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Why Facebook sees sports as the next big opportunity in digital media

08 Mar 2016

Article by Matthew Bailey, Ovum analyst

Digital and social media companies such as Facebook are moving further into the world of sports as more viewer attention shifts toward digital channels and mobile-first experiences.

The Denver Broncos’ win in Super Bowl 50 in early 2016 was regarded by many as the jewel in the crown of this year’s sporting calendar in terms of audience and advertising revenues. However, new types of sports content and digital services offer the ability to expand and engage audiences on a recurring, ongoing basis.

Digital sports content is expanding revenue and engagement opportunities

Facebook’s recently launched real-time sports platform, Sports Stadium, is proof that even the biggest digital platforms have sports firmly on their radar. Live sports TV broadcasts are, and will remain, the most valuable sports media content available, but as consumers shift more of their attention to mobile-first experiences and digital and social media channels, new revenue and engagement opportunities are starting to appear.

Live sports events continue to draw engaged and attractive audiences for advertisers to target – NBC was able to charge approximately $5m for each 30-second ad spot during its Super Bowl broadcast. However, new types of digital content and services offer opportunities to engage the same audiences beyond game day.

Broadcasters such as NBC are experimenting with original digital sports-based video, distributed across a number of channels, including YouTube, Snapchat, Facebook and even Verizon’s go90 mobile video service. ESPN is pursuing a “smartphone-first content effort” in its digital operations.

Furthermore, a number of teams and sports federations are pursuing digital strategies in a bid to expand their global reach and achieve greater targeting of, and bolster their engagement with, existing fan bases.

Ovum is currently preparing an analysis of the opportunities and challenges presented by the sports digital media space. Ever more in-game, second-screen experiences are emerging and younger fans in particular are engaging with more sports-based mobile video and other content across a number of social platforms throughout the rest of the week. Advertisers looking to reach sports fans should therefore turn their attention to mobile and social platforms, where spending $5m will likely offer a much greater ROI than a one-off Super Bowl ad spot.

Article by Matthew Bailey, Ovum analyst

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