football

The march of the tech titans on live sport

August 21, 2018 14:14 Comments Off

Facebook, Amazon, Google, Twitter and others are leveraging the power of live sports to help them grow.

People are watching sport online

The FIFA World Cup earlier this summer and other major sporting events have confirmed what everyone has long suspected: that an increasing number of fans are streaming matches online instead of watching them the more traditional way, on television. This is very good news for tech companies such as Amazon, Twitter, Google and Facebook who are looking to leverage the passion of live sport viewers and its appointment-to-view nature as a way of reaching new users and increasing ROI on existing ones.

Facebook has been looking for ways to super charge its growth

Facebook in particular has upped its live sports game, aggressively pursuing the rights to air football and other sports across the world. At the end of June, the social network announced disappointing results for the second quarter: this was in part down to issues surrounding GDPR in Europe and the Cambridge Analytica scandal, but also, ironically, due to Facebook’s huge success – it has reached near-saturation point in mature markets in North America and Europe. Its future growth strategy therefore relies on two things: increasing revenue on each existing user in these mature markets, and attracting more users in countries where Facebook is less ubiquitous, particularly Asia and Latin America.

The answer: live football

The latter part of the strategy is already well underway, with live sports playing a key role – this was evident when they hired Eurosports CEO Peter Hutton to lead the push. Last week, it was announced that La Liga had signed an exclusive three-year deal with Facebook to live stream all its 380 matches for free to Facebook users in India, Pakistan, Bangladesh, Sri Lanka, Afghanistan, Bhutan, Nepal and the Maldives. The platform has 348 million users across these markets, with 270 million of those in India. India is a key growth market for Facebook: it already has the largest Facebook user base in the world (270 million versus the US’s 210 million) but, with a population of around 1.3 billion and a projected 500 million internet users by the end of this year, there is huge room for growth for Facebook. Increasing smartphone penetration, relatively affordable mobile data and a passionate football fanbase means that the La Liga deal is a smart move from the platform. This move is in addition to Facebook’s plans to roll out its video platform, Watch, into India – it’s currently only available in the US.

La Liga isn’t Facebook’s only move into live football streaming: just a few days after the La Liga announcement, UEFA confirmed that Facebook had bought the media rights for certain Champions League live matches in Spanish-speaking Latin America for the

2018-2021 cycle. The matches they have the rights to include the final and Super Cup games, and the number of top international players involved in the tournament means that it is a huge deal across the continent.

Other tech companies are also snapping up live sports rights

Facebook’s activities in the live sports space are matched by its competitors’: Amazon in particular has been signing deals to attract more customers to its Prime platform, including a five-year deal for the exclusive broadcast rights of the US Open tennis tournament in the UK, the rights to screen 20 Premier League football games each season, also in the UK, from 2019 to 2022 and streaming rights for Thursday night NFL games in the US. Meanwhile, Twitter works closely with the NBA, partnering with them to help people keep up with the latest news and developments and watch the games, no matter where they are. YouTube has the rights to Major League Soccer games, including the Seattle Sounders and Los Angeles FC, for which it has both streaming and broadcast rights.

The future of live sport and entertainment looks dramatically different

There are concerns amongst consumers, particularly in India, that slow broadband speeds will affect their enjoyment of games, and that it will take something away from the camaraderie of watching games as a group on television. This is perhaps mitigated somewhat by the fact that the games will be free to view. From an industry perspective the arrival of tech platforms on the live sports scene is a seismic shift. For advertisers, concern about TV live sports strategies being adversely affected will surely be offset by the huge opportunities presented by delivering targeted ads to passionate sports fans in real-time. For the major players in broadcasting space, it is the fear of the existential threat that this precise situation causes that has led them to rethink and overhaul how they operate; this has led to some of the huge mergers we have seen recently, including the AT&T takeover of Time Warner and Disney’s deal to purchase 21st century Fox’s film and television assets, which was recently approved by shareholders.

There can be no denying that the media and technology industries are converging at breath-taking speed, and that the landscape will look very different, very soon. Agility and a willingness to innovate and take calculated risks will be the ways to succeed as this transformation takes place.

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Media audits: the big four or specialists?

July 11, 2018 13:03 Comments Off

In an increasingly complex media landscape, media audits are becoming ever more important; should advertisers choose one of the ‘big four’ firms or a smaller media specialist to carry out their audits?

The media audit – understanding efficiency and transparency in media activity

In an increasingly digital and competitive world, where brands are concerned about transparency and about the effectiveness of every single dollar invested in advertising, the media audit is a very important tool in the CMO’s toolbox. Not only does it help advertisers to ensure that their agency partner(s) are delivering on their marketing and business objectives in the most efficient and transparent way possible, but it also enables them to identify errors and troubleshoot effectively: particularly crucial in an age of automated buying.

Choosing a media auditor

Once an advertiser has decided that they are going to carry out a media audit with their media agency partner or partners and established the KPIs of the audit, the next step is to select the auditor themselves. The options here are not myriad – this is not a huge industry – but they can be more or less divided into two camps – big generalists, or smaller specialists. The former, comprising the ‘big four’ audit firms – KPMG, EY, PwC and Deloitte – carry out audits across many industries for blue chip clients across the world, and are often chosen by clients for their undoubted auditing and accountancy experience, or because they have successfully audited another part of the company. The other camp comprises the smaller specialists, among whom we at ECI count ourselves. While these specialists do not boast the vast scale of the Big Four, there is huge value in having media specialists audit media activity.

The big four versus the specialists

In 2016, Sir Martin Sorrell urged advertisers to choose one of the Big Four to carry out their media audit, largely because they are chartered accountancy firms and are therefore subject to regulation. Sorrell said that he was concerned about giving specialist media auditors access to his group’s privileged information, given that they ‘lack professional rules and regulations’. This is a view

commonly held by media agencies, an unkind interpretation of which is that they are nervous of having their activity audited by media specialists – some of whom may have even worked agency-side and know which stones to turn. In any case, we are convinced that, in an industry renowned for complexity that increases by the day, it can only be to an advertiser’s advantage to have experienced media practitioners examining and analysing agency practices – because they do indeed know what they are looking for.

Impartiality issues

In the wider business world, the big four are having to answer big questions about their work, having been involved in the auditing of failing or failed businesses such as Carillion in the UK, which went into liquidation earlier this year. Their impartiality has also on many occasions been called into question; PwC and Deloitte’s creative offerings (PwC Digital Services and Deloitte Digital respectively) are among the largest creative agencies in the world, putting them directly into competition with the holding companies that own the very agencies they are being hired to audit. Meanwhile, Accenture – not one of the Big Four but similar in offering and scale – has recently launched its programmatic offering, negating, in our view, impartiality for its audit function: this is indicative of a wider industry trend.

In the end, the choice is of course up to the advertiser themselves, who should make their decision based on their specific needs and preferences. The key is to ensure you study the media agency contract carefully and agree on the scope of the audit with both the agency and the chosen auditor. Ultimately, it is about ensuring that every media dollar is used as effectively and efficiently as possible in order to drive higher media value.

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The Digital World Cup

June 26, 2018 00:20 Comments Off

There are few events that unite audiences like the FIFA World Cup. The passion, excitement and anguish evoked by the beautiful game crescendos for one month every four years, and this year fans from Poland to Peru and Saudi Arabia to Senegal have turned their attention to Russia, pinning their hopes on their national team and praying that this will be their year: the fans of all but one country will have those dreams dashed. Even Americans, whose national team failed to qualify and who are traditionally less interested in soccer, are still gripped by the drama that unfolds daily.

Sports audiences are turning their attention towards digital channels

Of course, such focus and emotion makes the World Cup fertile ground for brands who are looking to coherently engage a global audience. Once, TV was the obvious choice of channel for these brands, who would plough millions upon millions of dollars into sponsorship, premium TV spots and experiential activity. However, the increased adoption of digital and social media in recent years has forced advertisers to take a step back and consider how to best to reach those who have migrated away from TV: while 62% of the 3.2bn-strong audience still plan to watch the games on TV, 30% will stream them online – a figure that increases in developing countries and likely in countries with a dramatic time difference to Russia. Over half of the TV viewers will use social media while they are watching. Some had feared that the all-important millennials were drifting away from sport in general but, as this McKinsey study found, they are in fact simply fragmenting their viewing habits, streaming games and using social media to check highlights, scores and news. This is backed up by a Google study which shows that there has been a 90% increase in searches for highlights videos in the last year. This is compounded by the fact that many social platforms are becoming increasingly video-heavy – see Instagram’s recent announcement that it will allow users to post videos of up to 60 minutes.

TV is losing broadcasting rights as well as audiences to tech giants

All this is happening against a backdrop of an equally seismic shift in the live sports landscape: the buying up of broadcast rights for sporting events by non-traditional entities such as telco companies and even tech giants such as Amazon, is having a profound effect on traditional broadcasters and, by extension, on advertisers. Not only do the broadcasters lose viewership during the sporting events, but also afterwards as they lose the opportunity to market for future programming to the large sporting audience: smaller viewership means fewer eyeballs on ads. At the same time, the new players like Amazon finance the purchase of their rights through means other than ads, for example subscription fees, thereby removing a huge message distribution opportunity for advertisers. This means that the pricing of what remains increases, particularly around high-value programming.

So, what does this all mean for marketers who might previously have relied on international sporting events like the World Cup and the Olympic Games to reach the often elusive younger male audience, as well as the others who only engage with sport every few years?

Advertisers must respond by adapting and innovating

The answer is, as so often, to follow the consumer and to innovate. It goes without saying that advertisers need to look at allocating a large proportion of their budget to digital channels; however, they should also be looking for ways to enhance the enjoyment of the event for consumers and give them what they want by creating exciting new products for added value. We know that millennials have short attention spans thanks to the huge range of options available to them, so products such as fun contests, easily shareable gossip and opinions and ‘whip-around’ highlights could be great ways to engage with them and hold their attention.

Sporting influencers are a huge opportunity

Sport by its very nature creates influencers with huge followings: Portugal’s Cristiano Ronaldo drove 570m social engagements between January and May this year, while Neymar drove nearly 300m (both figures from Nielsen). Savvy brands are capitalising on these figures: McDonald’s in Brazil incorporated Neymar and his Twitter activity into their #prepara World Cup campaign, while Vodafone has not only featured Egyptian Mohamed Salah in their World Cup activity, but harnessed his social following as well. Visa’s global campaign features six influencers, most notably Sweden’s Zlatan Ibrahimović and makes the most of his innate charm and popularity.

TV is still important – but it no longer monopolises audiences

TV is by no means dead and still commands the lion’s share of audiences for live sporting events, including for major ones such as the World Cup and the Olympics. However, advertisers need to be mindful that the trend of audience migration to more digital viewing behaviour shows no sign of abating, and should respond accordingly.

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