Despite FTX and Crypto Winter NFT is the future of fan engagement

Forget the “crypto winter” and the collapse of FTX, blockchain technology is still the future of consumer relationship management (CRM) and holds the key to unlocking enhanced 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 sports teams and leagues foster fan loyalty.

The reason, according to their research, is 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, gives those fans unprecedented benefits they can actually own, trade or sell on a controlled marketplace.

And it’s coming sooner than you think. The primary barrier to mass adoption was the necessity to create a crypto wallet like Metamask which required some knowledge of cryptocurrency. As a result, adoption was limited to a rabid, yet niche community. However, recent advances in technology have made adoption frictionless and make issuing and collecting these NFTs easy for anyone, even those with no knowledge of cryptocurrency or how to set up a traditional “wallet”.

Think of an NFT simply as the container or connective tissue for everything a fan values, whether it’s digital goods or access (collectibles and access to special places in the Metaverse) or real-world things like tickets, merchandise, food and drink, experiences and even the right to vote. 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 on a marketplace created by the issuer.

For the issuer, the “wallet” provides a treasure trove of data that helps them better understand their fans, and they learn from the “wallet” the fans’ behavioral patterns that allow the issuer to better understand them and provide incentives to engage in the desired behavior.

It originated in the collection space fueled by the breakout success of Dapper Labs NBA Top Shots. Dapper and the NFL have teamed up on a similar project called NFL “All Day” that allows fans watching a game to own collectible moments.

FIFA has also entered the space by partnering with the Algorand blockchainALGO
to launch its FIFA+Collect program which allows fans to own digital collectibles of iconic moments from the FIFA World Cup and FIFA Women’s World Cup, which claims to reach 3 to 5 billion people.

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

Despite all this, the market opportunity is ripe for growth as attention shifts from NFTs as mere collectibles to NFTs representing fans’ right to “own” the things most engaging and valuable to them, often sometimes through dynamic gamified -experiences. NFTs will for the first time unlock fans’ right to own, trade or sell these assets on 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 can even give them a vote on team-related decisions (at the team’s discretion, of course) This will create a more immersive and interactive experience for fans, helping the team better understand and engage with the audience. All of this is coming, and it’s just a matter of how quickly.