Wednesday, February 11, 2015

Pick 6: Brands, Stories, and Trends Shaping Sports Business #23

It's the pre-Valentine's Day edition. Yes, that's this week. Don't worry, you still have plenty of time to shop as the special day is nearly three days away- procrastinators unite! In the spirit of Valentine's Day, let's take a look at six articles about relationships.

1. Caddies Aren't Interested in Spreading Sponsorship Love

It seems that sponsorship has permeated sports in nearly every possible way. It is part of the landscape to see professional golfers wearing caps, visors, and shirts adorned with patches of their corporate sponsors. Players are handsomely compensated for this providing brand exposure. The same cannot be said for their caddies, including a group of 80 caddies that have filed a $50 million lawsuit against the PGA Tour. Their complaint is that they are forced to wear bibs with sponsor logos without receiving any compensation. The PGA Tour has threatened to not allow caddies to participate in events unless they wear the bibs.

Should caddies be forced to become human billboards even if they do not want to? Does the PGA Tour policy violate caddies' rights; what if a caddie is told to wear a bib with the logo of a company that it does not like or prefers the sponsor's competitor? How could the situation be used to sponsors' and caddies' advantage rather than coercing caddies to participate?

2. Adidas Aims to Change Game for Buying Limited Edition Sneakers

You have probably heard stories about buyers standing in line for hours for a chance to buy the latest in-demand sneakers (or have been in those lines yourself). Although there is a ritualistic quality to this practice, it is safe to say that the experience for buying a high demand product could be improved. Adidas has set out to do just that by developing a mobile app that lets users pre-order limited edition products, giving them first crack at the latest styles. Adidas says the app can streamline the customer experience, better matching demand with inventory. Are there other products in the sports industry that would benefit from adopting a mobile pre-ordering system like the one Adidas is developing?

3. Online Viewers of Sports Video See More Ads... and Advertisers Know It

Research from Adobe hailed 2014 as the most digital sports watching  year yet. The rise of the mobile consumer included greater consumption of sport-related video online. Research found consumers viewed an average of 4.2 authenticated sport videos in 2014 versus 3.8 per month in 2013. Perhaps the statistic that draws the most interest is that viewers of sport videos see 66% more ads per video than viewers of non-sport content. 

If you are viewing sport videos, this statistic suggests you are highly engaged with the content and may perceive a context match between content and commercialism. Does it also mean you are likely to see more advertising given your inclination to view ads when consuming sport video? Ad sellers and advertisers have a history of not being able to curb their enthusiasm when encountering engaged audiences. We should monitor advertising in sport-related videos during 2015 to see if more ads creep into this channel.

Sport Viewership Goes Digital, by Adobe Digital Index, Ad Age

4. A Social Alternative to Super Bowl Advertising

Advertisers spent $4.5 million for 30 seconds of exposure during the recent Super Bowl. While the enormous reach of the TV broadcast and the buzz around Super Bowl and its commercials seems to justify a $4.5 million spend, there is evidence that brands that were not Super Bowl advertisers scored without making the multi-million dollar investment. Research from Mediavest USA/SMG found that in some cases non-advertisers with an active social media presence around and during the Super Bowl had higher engagement than competitors that were Super Bowl advertisers. 

The Super Bowl consumption experience is no longer confined to the game itself and TV broadcast. It occurs on multiple channels for days before the game, during the Super Bowl itself, and after the game. Advertising in-game gives brands a spot on the big stage, but social media interaction around fans' interest in the game seems to trump the few seconds of glory an advertiser enjoys.

5. PGA Tour Turns to Online Network to Connect with Young Fans

Like many sports, professional golf has challenges in appealing to Millennials. One of the issues facing sport properties is the time investment one must make to take in a sporting event. Another issue is simply creating compelling content that keeps the audience interested. The PGA Tour is addressing these challenges by launching an online network, Skratch TV. Among the features of Skratch TV content is short videos rather than the lengthy format associated with network TV golf telecasts and innovations in capturing the action by using GoPro cameras and cameras mounted on drones. Research shows that the percentage of Millennials making up the TV viewing audience for the PGA Tour (20.2%) is smaller than for MLB, NASCAR, NBA, and NFL. Clearly, golf needs to attract younger fans. Skratch TV could be a significant step in that direction.

To Lure Younger Fans, PGA Tour Will Offer a Network Online, by Richard Sandomir, The New York Times

6. Twitter Group DM Offers Access that Fans Crave

A recent innovation to Twitter's service is the availability of private group messaging. Not only does the ability to hold group discussions privately add efficiency to the Twitter user experience, it opens doors for marketers to explore how to connect with customers in a way that gives them some type of special access. Adidas was perhaps the first sports brand to experiment with private group messaging, connecting Real Madrid star Karim Benzema with three randomly selected fans. 

One of the greatest benefits a sports brand possesses is the ability to give fans inside access to something for which they hold great affinity. Most Walmart customers likely would not get too excited about a private messaging session with the company's CMO, but if fans of a sports team are able to participate in a session with coach, player, or other member of the organization it could create a memorable experience that deepens the bond between fan and brand. It will be interesting to watch how other sports brands utilize this new Twitter feature.