On Today’s Agenda:
Welcome to the Simulation
The Investment Sports Have Put into Content
Athletes Put The Sports World on Notice in 2021
The Rise of the NFT
Welcome to the Simulation
NBA TopShot
When we look back at the year that was 2021, it is impossible to ignore the impact of COVID-19, a pandemic that continues to impact lives across the world. Whether in the world of sports, fashion, music, or beyond – there is nothing more important than health. As a result, 2021 continued to require sports leagues to get creative with digital engagement. As arenas, fields, and stadiums were closed or reduced to a lower capacity, fans were unable to engage with their favourite teams and players in the same way they were used to.
With the birth of the blockchain and the introduction of the Metaverse, there is a lot of speculation on how far technology will shift our future. For the world of sports, one of the bridges between the real world and the virtual world has been the usage of the NFT.
The NFT, also known as a Non-Fungible Token is a digital collectible that is verified and certified by a network of computers known as a blockchain. For a more technical breakdown of the concept of an NFT, here’s a handy starting point written by yours truly. Many athletes and leagues began to venture in the space throughout the year, including athletes who auctioned them off for charity, all the way to NBA Top Shot, a league-backed digital trading platform that brings basketball cards to life.
In all, over $1 billion in sports NFTs transactions were completed, with some NBA Top Shot moments selling for over $200 000. There is clearly a market of sports fans who want to expand their collection beyond physical trading cards and memorabilia, and NFTs have tapped into that market. It has given leagues, teams, and players an opportunity to create a new revenue stream. But the question that was asked all year long, and is still being asked as the year comes to an end by many is – what is the value in a digital collectible? You cannot touch or feel it in real life like you would a puck, ball, or trading card. The funniest chirp I continue to see online is “why can’t I just save a picture on my phone instead?” – and the answer will always be the value-added of the NFT. Whether it is ownership of an asset that is recognized by the sporting entity and the audience, or additional value that comes with holding the NFT, the value will look different and feel different for all collectors. And between us, most critics of NFTs were once critics of trading cards and future critics of new sporting products that connect fans to sports.
2021 was also a big year for white whale mktg, as the team made a huge splash in the middle of 2021 with the official launch of our NFTs. We dive into the story behind our NFTs in this week’s wwm pod episode – a project that was birthed and completed in just over a week after Niko Giantsopoulos asked Chris if we can try it out. We not only minted 3 NFTs (one for Niko, one for Ben Fisk, and one for Micah Awe), but also helped Niko, Ben, and Micah become some of the first athletes in their respective leagues to have their own NFT minted and launched. Behind these NFTs also came additional value for the holder, including meet-and-greets and player merchandise from the white whale mktg collection.
Listeners of the wwm pod will also hear about how we got to the 1-yard line, and took a timeout with the NFTs due to their “gas prices”, the cost to list on the blockchain, which is a volatile charge that the buyer and seller may have to pay. This leads me to the most important (and maybe more underrated) part of the NFT trend of 2021 – the cost.
Not only is there a financial cost that comes with owning NFTs, but the environmental impact of the blockchain is easy to overlook. With a network powered by computers that are constantly operating at high capacity, the electricity required to keep these machines running has a strong carbon footprint (as does any electronic that runs at high capacity). When interacting with digital products in the virtual world, it is easy to turn a blind eye to the physical impacts on the real world – how our devices are produced, how we produce energy to keep operating, and what consequences it has to the future to our environment and climate. The Seattle Kraken, who recently launched their own NFT collection, received a lot of criticism for this venture, which critics say is contrary to their pro-climate and sustainable leadership brand.
When looking back at the trends in sports, it is equally important to focus on the positives and the negatives. It is evident that there is a lot of excitement around NFTs, and the potential that exists for fans to connect with their favourite sport, league, team, and player. However, the consequences are equally as uncertain, and can also grow exponentially. As I mentioned at the beginning of this piece, there is nothing more important than health. 2021 not only did justice to that statement from a personal health level but continued to remind us that the health of the environment and the world around us cannot be underestimated.
Sports Content Coming to a Screen Near You
The Investment Sports Have Put into Content
Amazon
This past year we’ve been spoiled with endless amounts of sporting content pieces to watch on our favourite viewing platforms. We’ve seen more limited series, investment into more engaging tv broadcasts, collaborations and even original content from clubs.
At the beginning of the year, we were discussing how we enjoyed NFL collaborations such as their Nickelodeon games, where slime and more kid-friendly broadcasts were shown to attract a younger audience. It was different and a great way to try something new, but we wanted more collaborations in the future. As my dad said the squeaky wheel gets the oil, thus the sports world heard us and gave us a Monday Night Football x Drake collab, who would’ve thought? Collaborations like these are what sports need! How else are we going to pull new audiences into the sports we love? You need to understand what their interests are and align them with the product you’re offering. Thus, using Drake to bring non-typical sports fans to MNF was a great move.
Like the NFL, the world has been constantly moving and changing our expectations on how we consume sports. With that, limited series took the world by storm more than ever. When games were cancelled or postponed we needed our sporting fix and limited series provided just that. The hockey world saw the Maple Leafs on Amazon’s All or Nothing Docu-Series and it was a hit! Fans were able to get a peek into the historic franchise and see what their favourite players were really like. Personalities create fans. No one cares what Director Z of the Maple Leafs does on Tuesday, they want to know what Matthews, Marner, Nylander were like after wins, losses, or off-days. These players, these people, are what take fandom to the next level. Viewers can go into a limited series being a general fan of sports and leaving being Matthews’ top fan, the personalities push the needle.
Teams understood that personalities push the needle loud and clear in 2021, now more than ever teams are investing in their own original content series. Fans want to always have access to something like Amazon’s All or Nothing series for all of their favourite teams. With fans demanding more all-access content and teams needing more dollars, the perfect storm was created. It’s allowed clubs to have an additional asset. They now have a new platform to push new partnerships like product placements within these original content pieces and at the same time they can build up their biggest assets, the players.
The Year of the Athlete
Athletes Put The Sports World on Notice in 2021
REUTERS/Sarah Meyssonnier
Things change. People change. Feelings change too. Never thought the circumstances woulda changed you. But they did. Drake said it best and now athletes are saying it to the world of sports, and it’s time to wake up.
The Year of the Athlete, what does that mean? Athletes have been evolving year over year, as people do, but this year was different. Now more than ever athletes are taking control. They’re standing up for what they believe in, recognizing their worth, and maximizing their potential.
One of the biggest sporting stories in 2021 was Messi departing Barcelona to join PSG. This event was impactful for two key reasons: it was the end of an era for European football and major financial implications were at play for two of the biggest clubs in the world. Let’s focus on the latter, financial implications involving clubs and this star athlete. With pockets already being thin for major clubs due to the pandemic, a move involving Messi would be monumental. For PSG, they saw crazy numbers across their brand, from the rise in social media to their fanatics store selling out. As for FCB, many of their sponsorship deals were tied to the Argentinian as global brands wanted to be connected to the star. The result? Once Messi left FCB it just magnified their financial issues.
The lesson that was learned for both athlete and club in the year of the athlete is clear: for athletes - know your worth. The power and potential you have for both yourself and your club is larger than you think, as you the face of both brands. For clubs - diversify your assets. Anyone would be over the moon to have a star at the magnitude of Messi. But, as the saying goes time is money, and when that time runs out so does your cash. By all means maximize the assets you do have for ticket sales, merchandise, partnerships, etc., but at the same time look to build the brands of your other athletes. The more time you have with athletes who have strong personal brands only increase the potential revenue you can generate. More time = more money.
Three years ago, I had discussions with clubs asking if they would ever see themselves investing in athlete branding. Every discussion had the same answer, it’s interesting but that’s not within our core business. The same question has been asked and the answer has changed. 2021 was The Year of the Athlete and I have no doubt it’s just the beginning.
*Can’t forget about the impact NIL had this year in college sports, for more information read a past post: https://www.whitewhalemktg.com/blog/500-for-a-burger