Four reasons sports teams shouldn’t rush into NFT’s
NFTs (Non-fungible tokens). Collins Dictionary’s word of the year for 2021, featured in the famous Spotify wrapped campaign, they have been everywhere recently. I have bought a handful myself…
Their application in sports specifically has also been prevalent. Liverpool have just closed their NFT launch, World Rugby has launched a Request for Information (RFI) process for interested parties to join its Digital Collectables journey and a lot of the North American sports teams across the NBA and NFL are well versed in this space.
So, given all of this, should more sports teams be investing in an NFT project? Make sure you’ve addressed these four points before you do…
Focus on the fundamentals of fan engagement first
Sports teams’ fan technology is behind the curve. When it comes to their digital strategy, what are the fundamentals every sports team should be thinking about?
Brilliant experiences for buying tickets, memberships, hospitality and e-commerce (e.g. Merch)
Producing great content and making ALL of this easy to engage with through inbound and outbound channels.
Point Of Sale (POS) solutions to make it easy to transact at the ground.
But bringing this together is not easy and many teams are falling into the same traps:
They have multiple tools which don’t speak to each other and it is a nightmare to manage… taking up hours and hours of staff time.
Their fan data is a mess (or non-existent) which eliminates upselling and cross selling opportunities as well as the ability to identify and thank highly engaged fans. We also saw how this can impact sponsorship opportunities with the Barcelona & Spotify example.
Unfortunately, this causes multiple issues for the fans of these teams:
Fans are navigating across multiple websites requiring different logins.
These sites are rarely mobile optimised and provide inconsistent, poor experiences to fans.
It feels transactional and disconnected. Fans don't feel like the club knows who they are (because they don’t).
With the right strategy, the fan experience can be a really positive one, so when it comes to investing in your technology - focus on these fundamentals.
Maximise the utility of NFT’s
There seem to be two types of NFT projects. The first is where an NFT is similar to a piece of art without utility and the second is where it behaves like a membership with utility.
I believe this second option has far more potential when using NFTs to drive fan engagement in sport. But the question is, what should this utility be? It could be anything, from early access to tickets to exclusive content and in-person club events. Once this is figured out, an even harder question arises, how can this utility be honoured? What does it look like in practical terms for fans to claim their membership benefits using their NFT?
I don’t think this process can be rushed. The benefits an NFT can provide and the customer journey for claiming them will be the difference between success and failure. I would be tempted to watch the wider NFT space for a bit longer and see which projects get the utility right before jumping in.
Know your fanbase and their knowledge of NFTs and Crypto
Anyone who has bought an NFT knows that the customer experience is not intuitive. Setting up a crypto wallet, buying cryptocurrency, minting NFTs, it is all a huge amount of effort. Unless a fan is extremely interested in this space, they just aren’t going to bother.
There are a lot of projects trying to address this issue, NFT apps like Veve have lowered the barrier to entry, but there is a long way to go. If teams are going to launch an NFT project, they need to have strong communication and marketing team in place to make sure there is plenty of help, guidance and education available.
Personally… I would only launch an NFT project once I believe the customer experience is accessible for the vast majority of fans, not just a small subset. Only 5% of Liverpool’s NFTs were sold as part of their launch - I wonder how much of a role poor customer experience played.
The relationship between fans and teams is unique… tread carefully!
We all know the relationship between fans and their sports team is unique. You can’t compare it to other consumer-brand relationships. Fans care deeply about their team, what they stand for and the role they play in the community. They will follow that team through the highs and the lows and put a lot of their household income into the club.
So, if a club launches an NFT project, it needs to be because they genuinely believe they have an amazing product to offer their fans, which is easy to engage with. If it is about piggybacking on the NFT craze to make some additional money, fans will be able to see right through this. Yes, you might make some money, but you will also alienate the majority of your fans. If you need some convincing, check the comments on any Tweet from a club launching an NFT project.
So, if you are thinking about launching a project, check yourself and make sure your intentions are right.
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All of this said, this is an exciting space. I believe there will be a time when NFT powered memberships are mainstream. NFT tickets are already becoming common. But it is so difficult to introduce NFTs in a genuinely impactful and meaningful way at the moment.
I would let the market and the technology mature a little more. Watch the adoption of crypto grow and see what utility works for successful projects. Once these elements have evolved and you have thought through the fan experience, then go for it.
Thank you for reading! Do you want to transform your fan experience? Using Fanbase technology, sports teams have just one platform to manage all elements of fan engagement, from ticketing & memberships to content and everything in between. Book a demo call or get in touch today to learn more and get started.