Sports fans around the globe have been known to drop eye-watering amounts to show their love for their favourite teams, but now an academic at Deakin University has suggested AFL clubs tap cryptocurrency as their next big merchandising tool.
Dr Michael Naraine from the Deakin Business School said a club-based blockchain could be used for everything from buying tickets and memorabilia to skipping ahead in the waitlist for membership.
"Imagine if you could own a Cats Coin or a Tiger Token through the blockchain system to buy tickets and merchandise or hold onto the cryptocurrency as demand grew and it increased in value," Naraine said.
Clubs would also be able to raise equity for new facilities by selling crypto tokens to the public through and initial coin offering (ICO) in exchange for an established fiat currency.
However, for a team to actually derive continued value from the ICO it would have to plan opportunities to enhance the value of token ownership, he said, in order for it to be an attractive offering for fans and currency speculators, and not just a gimmick.
"For example, token owners could receive a physical certificate denoting a certain status, they could use their token to buy tickets, use tokens to go further up the membership wait list, or even have access to exclusive content and experiences.
"As the token rises in value, the club benefits from increased revenue because although the ticket price may remain token price static, the actual token they receive from the transaction is higher - bringing in additional revenue."
Another caveat is that clubs would have to tackle the digital skills gap, which Naraine said hasn’t always been the AFL’s forte.
"Too many sporting clubs and organisations were too slow to engage strategically and cleverly with the business growth potential of social and digital; sporting clubs that fail to at least explore the new frontier and potential of blockchain do so at their own risk," he said.
Naraine’s paper, 'The Blockchain Phenomenon: Conceptualizing Decentralised Networks and the Value Proposition to the Sport Industry' [paywall], was published in the latest issue of the International Journal of Sport Communication.