Linear vs D2C: The Future Of Sports Media & Fan Engagement - Part 2

Our sports media COO featured in this article continues to reflect on how the D2C business opportunity drives their decisions about where content is made available, how content is created and produced for different audiences, and how the “D2C Bundle” is critical to media businesses.

Access To Content

While the D2C business requires this new fan engagement bundle as described in Part 1, as a content business it is important to remain fully engaged with the various content aggregators in the industry. This COO spends a lot of time considering this point. To be a D2C business only is risky – if a consumer is not happy managing multiple apps, with their separate interfaces and payment arrangements, as well as a cross-platform content search challenge, then it is important to still be part of their content line-up when they make the personal choice to take a content package from a content aggregator. The important principle for this COO is to deliver content to the fans wherever they are and however they want it – whether that means a linear TV channel, as part of a content aggregator’s line-up, or in their own App.

From this COO’s perspective, there are a range of players positioned to be aggregators – cloud service providers, Smart TV manufacturers, incumbent pay-TV operators with broadband networks, and broadband & mobile service providers without pay-TV services. Any business with a broad relationship with consumers that facilitates aggregating content, offering a unified search function, and providing a one-stop payment gateway are positioned well.

A key consideration for D2C is the data that comes with it. One of the great advantages of establishing D2C relationships is the huge amount of information that can be gathered from audiences. When responsibly utilised – and there are many legal complexities to ensure personal information remains protected – this data allows media platforms to better serve their users, make smarter choices on content acquisitions, and much more.

Ultimately - when it comes to B2B versus D2C - it is currently unclear which model will win out for most media businesses. Big global brands like Disney will be able to aggressively pursue a D2C strategy because they have such strong brands and their content travels well internationally. They can more easily attract viewers and subscribers to their proposition because it is so recognisable. Other large players like Netflix and Amazon have a similar ability to operate on a global basis.

Sports is different, primarily due to the nature of sports rights and the more localised/national nature of interest in the content. It is also the case that sports are mostly watched live, which is a different dynamic compared to VOD viewership. What this does is create a natural partnership rationale for sports media businesses and broadband service providers to, together, deliver an excellent fan experience. Broadband providers could operate as aggregators of sports content or at least do commercial deals that help this live content reach audiences at the highest possible quality and lowest latency, which is particularly important for live content and audience satisfaction. It doesn’t mean that Telcos would buy sports rights themselves. This has happened and will still happen of course where Telcos want to participate in this type of business, but recent experiences indicate that there are more entertainment-centric businesses that are willing to invest heavily in sports content with the aim to monetise the content in ways that are more natural to them as media and entertainment companies. But as a minimum, the nature of D2C sports streaming could mean that Telcos continue to participate heavily in the successful delivery of live sports because of their vested interest in winning broadband and mobile customers.

Attracting Different Viewers

This COO is acutely aware that making sport attractive to a younger generation requires some changes to the traditional linear TV production and delivery methods. While older sports fans are generally happy to watch the full game or match on a big screen, the younger viewer is more “social media native” and, partly because of this, is more likely to value short form content. In fact, it could prove that to the younger generation the 10-second, 30-second and 60-second clips are the most important aspect of following their sport. Or perhaps a more immersive experience within a community of fans will be more attractive. Other theories are that younger language should be used in production for maximum appeal. It is easy to over-generalise – live sports still have a massive pull for fans of all ages - so the important point is to measure and prove the popularity of different formats with different audiences.

Another important idea for driving engagement is to use different monetization methods for each type of content delivery. Sponsor-supported, in-game purchases, and in-game betting could all be layered in differently depending on the viewer. But there is a recognition of the danger of ‘innovating’ the fan experience for its own sake. This COO stresses that the key is to introduce services that add real, tangible value to fans’ viewing experience.

A Content-powered Fan Experience Universe

With the D2C streaming model, sports media companies now have the opportunity to become Fan Experience Universes. Not many media companies have this opportunity – sports content is different from mainstream entertainment content because the level of engagement, emotion and passion is generally much higher. For this reason, in media businesses that have a range of content the customers are often called viewers. In a sports media business, they are called fans. With fans, the impulse to engage in subjects outside of the content itself is, by definition, higher.

It is therefore vital to focus on creating engaging experiences on multiple levels with fans. The media business does not need to replicate existing functionality and fan environments that exist elsewhere. What is most important is to create the opportunity for the fan to engage in that experience from inside the sports media business’s platform. And while consuming the sports content itself, the opportunity to engage is at its peak.

So, will a D2C streamer change its own self-definition to become a fan experience business? This COO thinks yes and no. No, because at the core of the value proposition must remain the sport itself and this is all about content production and delivery. Yes, because the importance of the peripheral elements that enhance the content is growing all the time.

Finally, it is time to reveal our COO, Alessandro Tucci of the ELEVEN Group which is often mentioned alongside the likes of DAZN and other sports media businesses with streaming at their core. So how does Alessandro summarise where the industry has been and how D2C changes things?

“The traditional media companies have content as King. Content is created and distributed via channel packagers and that’s been it basically. For the channel packager – the job has been to build a strong channel brand (“the Castle”) around the content offering. So the brand becomes synonymous with great content and is no longer reliant on any one programme. Viewers’ allegiances are with the brand, not any one show.

“The growing D2C model brings everything together in one place, with the fan at the centre of things. Content and brand are still key, but D2C also comes with many more ways to engage with the user and earn their time. So it is no longer a one directional service – the relationship between media platform and user becomes much more interactive and engaged. The D2C model also changes the P&L model. It brings together the revenues and costs (marketing, etc.) in one place and places more responsibility on the media platform to do it all. So, more risk, but big opportunities too.”

And how does Alessandro summarise the work ELEVEN is doing to build a sports media platform fit for the future?

“Ultimately ELEVEN is about connecting fans with the sport they love wherever and whenever they want it. By offering fans a ‘one stop shop’ for sport, we build deeper relationships with them and earn more of their time.

“While D2C is key to our business we don’t want to be limited by that. We want to make great sport content available to fans across all platforms in the most accessible ways and that means partnering with all players in the market to distribute our content to everyone. This ‘platform agnostic’ approach has been a cornerstone of our business since we launched in 2015.

“Live sport is the central hub of our offering – we deliver over 65,000 hours of live sport a season - but we also work to enhance it with top social content and long form programming. In NEO Studios, we are fortunate to have a fantastic studio arm that creates award winning sports documentaries and other content for ELEVEN and also third-party platforms.

“More than our content, we want to give fans a brilliant home to engage in their passion for sport. We are developing new services to engage fans in a deeper way all the time – whether that’s via ecommerce, or betting, or NFTs. Or by introducing new features on our D2C platform to enhance the live experience – like the Watch Together tool we launched a couple of seasons ago – which allows fans to follow games together from a virtual ‘living room’ and share the emotions of a game together.

“Building this deeper relationship with fans powers our core distribution business and also opens up interesting opportunities to service our rights holder and brand partners. Through our marketing arm Team Whistle, we can help our partners capitalise on the highly engaged audience we have built and communicate with fans in a really impactful way.”

The Final Whistle

The ultimate commercial goal of a D2C streaming business is to win more of their customer’s time. We all know that each person has a finite amount of time for entertainment, and in the media industry we are all competing for that time with each other and with other forms of entertainment like social media, reading, outdoor activities, sports, music, concerts, etc.

For our featured COO in this article, the overarching point is that once you can connect with a fan through live sport, the key is to offer more and more experiences that keep them on your platform, to entertain, inform, educate, and be as big a part as possible of their spending behaviour. At the final whistle, this is how success will be measured.

With contributions from Alessandro Tucci, Eleven Group COO.

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