NFTs and sports case studies: AFL, Australian Open, Real Madrid

To begin considering the impact of NFTs in the world of sports, let’s examine a few case studies.

Case Study: AFL (Australia)

In 2022, Australian sports franchise the Australian Football League (AFL) partnered with technology provider Animoca to bring NFTs to this popular Australian sport.

The core product on this new digital platform is to enable AFL fans to purchase and own “moments” from present and past matches. The idea of sports moments was pioneered by the NBA with their hugely popular Digital Collectible platform “NBA Top Shot”. Other major global sports franchises have also done similar deals, such as the ICC’s Fancraze, the UFC’s Strikeforce, and MotorGP’s Ignite platforms.

The NFTs are minted to host moments such as brief digital video clips or stills of memorable plays. The NFT format enables fans to provably own limited editions of these formats. Prior to their sale as NFTs, these clips and images were owned by the AFL and, depending on contract details, sometimes in conjunction with the players. This same format also allows players to issue their own NFTs, although this is yet to happened in this application of NFTs.

These digital moments, as NFTs, can then become a platform for further upselling of the product, including connecting these to ticketing, season passes, game day rewards and other possible sponsor participation modes.

Case Study: Australian Open (Australia)

In 2022, Tennis Australia launched a range of NFT based products during the Australian Open in Melbourne. These were highly successful, innovative product launches with strong brand engagement.

Tennis Australia’s product launch included the release of a range of NFT collectibles of historic moments from the past 5 decades in the Australian Open. This enabled tennis fans to own these bits of digital property, and to display them on their own devices. This model enables not only ownership of past collective moments, but sets Tennis Australia up to continue to sell these at future events. They also developed their own platform that also sold event merchandise such as digital ‘art balls’.

Covid travel restrictions were a major hurdle for an event that traditionally relies on large in person attendance, but Tennis Australia used NFTs to lead the development of a virtual reality based (i.e. metaverse) way to watch the tennis, partnering with crypto real estate play Decentraland. This enabled Tennis Australia to sell pieces of the virtual court, creating a novel and innovative revenue stream that was then integrated with match play. If the ball landed on a piece of virtual land that a fan owned, they would be awarded sponsor prizes and other incentives, such as bonus viewing material and even actual match balls.

Case Study: Real Madrid (Spain)

Real Madrid, one of the world’s leading football clubs, has moved heavily into the NFT space, partnering with technology provider Dapper Labs on the Flow blockchain. The model uses a dedicated blockchain to offer digital moments, ticketing and other fan engagement. The product market fit has been very successful, and the technology is both highly functional and intuitive. Real Madrid NFTs are a good case study for other clubs seeking to understand the process and benefits of a web3 digital platform.

Real Madrid, which uses the Dapper Labs Flow blockchain, has also allowed some of its players to make deals on different blockchains. For instance, in 2021 Real Madrid Player Toni Kroos launched his own NFT collection on the Binance Smartchain. Kroos now uses the proceeds from the NFT sales support his charity the Toni Kroos Foundation.

What is particularly impressive here is the scale of the operation. Real Madrid claims 600 million global fans, and NFTs create a new platform for fan engagement (called LAVA) which includes a marketplace for trading. Because this is a global operation, it is useful for the platform to have its own currency. In this way, Real Madrid has used NFTs to not only become a global community, but one with its own economy, money and digital property rights system. Fans can invest in building their own community. This is a powerful model for sports clubs to then build this type of digital global infrastructure which they can then extend to other smaller sporting clubs and community organisations.