Nascar teams selling merchandise is as old as the sport itself. Fans can buy all sorts of products that support their favorite driver or team. From t-shirts to can koozies to ornaments that hang on Christmas trees there is almost no limit to what’s available. It’s an important revenue stream that helps keep the wheels turning on the track.
One team, however, has found a new way for fans to support the team, its drivers and create a revenue stream that was unheard of just a few years ago. Roush-Fenway Racing (RFR) will soon offer cryptocurrency-based digital ‘fan tokens.’ It’s a way that will not only generate income but take fan engagement to an entirely new level.
Roush is the first Nascar team to enter the world of the blockchain, a digital world where cryptocurrency exchanges hands electronically. They join the New Jersey Devils in the National Hockey League and the Ultimate Fighting Championship as the only U.S. sports franchise to partner with Socios.com a direct-to-consumer platform, created by Chiliz, that uses blockchain technology to help teams engage with fans. Roush will sell “Fan Tokens” that will be held electronically by Socios with the team getting part of the sale.
“The pandemic has had a massively damaging impact on revenues at major sporting organizations,” Alexandre Dreyfus, CEO of Chiliz and Socios said. “Even before the pandemic, it was clear that the business models for many clubs, teams, organizations were unsustainable and that new sources of revenue were needed.”
Dreyfus said the pandemic was a wakeup call for all of sports.
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“That’s why we’re seeing so many teams embrace Fan Tokens and the Socios.com platform,” he said. “We’ve already generated well over $120M revenue to be shared among our partners in 2021 alone. That’s compared to $30M in 2020, admittedly with a smaller roster of partners. But it’s clear that Fan Tokens are growing exponentially, and the potential is massive. Major sporting organizations – whether that means teams, leagues, federations, franchises need to become a part of this, or risk being left behind.”
Roush will be part of a network of 29 major international sporting properties on the Socios.com roster which also includes European soccer teams FC Barcelona, Paris Saint-Germain, Juventus, AC Milan and Manchester City.
It’s those big partnerships that according to Dreyfus attracted a Nascar team from North Carolina. A team not only seeking a new revenue stream but a new way to engage with fans.
“Most – if not all – commercial managers at the leading sporting organizations know who we are,” Dreyfus said. “RFR is a great showcase really in terms of launches. From the outset they showed a willingness to embrace Socios.com as a tool to improve engagement with their fans. Those same fans now have a really clear view of how they can get closer to the team right from launch, with a packed calendar of engagement activity and multiple chances to influence RFR on the immediate horizon.”
It’s the ability to have a say in team decisions that is key to the engagement.
“That’s really important for diehard fans who live locally and want to feel an even closer connection with their teams,” Dreyfus said. “But we believe that it’s even more important for those fans who are maybe hundreds, if not thousands of miles away who want to maintain and strengthen the bond with the teams they love. And it’s not just voting, we’re constantly updating our app and increasing the utility of Fan Tokens on Socios.com. Fans love to feel recognized by their clubs and through various features, including leaderboards and badges fans can gain superfan recognition which in turn unlocks VIP rewards.”
In the past, those VIP rewards included in-person visits with the team allowing fans the chance to get up close and personal. But when the COVID-19 pandemic hit, like many companies, Chiliz and Socios were forced to move entirely online.
“We upped our game by creating some very cool digital experiences such as having fans appear on the LED boards at stadiums during soccer games,” Dreyfus said.
The announcement of the partnership comes as the sport, and the world, starts to emerge from the COVID-19 pandemic. Fans are now being welcomed back which will allow for in-person experiences once more.
“In the case of NASCAR and Roush that could be getting the chance to meet the drivers and the team and to go behind the scenes at a meeting for instance,” Dreyfus said. “We’re also looking to link partner sponsors into the app, unlocking exclusive promotions and additional benefits for Fan Token holders. Plus, we’re constantly looking for new ways to bolster our in-app content, that means more games, more competitions, more exclusive content for Fan Token holders.”
The total lifetime supply of 5 million $ROUSH Fan Tokens will be available at a starting price of $2. They could be exchanged for physical merchandise, VIP experiences or allow fans to have input into a wide range of the team’s decisions starting with the chance to select race car paint schemes, team uniforms, pit signage and other assets for the RFR Fords of drivers Ryan Newman and Chris Buescher at the August Cup Series race at Watkins Glen.
“This is one of the more unique partnerships I’ve ever been a part of, and it’s a really cool concept that I can’t wait to see come to life,” Buescher said. “Giving the fans the ultimate influence on our designs will be fun to follow, and I’m interested to learn more about the business myself.”
While the number of tokens that will be available hasn’t been released yet, it can be a moneymaker for a team. Last June when soccer champions FC Barcelona began selling their allotment of 600,000 tokens, they generated 1.2 million euros ($1.3 million) in less than two hours.
Nascar fans are known to be some of the most loyal fans in all of sports. Now, that loyalty can be incentivized, and monetized. With that kind of potential, the fan token is a new revenue stream that other teams will surely want to take advantage of. It’s something that “will resonate very well throughout the industry,” according to Roush Fenway president Steve Newmark.
Blockchain technology is a far cry from selling from t-shirts, can koozies and holiday ornaments. And while Roush-Fenway Racing may be the first team to jump on board, it may not be the only one.
“In reality, for NASCAR teams and teams across all sports, it’s a case of the sooner the better,” Dreyfus said.
“It’s clear that Fan Tokens are growing exponentially, and the potential is massive. Major sporting organizations – whether that means teams, leagues, federations, franchises need to become a part of this, or risk being left behind.”