Are Shoppable Experiences the Future of Sports Monetization?
Updated: Dec 22, 2022
Rory Renwick, Sales and Business Development Director, Accedo. Sept 2022
Sports federations, clubs, and broadcasters have been under increasing pressure to keep both fans and sponsors happy and engaged. The sports industry has of course been particularly hard hit over the past couple of years but even before covid, many were facing dwindling viewer numbers and a hit to revenue. Sports providers need new ways to engage fans and they also need to shake up the value they bring to advertisers and sponsors to keep them on board while delivering new revenue streams. Could shoppable experiences be the answer?
User behavior is changing
Sports viewers have been steadily moving away from traditional sports broadcast channels towards a pure streaming world. In fact a recent report from Grabyo shows that 45% sports fans globally are currently exclusively paying for streaming services. The same study says that by 2026 sports fans will make up only a 28% customer share of the global broadcast TV market. With nearly 80 per cent of global sports fans prepared to switch to streaming services for live events, it is clear that the way in which sports is being consumed has drastically changed over recent years.
Perhaps even more worrying for sports organisations is that the younger generation seems to be moving away from sports all together. A recent study by Morning Consult suggests that only 53% of Gen Zers identify as sports fans, compared to 63% of all adults and 69% of millennials. The Gen Z generation are much less likely to watch live sports, with them twice as likely as millennials to say they never watch live sports.
At the same time however, as sports move towards more to streaming platforms, there is a huge potential for clubs, federations, and broadcasters to find new ways to engage with sports fans, creating a compelling digital offering that also taps into the younger generation’s use of social media and second screen interaction and interest in personalities. Sports offerings need to go beyond just sports to remain relevant for both viewers and sponsors in this changing consumer landscape.
Evolving shopping habits
Shopping habits are also changing, and video is increasingly playing an important role in buying decisions. According to a recent survey from finder.com, 79% of people say that a video ad has convinced them to buy a product. Meanwhile 88.6% of Americans have reportedly succumbed to the temptations of impulse shopping. Many consumers do a large portion of their shopping online, with Americans spending an average of 65 hours per year shopping online. This shift to online shopping represents an opportunity that sports brands can tap into. Especially when you consider that 35% of TV audiences use a second device to shop or consult a product or service while watching.
What if that could be even more paired to the content on the TV, making the process of buying a product in the video very quick for viewers?
The Opportunity for Sports
There is a need to solve two main challenges for sports rights holders:
How do we increase revenues knowing the media rights revenues and costs are fairly steady?
How can we create new engagements for current and future audiences?
The result will be a digital solution that enables sports bodies and broadcasters to experiment with an in-video shopping experience and drive conversion towards advertisers’ products. This of course means better value for advertisers leading to more revenue for the sports organizations. It also means that sports rights holders can create a new space to interact with their fans and give them some of that “in stadium” interaction by bringing sponsors and merchandising to the fans’ home.
We also realized that customers are looking for solutions with minimal manual labelling and machine learning expertise, hence, we integrated our solution with an ML-driven backend system that recognizes relevant objects (digital goods, logos, etc), and pre-filters video frames to surface shoppable metadata enabling fans to interact with them in just a few clicks.
It is also important that this can all be done without disrupting the video experience for the fans. We have two methods for doing that, both of which use a second screen device.
In the first method, the main screen is used to attract the user’s attention with products displayed alongside the main video that are associated to the content being watched. Users can look at details for a specific product without stopping the video. When it comes to purchase, a QR will be displayed on the screen and they can use a mobile device to complete the purchase.
In the second version, the main screen is again used to attract user’s attention. Meanwhile, a standalone app on a second screen device knows the content being watched by the fan and loads associated products on that device.
For viewers watching the main content on a mobile or tablet device, we can deliver same screen shopping experiences that keep the video running while they shop.
For sports organizations, this solution will help them to build a new platform to attract sponsors and advertisers. It will also represent a streamlined distribution channel for their merchandising and ticketing, where they will have full control over the entire experience – from consideration to conversion.
This article 1st appeared on Accedo's Blog HERE