Despite FTX And The Crypto Winter NFTs Are The Future Of Fan Engagement

Forget the “crypto winter” and the collapse of FTX, blockchain technology still is the future of consumer relationship management (CRM) and holds the key to unlcoking amplified consumer/fan engagement in the sports world. Many of the leading consulting firms including AccentureACN
, Deloitte, PwC, KPMG and McKinsey & Company have published research reports expressing positive views on the potential for blockchain technology and NFTs to transform the way the sports teams and leagues promote fan loyalty.

The reason, according to their research is they that blockchain technology provides valuable tools for both the issuer of the token (NFT) as well as the recipient. For the issuer, it improves the quality of the data on their fans. For the recipient (the fan) blockchain technology, through NFTs, provides those fans with unprecedented benefits they can actually own, trade or sell in a controlled marketplace.

And it is coming faster than you think. The primary barrier to mass adoption was the necessity to create a crypto wallet such as Metamask which required some knowledge of crypto currency. As a result, adoption was limited to a rabid yet niche community. However, recent advances in technology have made the adoption friction-less and makes issuing and collecting these NFT simple for anyone even those without any knowledge of crypto currency or how to set up a traditional “wallet”.

Think of an NFT simply as a receptacle or the connective tissue for anything a fan values, whether that be digital goods or access (collectibles and admission to special places in the Metaverse) or things in the real world such as tickets, merchandise, food and beverage, experiences and even voting rights. The beauty of issuing these assets in the form of an NFT is that they are registered on the blockchain and can be used, traded or sold by fans in a marketplace created by the issuer.

For the issuer, the “wallet” provides a treasure trove of data that helps them better understand the fan and they learn from the “wallet” their fans behavior patterns which allows the issuer to understand them better and provide incentives for engaging in desired conduct.

It has its origins in the collectible space fueled by the breakout success of Dapper Labs NBA Top Shots. Dapper and the NFL have partnered on a similar project called NFL “All Day” that allow fans watching a game to own collectable moments.

FIFA has also entered the space by partnering with the blockchain AlgorandALGO
to launch their FIFA+Collect program which allows fans to own digital collectibles featuring iconic moments from the FIFA World Cup and FIFA Women’s World Cup, claiming to reach 3 to 5 Billion people.

However, the collapse of the digital collectable market has caused many these stakeholders to pull back. The creators of NBA Top Shots, Dapper Labs, just laid off 22% of its workers as the collectible market cratered and Candy Digital, a division of fanatics, did the same with 1/3 of its employees

Notwithstanding all this, the market opportunity is ripe for growth as attention turns from NFTs as simply collectibles to NFTs representing the fan’s right to “own” the things most engaging and valuable to them often sometimes through dynamic gamified experiences. NFTs will unlock for the first time the fan’s right to own, trade or sell these assets in a controlled marketplace and will be used to track and reward fans for attending games or events, purchasing merchandise, or participating in social media campaigns and could even give them voting rights on team related decision (solely at the discretion of the team, of course) This will create a more immersive and interactive experience for fans, and help the team better understand and engage with their audience. All of this is coming and it is just a matter of how quickly.