are kept on the blockchain. These strings of letters and numbers can be linked to things like works of art or digital and physical goods. Minting is the process of making NFTs, and producers can limit the number of NFTs they want to make. This creates a scarcity of NFTs.
Physical assets have always been scarce because they can only be made with a limited number of resources. But digital products have never been scarce because they are so easy to copy. This has changed because of NFTs, and the market for digital collectibles is growing right now.
What role does NFTs have in fan engagement?
When it comes to sports, fans do everything they can to connect with their favorite player or team. Watching or going to live games, buying things, or going to signing ceremonies are all ways to get involved. Fans want to be closer to their favorite teams and players, which gives sports clubs and organizations a chance to make more money.
Especially, sports leagues have realized how important it is for fans to be involved and have set up ways for fans to buy, own, and trade digital mementos. One well-known example is the NBA Top Shots NFT marketplace, where basketball fans can buy, sell, and trade basketball video clips. There are video clips on the site called NBA Top Shot moments. Each one shows a different exciting moment from a basketball game. In 2020, the NBA and Dapper Labs, the company that made CryptoKitties, started a business together. In its first year on the market, it made more than $230 million in sales.
Some video clips are sold in packs, like traditional trading cards like Pokémon or Yu-Gi-Oh. There is also a gaming element since the rarity levels range from “common” to “legendary,” which is a common way to do things in role-playing games. Rare video clips are more likely to sell for a higher price than common ones, which makes them seem more valuable as collectibles.
The NBA is not the only sports league to build its way for fans to talk to each other. The National Football League and the National Hockey League are working on their own NFT systems, but Major League Baseball has already opened its NFT marketplace.
Not only do sports leagues have ways for fans to interact with them, but so do groups that aren’t sports leagues. For example, Fanzee is a new platform that raised $2 million to build a marketplace and ecosystem where sports fans can do things like quizzes and games to increase their fan level and trade NFT items.
There is a game-like element, like in NBA Top Shots. In this case, sports teams could make interactive challenges, like quizzes about past games, to see how closely fans have been watching the sport. Fans can also win experience points and other non-monetary prizes by taking part in the game. A fan’s “fan level,” which is shown on a scoreboard, goes up as they earn experience points, and rewards are given based on where the fan is.
“Gamification is a great way to drive engagement. Having a fun and exciting platform experience helps draw people in. There’s got to be a story though, even if it’s a lighthearted one like GoblinTown.” Max Luck, is in charge of ecosystem development at Flare Network, which is focused on interoperability.
“NFTs are pretty unique in how they help to keep communities active and engaged — or ‘sticky,’ especially with secondary marketplaces springing up across different ecosystems and the potential for NFT use in various gaming metaverses. Also, a major opportunity for memes.”
Fan interaction platforms are bringing real-world businesses like collectibles into the Web3 world. Non-fungible tokens are a great way to get younger and more tech-savvy people interested in sports by giving fans new ways to connect with their favorite teams and players and giving sports organizations more ways to make money.
Luck agrees that NFTs are a great way for young fans to connect with their favorite teams and players “NFTs are kinda like marketing tools that carry the power to bring newcomers to the game. This is especially true among younger fans who have collectibles on their phones and can share their enthusiasm and experiences with friends at school or college.”
“Nowadays, tech can drive discovery, whereas previous generations might have watched sports with their families at home or in the stadium and developed their support there,” Luck continued, “The success of attracting newcomers would depend on how simple and easy platforms can make it for them to get hold of their first NFTs with accessible UI/UX — and how prohibitive the costs are.”
Using digital assets in the right way could make a big difference in how fans feel about their favorite teams. It will be easier for fans to keep up with the teams and athletes they care about the most. Because of this, sports organizations can use digital assets to their advantage. It wouldn’t be surprising if, in the next few years, most sports leagues set up their NFT platforms where fans can play with blockchain-based assets.
But the focus should be on getting fans to take part, not on trying to make quick money by selling tokens. By focusing on fan interaction, these platforms may get more people to use them since fans will be more likely to tell their friends about them. This will also make it easier for fans to stay on these platforms since they won’t be trying to make money by flipping tokens or digital assets. If there’s one thing the bear market taught us, it’s that speculators always leave the market when it stops going up.
The digital revenue manager for the French esports team Team Vitality, Félix Le Breton, told Cointelegraph, “NFTs could be a great way to attract new followers, as long as the speculation part is left out. Younger people are used to the idea of digital ownership, so it’s easy for them to get on board with it.”
Fan engagement solutions that put the user first and focus on high engagement and keeping users will do the best. Also, teaching people about NFTs will help bring the sports business to the Web3 area. There is a lot of potential for businesses in the sports industry to offer blockchain-based assets to their customers since 76% of passionate sports fans around the world want to learn more about NFTs.
NFTs could change the sports industry by putting things that used to be done offline online. Fans used to collect trading cards, T-shirts, and footballs signed by their favorite athletes, and trade printed photos of those athletes. As the world gets more digital, younger fans will be able to interact with their favorite teams and players in new ways thanks to blockchain technology.