NFTs (non-fungible tokens) are becoming increasingly popular throughout many industries as businesses and consumers alike begin to understand their benefits. From art to luxury goods and sports, auctions for digital artwork and sales of digital collectibles enabled by NFT technology are commanding millions of dollars. NFTs are also powering Esports digital collectibles, opening up profitable revenue streams, and helping teams to engage with their digital-native fanbases. But, what exactly are NFTs and how can you use them to increase fan engagement and profit for your Esports team?
What Are NFTs?
In a nutshell, NFTs are digital assets on the blockchain that can be created in the form of trading cards, video moments, art, collectibles, and even virtual pets. NFTs are commanding such high interest (and prices) because scarcity and rarity are inherent in them and their authenticity can be instantly verifiable with blockchain technology. This means that they can be created either as unique or limited-edition items that come with an immutable history of their ownership.
Blockchain’s immutability also means that NFTs can never be replicated, forged or destroyed, and, unlike their physical counterparts, will never decay over time. They’re also much more liquid and easy to trade on a peer-to-peer basis and can be sold for fiat currencies, which increases fan engagement and generates key revenue.
Popular artist Grimes, for example, recently sold $6 million worth of digital artwork in a series of 10 pieces, some unique and others limited editions. The National Basketball Association project NBA Top Shots, launched in October 2020, has already seen fans spend more than $230 million buying and trading digital collectible video moments of NBA player highlights.
NFTs for Esports Digital Collectibles
The same fever is gripping the world of Esports. Fans can trade, buy, and sell digital collectibles for Esports of their favorite Esports athletes and personalities, in a similar way to traditional collectible cards but with all the aforementioned advantages.
Non-fungible tokens for Esports are particularly appealing to a younger generation of digital natives who are no longer interested in trading tattered and dirty physical cards that lose value as their condition erodes or that have to be traded in-person or through a trusted third-party. One of the main benefits of blockchain technology is that fans can trade securely on a peer-to-peer basis with instant verification of authenticity and provable ownership.
Esports teams are increasingly using NFTs to create their own trading cards, in-game items, and digital collectibles that can support their own marketing initiatives, such as promoting an upcoming event or issuing new items per player, game, or season.
Since NFTs allow for the creation of limited-edition series, teams can use them to drum up interest and raise awareness in particular campaigns, increase engagement, and unlock new revenue streams. As we witnessed from NBA Top Shot, one single NFT can generate massive profit for a team – a 13-second video moment of star player Zion Williamson recently sold for a whopping $100K.
Other NFT Use Cases for Esports Teams
Outside of Esports digital collectibles, teams can combine Esports technology with blockchain to further monetize their fan bases and increase loyalty and engagement. Fan tokens are proving to be very popular among Esports fans, with the initial fan token offering of leading Spanish Esports organization Team Heretics selling out in just 20 minutes – and generating 250 million euros in profit.
Fan tokens can be used in a myriad of ways; to allow fans to make in-platform purchases, such as in-game items, stream subscriptions, merchandise, and digital collectibles, or be accumulated to give holders voting rights and participate in key decision-making affecting the team. All these actions allow teams to interact with their fans in new ways, fostering a deeper sense of belonging and loyalty – and earning key additional revenue for the team.
Fan tokens generated on a blockchain-based fan loyalty platform create a fan-centric ecosystem that can be a goldmine for clubs and teams looking to form more profitable relationships with sponsors or partners. Not only can fans interact directly with sponsors, by making purchases or watching sponsored content, for example, but team stakeholders and even sponsors can have access to rich engagement metrics that are verifiable and immutable. This means that they can understand exactly which types of actions and campaigns generate the best response and tailor them to their audience.
NFTs and Esports – The Key to Future Fan Growth
NFT assets have seen enormous growth in recent years, rising from $40.9 million in 2018 to over $338 million in 2020 – and they’re showing no signs of slowing down. At the same time, the popularity of Esports is on the rise, on track to surpass $1.5 billion by 2023. Both attractive to a younger digital native audience, NFTs and Esports are a match made in Heaven.
And, with more and more Esports teams – from Team Heretics to OG and Alliance – all embracing the power of blockchain technology to help them monetize and engage with their fan bases, it’s time your team started taking digital collectibles seriously.
As an experienced and reputable enterprise blockchain services provider, Protokol provides highly customizable NFT solutions for sports and Esports teams. From digital trading cards to fan tokens, we create bespoke NFT solutions to help your Esports team better engage and monetize your fanbase.
All our solutions are easily integrated into your existing IT infrastructure and are highly scalable so that they can grow in line with your fan base and marketing initiatives.
Get in touch with Protokol today to find out how we can help your team better engage, monitor, and monetize your fanbase with NFT technology by booking a free consultation with our blockchain experts at protokol.com/contact.