green greenroom A strategy based diet moi tan goc on personalisation; delivering valuable insights into the demographics, behaviour and interests of new fans tu lanh si ao thun tan binh on personalisation; delivering valuable insights into the demographics,dịch vụ chuyển nhà behaviour and interests of new fans ve sinh nha o behaviour and interests of new fans greenestcity/green greenroom and partner thu mua phế liệu giá cao ; chuyển nhà trọn gói ; thu mua phế liệu quang đạt
Can rights holders really afford to leave millions on the table in missed digital revenue?

/ April 14, 2021 by Greenroom Digital

Ryan Skeggs, Greenroom Digital's general manager, on how rights holders are overlooking new commercial opportunities right under their nose.

Sporting rights holders have overwhelmingly undervalued their number one asset, the fans.

Fans are the absolute heartbeat and driving force to every property no matter what tier of sport. These fans play a role in building the culture of a club and lifting the spirits of the players, and let’s not forget they are consumers. Most rights holders are doing an underwhelming job in translating this passion into profitability.

The primary source of revenue is from broadcast rights, ticketing, merchandise and sponsorship deals. However, there is a large slice of commercial pie being left on the table.

Through Greenroom Digital’s work on more than 2,000 global fan engagement digital activations, we see an opportunity for significant return on investment. Returns on digital range from 127 per cent to 324 per cent, depending on what brand sector and sports vertical we are working on. This presents opportunities not only for rights holders to merchandise their own products, but also reflects the potential value of this fanbase for their partners.

With such increases in performance possible, should the industry back itself to cross the frontiers of revenue and ask for more? More from sponsorship budgets, more from digital media budgets and more from ecommerce budgets. Should it realise its digital potential, the sports industry can be a more sustainable ecosystem and can go further than it ever has done before. By being bold, the industry can offer more hope, more pathways to success, equal opportunities, life experiences, jobs, education and overall positive change to society.

However, in order to better answer the question, we must understand disruptive macro forces which rights holders are well-positioned to take advantage of.

Of course, we have seen an economic downturn with the IMF predicting the global economy to contract by a further US$3.8 trillion in 2021. That means there is more pressure on brands to demonstrate ROI across all marketing channels. However, there are reasons for rights holders to be excited and optimistic, with money still being pumped into digital where most of their fans live. For the first time, digital will account for more than half of all global advertising expenditure, US$579 billion in 2021 according to Global Ad Spend Forecast released by Dentsu in January.

Brands have an increased focus on direct-to-consumer relationships and are utilising more sophisticated first party data strategies to achieve business objectives. This is in part due to increased consumer touchpoints and the global growth of ecommerce, a rise in smarter marketing technology and the demise of the third party data market due to restrictions on tracking.

Technology has enabled a wider and ever-growing list of products and services which can be bought online. Look at the rise of two new brands in the sport partnership world, Cazoo and Cinch, the digital native second hand car sales marketplaces.

The above point leads us into the four most common business outcomes brands now want and expect from any marketing channel:

  • Greater fan connectivity – Create new, personalised experiences for fans in their digital world to bring brands closer to them
  • ROI – New sources of value to partners and sponsors
  • Tracking – Tangible and greater measurability of engagement and conversion
  • Convenience – Make it easy for them to buy from you

What are you waiting for?

Sport has an amazing ability to create that feeling of eustress for fans. If I ask you to recall your first live sporting experience or game on TV, I guarantee you can vividly take yourself back to that memory and furthermore remember the headline sponsorship partner. Mine was Lee Dixon banging in a last-minute penalty for Arsenal to win 4-3 against Norwich City at Highbury. Headline sponsor was JVC, kit supplier Adidas. My feelings as a ten-year-old were sheer hysteria.

Sport has always been unbelievably powerful and will continue to be if we can expand the experience into the digital realm and ensure profitability. Rights holders have everything at their fingertips to harness that passion to drive greater commercial returns for themselves and their partners at the same time offering an enhanced fan experience.

From the work Greenroom has conducted over the last 12 months there are four trends that rights holders need to consider in order to reach commercial nirvana.

1. Audience

Rights holders have significantly undervalued their audiences, by only thinking about linear commercial opportunities and overlooking the true commercial value of that audience for them or their partners.
a) For example, in 2019 Manchester United had a reported one billion followers globally, mighty impressive numbers, but ‘only’ sold US$142 million worth of merchandise. That’s US$0.14 per ‘fan’.
b) Facebook has 1.6 billion users and made US$86 billion in 2020. They know how to monetise your audience for themselves as they own the ecosystem.

2. Data-rich knowledge poor

You need data, data is the new oil, data is the number one commodity, we hear and read lots of this. Rights holders have no issue acquiring data and insights, but it is worth nothing unless you know how to activate it and create new commercial opportunities from enhanced engagement.

3. Technology

Choose technology which is going to drive your desired business outcomes. Do not pick a technology vendor just because another organisation has it. They will have different resources, skill sets, budgets, and commercial models to you.

4. Diversity in mindset

Rights holders need to have a diverse and agile approach to partnerships. Brands have varying business models and are at different stages in their maturity however what we tend to see is a one size fits all approach. A smarter, flexible and more sophisticated approach will attract partners from a wider spectrum of industry sectors.

 

Look to the future as this is where we will be spending our time

There has been lots written over the last year on the bleak financial outlook facing sports globally. Rights holders have an opportunity to course correct, unlock new significant revenue and create sustainable business models which will benefit everyone involved in sport. From the five-year-old girl playing her first game of soccer to the unsung heroes at every grassroots team globally who without fail put the yards in so others can benefit. The industry owes it to them to explore the opportunities right under their nose and start taking those millions off the table to create a new, smarter, more fruitful future for everybody involved in what we all love…. SPORTS.

The Greenroom Index

Quantifying the impact partnerships deliver across key
marketing KPIs vs industry benchmarks