The Woes of the Crypto Market
The crypto market is in a slump, and it seems that the longer it stays in the bearish territory, the more marketing deals with American sports teams are vanishing like a cheap crypto investment. Firms once eager to plaster their logos on jerseys are now tightening their belts, which might feel a bit like that moment when you realize your jeans aren’t as forgiving after a big dinner.
FTX: Rethinking the Strategy
According to a report from the NY Post, crypto exchange FTX is now re-evaluating its marketing strategy that included slapping its name on the Los Angeles Angels jerseys. Talk about cold feet! With the market dropping harder than my phone when I forget to put it in my pocket, FTX’s marketing dreams look to be on the chopping block.
Other Sponsorships on the Chopping Block
The doom and gloom doesn’t stop there. Rumor has it that another deal with an undisclosed crypto firm and the Washington Wizards was also canned right as the market started its downward spiral. Sources suggest this particular firm might be FTX.US, as their NFT platform has an existing relationship with the Wizards. It’s almost as if the crypto companies are hit by a double whammy: not only is the market crashing, but now they’re missing out on court-side seats with D.C. politicians.
The Expert’s Take
Sports management professor Joe Favorito from Columbia University weighed in, stating, “What money hasn’t been spent already you’re going to see curtailed — just like we saw during the dot-com bubble.” Well, if that isn’t the most sobering reminder to tread cautiously in the volatile crypto space. Favorito suggests that any new sports partnerships are unlikely to be announced until the market stabilizes.
Remember the Good Ol’ Days?
Cast your mind back to the euphoric high days of the crypto boom. Firms were throwing cash around like they were at a shouting contest for the biggest marketing budget. Crypto.com sealed the deal at $700 million for naming rights to the LA Lakers’ home arena for 20 years. Meanwhile, FTX splurged $135 million for the Miami Heat’s FTX Arena, and Tezos committed to a jaw-dropping $27 million yearly to brand Manchester United’s uniforms.
Shifting Tides
With sponsorships focused on basic brand visibility being questioned, a silver lining appears. Deals between real-world products and NFT firms are solidifying, evolving into a partnership model that benefits more than just visibility. For example, Budweiser just forged an alliance with the NFT horse racing platform Zed Run, offering tokenized Clydesdales for minting alongside a festive track event with a whopping maximum prize of $95,000. Now that’s how you gallop through a recession!
The Future of Crypto in Sports
NFL superstar Tom Brady’s Autograph NFT marketplace is also on the front lines, collaborating with ESPN to bring fresh content to sports enthusiasts. Alongside the launch of a parallel NFT collection, this activity coincided with the airing of Brady’s docuseries on ESPN in April. Talk about hitting the nail right on the head with timing! It seems the synergy of sports and crypto is far from over, even if they’re currently navigating choppy waters.
