SPONSORSHIP AND THE METAVERSE: A FAD OR THE FUTURE OF OUR INDUSTRY?
What is the Metaverse? How does it work? Should we invest in it? As a sponsorship agency, these are the questions being posed to us by our partners in both the brand and rights-holder spaces.
Using words like metaverse and NFTs might impress in the boardroom, but when it comes to making decisions about whether to invest in this new space, the basics should still apply.
Begin with your objectives. What are the measurable outcomes that your brand wants to achieve through your sponsorship leveraging activity? Who are you trying to reach? Where do you see yourself as a sponsor or rights holder five to ten years from now?
For some, the metaverse might form an integral part of that solution framework, but for others, it is likely to offer little or no value to them.
What is the metaverse, and how does it work?
The term metaverse is widely defined as a (hypothetical) virtual reality environment in which users interact with one another’s avatars and their surroundings in an immersive way. In other words, the metaverse is a 3-D-enabled digital space that uses virtual reality (VR), augmented reality (AR), and other internet and semiconductor technology to allow people to have lifelike personal and business experiences online.
Currently, there is no single gateway to enter the metaverse, with most users accessing metaverse environments using iOS or Android-powered smartphones or tablets. However, to truly immerse yourself in all that the metaverse has to offer, the intention is for it to be accessed using an AR or VR headset.
Metaverse environments are built utilising artificial intelligence (AI) and blockchain technology to create a decentralised virtual world where audiences can safely and freely engage in social and economic activities using cryptocurrency to transact that transcend the limits of the real world.
Globally Decentraland, Sandbox, and Roblox are the leading 3-D-enabled virtual world platforms wherein digital plots can be purchased and developed as desired by the owner.
The impact of the Metaverse on the sponsorship industry
With this world expected to grow into a trillion-dollar industry and a reach of over 700 million people by 2030, we are merely scratching the surface when it comes to the metaverse and the possibilities that surround this technology from a sponsorship perspective.
In terms of fan engagement, the metaverse is a game-changer for accessibility. It provides new ways for brands and rights holders to interact with audiences in attendance and at home, and for fans to interact with each other. From access to behind-the-scenes content to interactions with players and teams to opportunities to buy NFTs and other digital assets, the sky is the limit.
For sporting codes like tennis, golf, and baseball which all have notoriously aging fan bases, the metaverse opens a realm of new possibilities to engage with a younger audience that is set to grow exponentially in the years to come.
Furthermore, the sponsorship space is a cluttered environment with different brands vying for fan attention. Not only does the metaverse provide an opportunity to differentiate brands from other sponsors, but it also has the potential to play a vital role in differentiating brands from their competitors.
Success stories - AO Metaverse
Internationally, a host of brands and rights holders have turned to the metaverse to leverage their respective partnerships and to reimagine fan engagement as we know it.
Recently, the NFL hosted its first-ever Super Bowl concert in Roblox. The league also announced a new venture with software company Intuit by launching Super NFL Tycoon, a virtual metaverse experience where fans simulated the business practices of running an NFL team.
"Only one in four high school students has access to personal finance courses," shared Lara Balazs, Intuit’s Chief Marketing Officer. "We’re committed to finding innovative ways to expose more young people to financial literacy tools, and the metaverse provides an age-appropriate environment to introduce younger people to important financial concepts in a fun and engaging manner."
Arguably the most successful venture into the metaverse from a sporting perspective has been that of the award-winning Australian Open (AO) Metaverse. The AO welcomes just under a million fans through the gates at Melbourne Park annually. The tournament also boasts 900 million global viewers, so with that in mind, the objective for the AO was simple: to become the world’s most accessible sport and entertainment event and to solve this, they created their virtual world.
In 2022, the Australian Open launched the AO Metaverse to fans with the release of 6,776 unique tennis art ball NFTs. The NFTs ranged in price based on their designs and the number of pieces available within the three different collections offered. Each art ball was assigned a square that corresponded to a 19 cm2 square on one of the courts at Melbourne Park. After each match, the match-winning point was matched up with the corresponding square and the matching art ball.
During the tournament, the AO Metaverse Melbourne Park Experience hosted in Decentraland offered fans a variety of experiences, including access to behind-the-scenes content, concerts, opportunities to purchase digital wearables, and various brand activations and activities.
What separates the AO Metaverse from other similar ventures is the strategy behind the execution. By purchasing an NFT art ball, fans effectively gain membership in a supporters’ club with access to unique experiences and exclusive partner benefits. All art ball owners automatically get free tickets to select matches, and owners of match-winning art balls get treated to unique experiences at the corresponding match the following year.
With a clear long-term strategy in place, the AO Metaverse has already played and will continue to play an integral role in the tournament’s objective of becoming the world’s most accessible sports and entertainment event.
The Metaverse in South Africa
Locally, Nedbank and MTN are the first major brands to have invested in the South African-based Africarare metaverse by purchasing space in the Ubuntuland virtual world.
MTN successfully hosted the African continent’s first virtual concert in the metaverse towards the end of last year, and Nedbank leveraged their sponsorship of the Nedbank Golf Challenge by creating a first-of-its-kind virtual experience for the local market that replicated the fan experience enjoyed by golf fans at the tournament.
It is no surprise that Metaverse claimed second place in the Oxford English Dictionary’s 2022 Word of the Year contest, but just because everyone is talking about it doesn’t mean that you have to invest in it.
I believe that the metaverse is here to stay; it’s not a fad, but it’s also not for everyone. At least, not yet. Principally, using it as a leveraging tactic needs to align with your objectives, and similar to any other campaign, it needs to form part of a well-rounded strategy.
Building a metaverse experience is only part of the equation. The content and opportunities for engagement with fans need to be relevant, the experience needs to tell a story, and there needs to be a reason for audiences to want to return.
It isn’t a case of build it and they will come. Metaverse experiences need to be marketed just like any other experience, event, or activation if you want to reap long-term benefits.