LaLiga Move into Web3 Gaming with GameOn

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LaLiga Move into Web3 Gaming with GameOn

The Sporting Crypto Newsletter is supported by The HBAR Foundation.

Every sports team and league is looking to do the following:

• Attract a younger audience

• Attract a digitally native audience

• Attract a more global audience

• Attract an audience that spends money online

Gaming is viewed as the answer to many of these objectives.

Why?Because it’s the largest and fastest growing market ($$$ wise) in entertainment with the youngest audience.

Fortune Business Insights forecasts the gaming market will grow from almost $300bn now, to $665bn in 2030.

Roblox generated $2.225 billion in annual revenue in 2022 and 80% of their users are under the age of 16. 

In 2021 Fortnite generated $5.8bn in revenue, 62.7% of the player base between the ages of 18 to 24. 

LaLiga, the Spanish football league are looking seriously in this direction to try and globalise their audience and lower the average age of fans.

This week they partnered with GameOn to create a Web3 Fantasy game for the US and Canada in a step to do exactly that.

This newsletter covers:

🤝 The Partnership🎮 Why is Web3 gaming such a big focus for sports IP? And why the USA & Canada?🧠 Where are we headed?

🤝 The PartnershipGameOn are a gaming startup who have developed NFT-based fantasy games for the likes of the PFL and Karate Combat.

With LaLiga, they are creating a LaLiga branded web app that will debut in the US and Canada in Q1 2024.

Fans will be able to use NFTs to build fantasy lineups that earn points based on each player’s real-life performance. They can also buy digital gear like football boots, jerseys and such to equip their in-game players giving them boosts and point multipliers.

Prizes will include cash, VIP match tickets, signed merchandise and access to players via meet-and-greets.

LaLiga plans to promote its upcoming games with GameOn through activations in their soccer stadiums, fan watch parties, and social and digital content.

In 2021 ESPN signed an 8-year deal with LaLiga for their US media rights, and FC Barcelona and Real Madrid have huge followings in that market, with both of these huge football brands slowly increasing their presence both digitally and physically in North America.

For example, Barcelona are planning a $1bn SPAC of their media business Barca Media and both Spanish giants have been increasing their on-the-grounds presence with pre-season America tours in the last few years.

🎮 Why is Web3 gaming such a big focus for sports IP? And why the USA & Canada?

Why is Web3 gaming such a market with so much interest?

It’s mainly because of four things:

1. Gaming has a young demographic and is the highest-grossing and fastest-growing entertainment market in the world

2. There has been over $1bn of VC investment in Web3 gaming in 2023 already, and in 2022 in accounted for 62.5% of the total amount invested in Web3. 

3. Web3 games, fleeting or otherwise, fantasy or other, have been some of the best examples of actual mainstream use in Web3 (NFL Rivals, Sorare, Axie Infinity)

4. Gaming has created walled gardens through publishers and Web3 believers think this technology is a way to move beyond that

But before we go further, what is Web3 gaming?

There has been a sweeping generalisation from gamers and Web3 enthusiasts around what this category entails.

It’s something that has been ill-defined to some extent up until this point.

So far we’ve seen the likes of Sorare (fantasy NFT gaming) and NFL Rivals (mobile game with NFT components) gain mass adoption through using components of Web3 but not being totally Web3 native by every measure of the word. NFL Rivals for example has had over 2 million downloads on the iOS app store in the last 5 months. 

What I mean is… NFL Rivals is a mobile game that simply allows players to purchase playable NFTs.

Sorare is a fantasy game that allows players to own their NFT cards and create teams using them.

Alien Worlds, Axie Infinity and Illuvium — which are more ‘Web3 native’ games — have their own token, have playable NFT land and most of the components of the game are NFTs. It’s a bigger leap for player and publishers than simply having an NFT that integrates into a run-of-the-mill game.

Web3 games are trying to attract a high-spending, young audience — and guess what? Sports wants to do the same.

If you take soccer, especially, the average age of viewers is actually on the older side compared to some sports.

That’s especially the case when looking at a league’s domestic statistics.

For example, In the UK - the average age of the English Premier League (EPL) fan is 41, and the average age of the average season ticket holder in the EPL is 44.

According to Statista, 71% of the EPL’s ‘avid’ fanbase is over 35. Worldwide, those audiences skew slightly younger — so it isn’t a surprise that the likes of LaLiga are trying to globalise their audience.

In the United States, the average age of soccer fans is 35, with 46% of the fan base being Millennials. For example, 40% of US soccer fans aged 18-34 identify as fans, and 47% of Generation Z adults (born in 1997 or later) say they are soccer fans.

With a World Cup on the horizon, it feels as though in men’s football — the biggest growth potential short term is in North America rather than at home. You can see why leagues are building that direction.

To add to this, 42 million people in the United States speak Spanish, and usually the primary way football teams/leagues look to globalise their brand is to go to territories where there is no language barrier. Another plus point for LaLiga.

Beyond demographics and geography, the way fans interact with sports is changing.

We know it’s skewing more short-form, instant — and fewer younger fans are consuming sport in its totality. Highlights, TikTok, Influencer watch along — the consumption experience has completely changed over the last 10 years.

In the future, this will likely lean toward more hyper-specific and curated content to each fan, with more ‘active engagement’. If we look at the growth of online gambling, gaming and fantasy over the last 10 years, as well as the way content is being consumed, — it’s clear that sports fans have developed a totally different relationship when it comes to how they exercise that fandom or obsession.

🧠 Thoughts and where we are headed

The Web3 market right now is choppy on the brand side.

Sports leagues and Web3 companies are back at negotiating tables fairly frequently, the sponsorship dollars are not as crazy as they once were. To add to that, new partnerships that are coming to the table are in another stratosphere compared to 18 months ago.

Matt Bailey CEO of GameOn said:

Sports leagues are all about the revenue, but there is also pressure to innovate and drive the average age of viewership down.

And now that quick bucks have washed away to Matt’s point, leagues are approaching this in a totally different way.

GameOn’s approach here means success could be defined by a hyper-engaged user base to start with not necessarily having millions of users.

Matt went on to say:

It’s not too dissimilar a way in which Sorare actually gained traction. Now, the Web3 fantasy platform have 200k+ users who own an NFT, with multiples of that participating week by week in free-to-play games.

DraftKings Reignmakers, the Web3 fantasy game created by DraftKings has seen incredible volumes. And that has been from just over 10,000 active, unique users.

When incorporating digital assets into any strategy or game, it’s difficult to hide if that’s a barometer of success or your application or game.

Because it’s on a blockchain, we can all see the engagement and active participation, to some extent.

With Fantasy Premier League, the Premier League’s flagship fantasy game — around 10 million people register at the start of the season. ~10% or so of those are active toward the end of the season. 1 million active participants is still a lot. On one hand, while I do think that digital assets can help sustain engagement and active participation, and get games to breakeven faster — I don’t know if the idea of a hyper-engaged audience of the low thousands can be sustainable forever. That’s especially true for a brand as big and as global as LaLiga. The thousands of super fans theory can live true but for only a certain period of time. Growth and scale need to be found to have some sort of success.

With that being said, for LaLiga to increase margins on a more global audience, the idea of monetisable engagement that is frictionless and doesn’t have the overhead of physical product is obviously exciting and very attractive, all whilst future-proofing your business model. Web3 gaming is definitely seen as a facet to do exactly that.

With Web3 games, the idea is that instead of having a free-to-play game that needs a mass audience to eventually monetise, you can monetise early with a more engaged, community-led approach that gives ownership and access to fans through digital assets. A more ‘Kickstarter’ type model where early users can own digital gaming content.

My final thought of this newsletter is the following questions…

• If you're in a league, how many different partnerships and activations can you do before they start cannibalising each other?

• Are LaLiga, broadly speaking, throwing darts at a dartboard or is there something more coherent here?

• Can this game reach enough scale at the right time after monetising early?

LaLiga’s reasoning for globalising their audience, making it younger and targeting North America as a market for expansion all make sense.

The goal is set, and it’ll be very interesting to see how successful LaLiga’s strategy is to get there.

💡 Sporting Crypto Spotlight - Ep. 4 of the Podcast!

Should sports team ownership be democratised?

Krause House thinks so.

In Episode 4 of the Sporting Crypto Podcast, I had the pleasure of being joined by Flex Chapman, Co-Founder of Krause House - who are trying to get their DAO on the cap table of an NBA team.

Watch the episode below on YouTube!

Or your podcast player of choice… if you’d prefer not to see our faces!

🍎 Find us on Apple Podcasts here [Link] ✅ or on Spotify here [Link]

More Sports & Web3 Stories

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• Karate Combat have tripled the number of unique players in their Up Only Gaming model (Read more here)

• FIM Speedway previews digital immersive experience (Read more here)

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• NFL, NFLPA Give Dapper Labs Runway to Withstand Crypto Winter (Read more here)

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• Case Study: Asics Bulds Loyalty Program With Solana Pay (Read more here)

• Startup Creator Platform Lockerverse Inks With CAA to Bolster Growth (Read more here)

General ‘Stuff’ that Could Impact You

• Superapp Grab, Stablecoin Issuer Circle to Start Web3 Wallets Trial in Singapore (Read more here)

• Stoner Cats, an NFT project who raised $8m have been fined $1m by the SEC (Read more here)

• Konami Dives into the World of Blockchain Gaming with Project Zircon (Read more here)

• PUBG Creator Krafton Unveils 'Overdare' NFT Game With AI Creation Tools (Read more here)

• Earn Alliance Launches the Biggest Web3 Game  Mint Marathon: Over 40,000 Free NFTs Featuring 16 Games from Binance, Polygon, and Immutable  (Read more here)

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