Crypto advertising has been plastered across every available sporting surface since the bull run of 2021, from stadium naming deals and team\u2019s playing kits to Formula One racing car liveries. But in the current bearish market conditions, it seems hard to calculate a return on the ubiquitous spending of 2021\u2019s crazy big advertising.\u00a0<\/strong><\/p>\n In Australia, where I\u2019m based, there was a sharp uptick in crypto firms spending big on ads and sponsorship deals in the Australian Football League in 2021\u20132022. While it may make sense for a local crypto exchange, why would a global project spend big dollars on a sport that isn\u2019t even the major football code in every state, given some of the bigger states prefer the National Rugby League?<\/span><\/p>\n Take, for example, the Staples Center in downtown Los Angeles, home of the National Basketball Association\u2019s <\/span>Lakers<\/span> and <\/span>Clippers<\/span>, the National Hockey League\u2019s <\/span>Kings<\/span> and the Women\u2019s National Basketball Association\u2019s <\/span>Sparks<\/span>. It got a new name on Christmas Day 2021 \u2014 Crypto.com Arena \u2014 for a reported $700-million dollar deal.\u00a0<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n While financial terms of the 20-year deal weren\u2019t publicly announced, it is believed to be the most expensive<\/span> naming rights deal<\/span> in sports history. Time will tell if it was money well spent. As the home court where the late Kobe Bryant played basketball, many today will still call it the Staples Center indefinitely, but a younger generation likely will not.\u00a0<\/span><\/p>\n Crypto.com wasn\u2019t the only brand spending up big on sports deals.<\/span><\/p>\n VeChain paid $100 million to plaster its logo throughout the Ultimate Fighting Championship arenas. Will getting the barely recognizable logo in front of kickboxing fans on TV lead to any new customers for its supply chain tracking solutions or onboard new users into the crypto ecosystem?<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Is this all just wasted expenditure born of a bull market or a clever long-term commitment to advertising crypto adoption?\u00a0<\/span><\/p>\n It depends on who you ask. There have been a few backhanders from notable crypto figures toward the practice.<\/span><\/p>\n In June this year, <\/span>Crypto.com<\/span> announced a 260-employee lay-off, equating to a 5% cut of its workforce. Binance founder Changpeng \u201cCZ\u201d Zhao tweeted, \u201cI<\/span>t was not easy saying no to Super bowl ads, stadium naming rights, large sponsor deals a few months ago, but we did. Today, we are hiring for 2000 open positions for #Binance.\u201d<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n It was not easy saying no to Super bowl ads, stadium naming rights, large sponsor deals a few months ago, but we did.<\/p>\n Today, we are hiring for 2000 open positions for #Binance<\/a>. pic.twitter.com\/n24nrUik8O<\/a><\/p>\n \u2014 CZ 🔶 Binance (@cz_binance) June 15, 2022<\/a><\/p>\n<\/blockquote>\n \u00a0<\/p>\n \u00a0<\/p>\n Not all sports sponsorship deals are of dubious value, however, and marketing experts in the space say crypto marketing spending can be justified depending on crypto market product segmentation and brand authenticity.<\/span><\/p>\n Chris Ghent, head of brand strategy at the Near Foundatio<\/span>n \u2014 a climate-neutral sharded blockchain project \u2014 has tipped funds into sports sponsorships but also believes that they can<\/span> be a huge waste of money if done wrongly.\u00a0<\/span><\/p>\n \u201cHistorically, crypto projects beyond exchanges have ignored paid media. And without explicit use cases tied to the massive dollars paid for sports marketing sponsorships, the branding only leads to logo exposure.\u201d\u00a0<\/span><\/p>\n<\/blockquote>\n<\/blockquote>\n For these huge sports sponsorship deals, the metrics to determine the returns are unclear. But as exchanges are the gateways to crypto adoption, aren\u2019t they doing everyone else in the industry a favor by spending big to onboard new retail users from the mainstream sports community?\u00a0<\/span><\/p>\n Yes, says Ghent, \u201cbut sports sponsorship of a significant amount is reckless. Terra sponsoring the Washington Nationals \u2014 what good is that doing today?\u201d He\u2019s referring to Terra\u2019s major sponsorship of the baseball franchise in the United States capital. It <\/span>signed<\/span> a five-year, $38.15 million deal with the Nationals paid upfront in cash. Then, Terra collapsed. Bad press for all concerned, though, at least the team gets to keep the money.\u00a0<\/span><\/p>\n This year there are 10 F1 motorsport teams, and crypto companies <\/span>sponsor<\/span> eight of them. It can be argued that is smart marketing. Research by global analytics company Nielsen Sports<\/span> found<\/span> that F1 has the potential to reach about 1 billion fans globally, with the 16\u201335 age group accounting for the biggest share. The market segment sponsorship logic there is apparent though whether that justifies the exorbitant cost is another matter.<\/span><\/p>\n Ghent argues that carefully chosen sponsorship deals that are deeply integrated partnerships can be value for money if they are designed with authenticity. The Near Foundation has begun sponsoring sporting properties such as SailGP F50 catamaran sailboat racing. The value of that deal is undisclosed.<\/span><\/p>\n Ghent insists the SailGP spending is not reckless in the way some might argue crypto exchange Bybit sponsoring Red Bull\u2019s F1 Racing Team in a three-year $150-million deal is, for example.<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n 8️⃣ out of 🔟 teams on the grid has a Crypto-based company as a sponsor this season 👀\u2060<\/p>\n Here’s a look at which teams have crypto partnerships for 2022 👇 \u2014 Motorsport.com (@Motorsport) March 2, 2022<\/a><\/p>\n<\/blockquote>\n \u00a0<\/p>\n \u00a0<\/p>\n Ghent suggests that instead of slapping a logo on something, Near has bought the ability to integrate the protocol into the sport. SailGP is a modern version of the famous America\u2019s Cup with F50 carbon fiber boats. All the boats competing are on a level playing field with consistent design and open-source data sharing via Oracle Cloud. So, races reflect the pure skill of the athletes \u2014 unlike F1 racing where only the best-funded teams can realistically win the championship.\u00a0<\/span><\/p>\n Through the partnership, SailGP is<\/span> launching<\/span> a DAO-owned race team on the Near Protocol. The DAO community members would be able to participate in athlete selection, team management, commercialization options, operations and team strategy. He says, \u201cThe best form of marketing is that the superfans become your best advocates. The Near brand is inspiring what happens with the technology.\u201d Logically, fan-based DAO ownership means skin in the game and organic marketing engagement directly with sports fans.\u00a0<\/span><\/p>\n Ghent tells Magazine the DAO-managed team is on course to launch this season. Sports-team-owning DAOs are, of course, experiments, but the takeaway is that authentic marketing in crypto means being seen as staying true to crypto culture while finding a wider market segment.<\/span><\/p>\n You could say that\u2019s like the open-source boat designs as opposed to centralized private racing car teams with grossly unequal budgets.<\/span><\/p>\n Something similar is also being done in the fourth tier of United Kingdom Football by <\/span>Crawley Town FC,<\/span> which was purchased by crypto group WAGMI United in April, and is planning to create a DAO-managed team, too.<\/span><\/p>\n And in July, they signed a new player, midfielder Jayden Davis, after an NFT-powered vote<\/a><\/span>.<\/span><\/p>\n The small club also sold more than 10,000 NFTs this year in stark contrast to soccer powerhouse Liverpool\u2019s NFT collection, which sold poorly, perhaps to a lack of authenticity, and amounted to a marketing <\/span>disaster<\/span>. It seems the mission for Crawley Town to reach higher leagues of English football resonated with NFT buyers.<\/span><\/p>\n Another sympathetic tie-up between a brand and a sporting event is Animoca Brands gaining the naming rights for the Australian Motorcycle Grand Prix and the Aragon events this year and next. Animoca is developing the official MotoGP blockchain-based game called MotoGP Ignition and no doubt relishes the chance to highlight the game in front of a worldwide audience of 400 million racing fans. In this context, relevance is key to a good marketing campaign for those crypto believers.<\/span><\/p>\n \u201cGuerrilla marketing in crypto is all about having contextual relevance,\u201d opines Ghent. That is, the marketing is relevant to the nature of the product or protocol.<\/span><\/p>\n In marketing parlance, guerilla marketing is lauded as a way to drive publicity and brand awareness by promoting the use of unconventional, less expensive methods, such as street art or flash mobs of dancing crowds.<\/span><\/p>\n DAO-based ownership of intellectual property, such as PleasrDAO or ConstitutionDAO, is perhaps the best guerilla marketing. It\u2019s all based on ownership and \u201cownership\u201d securing the networks, notes Ghent.<\/span> Ownership and DAO participation to a degree is the ultimate guerilla marketing. It\u2019s not the token itself \u2014 it\u2019s the ability of fans to feel even greater ownership over their favorite team.\u00a0<\/span><\/p>\n Geoff Renaud, chief marketing officer and co-founder of crypto marketing agency <\/span>Invisible North<\/span>, thinks the big sporting sponsorships are pretty hollow, with too much being spent for very little return. <\/span> \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n He says, \u201cThe challenge is that most people speculating on crypto have no idea about the tech they are speculating on.\u201d The questions need to be: Why have you invested in this? What do you believe in?<\/em> They need to understand the products.\u00a0<\/span><\/p>\n The solution for crypto companies is education, especially in a bearish market. For example, how to make onboarding easier \u2014 at a marketing spending level. That means, at its most basic, t<\/span>eaching people how to set up a wallet and buy some crypto. <\/span>Education is also crucial to keeping the community out of despair. \u201cFor high conviction in the long-term, education needs to be taken more seriously.\u201d Renaud tells Magazine.<\/span><\/p>\n \u201cMarketing now is about getting people to stay in the game. The tourists will always leave.\u201d<\/p>\n<\/blockquote>\n<\/blockquote>\n Still, Renaud argues pure brand-building tactics have a place. He cites crypto exchange FTX partnering with Coachella in February to create NFTs as a good example. Ticketing and proof-of-attendance protocol, which are digital mementos of events, are now an accepted use case of NFTs with street cred. In this example, Coachella and FTX partnered to turn NFTs into lifetime passes to the famed music festival.\u00a0<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n 1) Really excited to be working with @coachella<\/a> to release NFTs!https:\/\/t.co\/MvgaqfmHqN<\/a> pic.twitter.com\/0iq0TZn9V3<\/a><\/p>\n![\"Crypto](\"https:\/\/cointelegraph.com\/magazine\/wp-content\/uploads\/2022\/08\/magazine-Hundreds-of-millions-is-spent-marketing-crypto-to-sports-fans-Is-it-wasted.jpg\")
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Wasted expenditure<\/h4>\n
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Some sports sponsorships can be value for money<\/h4>\n
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\u2060#F1<\/a> #F12022<\/a> #Motorsport<\/a> pic.twitter.com\/hN6UfSIrWC<\/a><\/p>\n![\"Wagmi\"](\"https:\/\/cointelegraph.com\/magazine\/wp-content\/uploads\/2022\/08\/wagmi.jpg\")
<\/span><\/p>\nCrypto guerilla marketing?<\/h4>\n
Marketing relevance in a bear market: Education<\/h4>\n
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<\/span>\u201cWith the big sports deals, there\u2019s no real educational element. Early 2021 showed us unseasoned marketers spending too much. We saw so much unchecked spending on partnerships and no real measurement on impact.\u201d\u00a0<\/span><\/p>\n\n
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