impact sponsorship live sport ott social media

The Impact on Sponsorship of Live Sport Gaining Traction on OTT and Social Media

November 15th, 2017 Posted by No Comment yet

The emergence of OTT platforms and the entry of social media streaming for live sport is an exciting technological evolution for sporting teams, governing bodies, fans, spectators and most importantly for me … because it impacts sponsorship!

This evolution brings forth not just the opportunity but the actual need to operate a sponsorship model which is organised, sophisticated and uses a mixture of proven and future driven methodologies to administer sponsorship programs.

Trend five in Nielsen Sports’ Commercial Trends in Sport 2017 looks at ‘Live Sport Gaining Traction on OTT and Social Media’ and highlights some key trends and opportunities which have, or will, emerge as a result. The most impactful from a sponsorship perspective being ‘The rights model will be reshaped as revenues grow around new direct distribution models’.

What does this mean for current broadcast arrangements?

It has long been my personal opinion, particularly in smaller markets like Australia, where I live, that the age of massive broadcast deals growing exponentially is over. I would not at all be surprised if the current or next deals struck in premier sports are the tip of the iceberg with all others beginning to trend downwards.

Why is this so?

For me, its down to a few factors including:

  1. the way sports are consumed has now changed;
  2. technology allows fans to only watch the content that they are specifically interested in; and therefore
  3. audiences are engaged in multiple layers of broadcast which results in lower realisation levels of commercial measures which underpin broadcast fees.

How will this change sponsorship?

Some of these platforms will work with broadcasters and league owners to deliver the content and some will be owned and delivered by the rights owner only.

You can see in the diagram that the question is asked, will the ownership and delivery model of sports in the USA literally flip on its head?

If the answer is ‘Yes’, the engagement of audiences direct with rights owners will evolve at a rapid pace. Further, for those selling and delivering sponsorships, the opportunities to engage new audiences in a regular and more spread-out fashion, rather than just during a match or event, is super exciting.

Sponsorship won’t just be sold for match-day execution. There will be insights, highlights, behind the scenes, live coverage, pre and post-match … I could go on and on. All of those examples deliver their own sponsorship rights that can be sold and tailored to specific and different audience segments.

What new tools will this bring to sponsorship?

The insights that will be able to be gained from owning these platforms is immense.

There are already tools (such as Shareablee) which can tell us sentiment, alignment and realisation of brands and rights owners together by actually measuring who is consuming what, when and how. Who is paying to consume what, when they consume it and how they consume it, opens up data insights which can quickly turn into commercial revenue when used correctly. The reason is that the insights are able to take sponsors directly to known consumers which directly align with a brand’s target audience.

How can sponsorship professionals be ahead of the game?

As per previous blogs and podcasts in this series, there are things rights owners can do in order to be prepared to take advantage of the changing landscape. These include:

  1. Start to delve now: Without breaching any broadcast agreement, generating your own content channels and opportunities to engage your audiences with your sponsors will immediately ready you for better execution when the offerings are widely available.
  2. Evolve and assess your rights: Take the chance to understand the rights you currently sell, how you currently sell them, which ones are growing in consumer engagement, which ones are dipping and, most importantly, which ones you inherently ‘give away’ through larger broadcast deals.
  3. Find the Tools: The evolution of this trend will bring so many opportunities, however, be warned – the pain to deliver, measure and administer will far outweigh the benefits if the tools aren’t in place from the outset. By that I mean you will need systems, services, and people to help to manage, measure, deliver and report on all this new and existing partnership inventory.

How does this rate in terms of opportunity?

Of all the Commercial Trends in Sport 2017, this one has my mind spinning the most. Whilst short-term pain may be felt, with the lack of guaranteed revenues from centralised broadcast deals, those who get this right will have endless commercial upside.

Can you imagine how attractive rights owners will be to a sponsor when they can show exactly who is consuming what, when, and how and can also give even semi-accurate predictions around the consumer interest in, and sentiment of, a product or service being offered?

The ability for rights owners and brands to work together in this space gets me so excited that I can’t even describe it.

The world is our oyster!

DOWNLOAD – Commercial Trends in Sport 2017 by Nielsen Sports

Mark Thompson - SponServe

Mark Thompson // Managing Director

Mark specialises in sponsorship and diversified income strategies and has used this expertise across the Community, Semi-Professional and Professional Sports sectors. He combines hands-on experience in managing the expectations and obligations of sponsors with marketing and stakeholder engagement to deliver outstanding results.

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