Trends by Havas Sports & Entertainment

OUR ANNUAL LOOK AT WHATâ&#x20AC;&#x2122;S ON THE HORIZON

FOR

SPORTS MARKETING TRENDS

TABLE OF

CONTENTS

SPORTS FOR THE SHARING GENERATION

ESPORTS

DATA & TECHNOLOGY

NEW MEDIA

DO THE RIGHT THING

THE POWER OF PASSION PEDRO AVERY

GLOBAL CEO

H AVA S S P O R T S & E N T E R TA I N M E N T 4

Is there a more powerful human driver than passion? When we are passionate we put greater energy and determination into something. We stop at nothing to achieve our goals. It is this compelling, superhuman force that marketers are eager to tap into, to propel their latest brand engagement strategies. As digital marketing enters its teenage years, it’s clear that consumers enjoy their social fix. They demand content to share with their mates (according to Pew Research the average Facebook user has 300+ friends...). It is this content that will fuel the next generation of brands looking to create meaningful experiences that our digital hungry consumers demand.

We also believe in the need for innovation – to look forward, stay a step ahead, and be part of the changes in our industry. This year we have decided to focus on the trends coming our way in sports in 2017. From the not-so-niche eSports, to machine learning, live streaming, startups, women and integrity, we have covered a broad spectrum to bring you the key trends we believe will fuel the debate next year. Our trends are designed to tickle your appetite, and hopefully encourage you to take the bold step and embrace passions as part of your marketing mix. Enjoy!

When compelling content is coupled with a passion it ignites magic. Brands who have embraced this have raced ahead of their peers. Passion based marketing is here for good. That’s why we at Havas Sports & Entertainment believe in the power of passions. It’s simply the best tool to connect with people, not as consumers but as fans.

5 ©Havas SE USA

SPORTS FOR

THE SHARING GENERATION

FOREWORD MIKEY HERSOM

PRESIDENT

H AVA S S P O R T S & E N T E R TA I N M E N T U S A

@mikeyhersom 8

/ SPORTS FOR THE SHARING GENERATION

It’s never been better to be a sports fan. Thanks to social media, you can cheer your team on, engage with athletes, see highlights, check stats, watch the action live, all while conversing with your friends and other fans on one single platform. It’s never been easier to take part in the sports story, and share your POV. The stats speak for themselves, particularly if we look at this summer’s biggest sporting event: the Olympics. Over 187m tweets were sent about #RIO2016 generating 75bn impressions; over 227m people had over 1.5bn interactions around the Games on Facebook; and in the first week alone, over 50m people, one in three daily users, watched Olympics clips on Snapchat in Live Stories. In this age of the "sharing generation" where eyeballs are divided amongst screens, sports properties and

their partners need to understand their younger audiences and their media behaviour, to ensure their content and how it is accessed allows fans the opportunity to discover and make that content their own. We are proud to have helped Coca-Cola, the oldest Olympic partner, bring the Olympic #ThatsGold campaign to teens in Rio through a dedicated space and event programme just for them – through a series of concerts with MTV and Facebook Live, shareable activities like #JustDance competitions and photo opportunities with the Olympic Torch. The Olympics remains a source of inspiration for new generations of sport fans. The International Olympic Committee (IOC), their partners, broadcasters, marketers and the rest just need to understand where and how to engage them!

GETTING MILLENNIALS INTO THE GAMES

CATHERINE INKSTER

M A N AG I N G PA R T N E R SEVEN46

@Inkster_sport 10

/ SPORTS FOR THE SHARING GENERATION

The next Summer Olympic cycle will see a significant shift in the way people consume Olympic-related content as the International Olympic Committee (IOC) and its partners seek to win over the coveted 12-34 demographic. Millennials’ declining interest in the Games sparked headlines in 2016, when the age of the average US viewer rose to a record 52.4 as a storm raged over the IOC’s ban on Olympic-related GIFs, the format so beloved of the sharing, co-creating generation. In truth, GIFs alone are unlikely to reverse a 20-year trend mirrored in the audiences of most major sports properties and rooted in a fragmenting global culture that simply offers young people more options.

are starting to rethink the way they package sports content for a millennial audience, navigating the shift away from one-way storytelling and towards a more dynamic, bottom-up approach. This could be seen in the proliferation of influencer marketing around Rio 2016 and in NBC’s unique Snapchat and Twitter distribution partnerships. And the strongest indication came after the Games with the launch of the IOC’s own multi-platform content solution, The Olympic Channel, a major initiative part-funded by global Olympic brand partners. THE REAL KEY TO ENGAGING MILLENNIALS IS TO OFFER MORE, AND MORE INDIVIDUALISED WAYS TO PARTICIPATE ACTIVELY IN THE OLYMPIC STORY

But the story goes to the heart of the problem facing the Olympic Movement: exclusive long-term TV rights deals that account for three quarters of the IOC’s revenues at a time when young people everywhere are switching off from traditional scheduled TV in favour of an always-on, multi-channel digital ecosystem – a place where they can be active participants and not simply spectators.

Its mission is to sustain and grow a millennial audience between Olympic Games through live (including hyper-local) sports feeds and original real-time content pushed out across social media platforms and in highly shareable formats.

This is a generation whose instinct is not just to consume but to discover, create, edit, interpret and share. Who don’t just want to be shown content, but to be given content to own and play with. At last, rights holders and their partners

The Channel also offers third-party integration. For example, users can download the Spotify training playlists of their favourite athletes or track and share their own training data via a partner health app. 11

The real key to engaging millennials is to offer more, and more individualised ways to participate actively in the Olympic story – not just during the two weeks of the Games, but 24/7/365. From VR to GIFS, edits, data visualisations and community hang-outs and events, Olympic partners should get ready to take advantage of a much wider window for engagement – and a deeper and more varied terrain for connecting with young people through the Games. Given everything we know about millennials, it’s clear that the values, authenticity and global, social purpose of Olympism offer a natural vehicle for engagement. They just need the tools to get involved.

THE BIG TAKEOUT In response to millennials’ declining interest in the Games, rights holders and their partners are rethinking how to package sports content, offering more and more individualised ways for this audience to participate actively in the Olympic story. The Olympic Channel, with its live sports feeds and real-time highly shareable content, is a step in the right direction.

/ SPORTS FOR THE SHARING GENERATION

HOW SOCIAL MEDIA IS CHANGING THE GAME

STACY FULLER

HEAD OF CONTENT H AVA S S P O R T S & E N T E R TA I N M E N T U S A

@stacykfuller 14

/ SPORTS FOR THE SHARING GENERATION

Sports fandom has always been an enormous passion that unites people all over the world, and thanks to social media that connection is stronger than ever. Platforms are shaping the way fans interact with each other, how they engage with their teams, and even how athletes behave after the buzzer. Here are a few examples of just how big an impact that tweet has on your team. VIDEO IS ANTICIPATED TO ACCOUNT FOR 82% OF ALL INTERNET TRAFFIC BY 2020

1. Same game, different screen Fans are still gathering together around screens to watch their favourite teams. But now that screen is in the palm of your hand instead of in your living room, and the game analysis isn’t just between your buddies but might include fans on the other side of the country or even the world. For example, although the partnership with Twitter and the NFL to stream Thursday night games has been slow to gain ratings, video is anticipated to account for 82% of all internet traffic by 2020. As viewing habits continue to evolve, Twitter is well positioned to capture both the attention and the real time conversation of fans.

2. Watch less but know more Facebook, in contrast, has embraced the fact that fans want to follow their favourite teams without having to be glued to a screen to participate. With the launch of Facebook Sports Stadium, fans can follow real time scores, get live stats, see what their friends are saying, and even ingest commentary from journalists, leagues and teams. 3. Play the game < Play the social media game Like many celebrities in recent years, athletes have started to develop their own brand presence on social media platforms. But this year we’ve seen athletes get into the tech game themselves, the biggest being LeBron James’ Uninterrupted and Steph Curry’s Slyce. Both are trying to help athletes create better content and deeper engagement with fans. 4. More than a game Social media has amplified all the pageantry that happens around sporting events, making it more accessible for casual fans and allowing more participation. No better example of this is what happened during this year’s World Series with the Chicago Cubs. Super fan and actor Bill Murray was avidly followed online as he invited fans to sit with him, then he sang ‘Go Cubs Go’ on Saturday Night Live, a popular US late15

night comedy show. There was even a live stream showing the outside of Wrigley Field where fans had gathered; folks just wanted to see the reaction of the local crowd. Content is expanding to cover the entire sporting experience, and this provides brands that have and havenâ&#x20AC;&#x2122;t traditionally been involved in sports massive opportunities to connect with larger audiences. 5. #mannequinchallenge Teams, athletes, and leagues have mastered social media in a more sophisticated way than many other industries. They are some of the first to embrace new platforms, and to jump at the chance to participate in memes and movements. In many cases, they catapult new content into mainstream culture. Iâ&#x20AC;&#x2122;m still in awe of the close to 12,000 people at the Perth Arena in Australia that pulled off the mannequin challenge at a Perth Wildcats basketball game this past November. Not only should brands learn lessons from the sports industry, they should leverage the power of the sporting world to give their own social movements a winning edge.

THE BIG TAKEOUT Social platforms are shaping how fans engage with their sports passion â&#x20AC;&#x201C; they now feature live sports (NFL games on Twitter); real time scores, stats and commentary through the Facebook Sports Stadium; direct access to athletes on Uninterrupted and Slyce; and new memes and movements (#mannequinchallenge). They have become THE place to access sports content. 16

/ SPORTS FOR THE SHARING GENERATION

THE NEXT BIG YOUTH SPORT

JONATHAN PAN

ENTREPRENEUR IN RESIDENCE /HEAD OF ESPORTS B R AV E V E N T U R E S

@notvert 18

/ SPORTS FOR THE SHARING GENERATION

We’re past the point of debating whether eSports is “here” or not. At the professional level of eSports, the top tournaments sell out whole stadiums, the top players earn millions of dollars, and there are more non-endemic brands in eSports than ever before. What’s less talked about is the nascent youth eSports market, which has an opportunity to disrupt the $9bn US youth sports market. An expert in all things eSports, Jonathan is Head of eSports / Entrepreneur in Residence at BRaVe Ventures, a strategic advisory firm that specialises in the technology, media, and entertainment (r)evolution. He started out as a Product Manager at Riot Games, before becoming the CEO of Ember, a North American League of Legends Team. Prior to Riot, he was a Senior Consultant in Financial Services at Ernst & Young. Jon received his MBA from NYU Stern, specialising in entertainment and finance, and a BA in Economics and Philosophy from Baruch College. He is a veteran of Afghanistan where he served as a Captain in the US Army. www.braveventures.com

Youth sports is supposed to be about providing kids with life-long compounding benefits from physical activity, teamwork, and leadership. Instead, youth sports has become very expensive, financially and emotionally. Only those from families with a strong financial footing can afford the training, equipment, and participation fees required to advance and excel through the system. According to Travis Dorsch, a professor at Utah State University specialising in youth sports, up to 10.5 percent of a family’s gross income could be spent on sports. That means a family earning the median household income of $55,755 in the US, could be spending $5,854 on sports. Meanwhile, the quality of coaches is far below what is expected in high school coaching and beyond. The typical background required of these coaches is former participation in high school sports, but it should also require experience with child development and physical education. The subpar coaching adds to the emotional stress of parents

trying to justify their financial investment. Youth eSports can provide what youth sports was meant to provide at a much greater scale and at a fraction of the cost. The fact that every interaction inside the game and outside (keystrokes, mouse clicks) is collected makes it possible to generate insights and analysis from each and every game. This type of self-coaching can be done for millions of people for minimal server costs. However, there is sometimes a benefit to getting a real coach. eSports coaches typically charge $15 - $50 per hour, a stark discount to private coaching in sports, which can cost hundreds of dollars per hour. A standard gaming PC plus accessories costs around $600 and can be used for education, work, and a variety of other functions besides gaming. Both computing platforms and internet access are cheaper and more accessible than ever before. THERE’S ABSOLUTELY NO QUESTION TO ME THE LEVEL OF SKILL, TRAINING AND DEVOTION IT REQUIRES TO BECOME A PROFESSIONAL GAMER.

Michael Phelps Beyond the greater scale and cost savings of youth eSports, it also teaches teamwork, leadership, and strategy. Like sports, it is often teamwork, not 19

individual play, that decides victory. Like sports, it is the in-game leader making the clutch calls in the final moments of a match or motivating a team to comeback from a bad play. Like sports, different strategies are built against different opponents. And building strategies for “five-dimensional chess,” as Mark Cuban, the owner of the Dallas Mavericks, famously described eSports, requires tremendous mental horsepower. Last but not least, naysayers point to the lack of physical activity in eSports to prove that eSports aren’t sports and that eSports athletes aren’t athletes. According to Michael Phelps, a 23-time Olympic gold medallist, the naysayers are wrong. He said that “there’s absolutely no question to me the level of skill, training and devotion it requires to become a professional gamer.” Phelps presented the eSports Player of the Year during The Game Awards 2016 to his “fellow athlete” Marcelo “Coldzera” David, a Brazilian Counter-Strike: Global Offensive player. Whilst physical activity isn’t involved in the act of competitive gaming, physical fitness has become a staple for professional eSports teams. The most successful teams have physical fitness regimens for their players because it takes a tremendous amount of discipline and energy to compete and win at the highest level. This has trickled down into youth eSports as well, since the best players in youth eSports want to mimic their pro eSports player role models. One example of this is the “Get fit with Snoopeh” campaign. Stephen

‘Snoopeh’ Ellis is a former professional eSports player who did a small workout based on his performance during his previous games and his viewers began to copy him, improving their physical fitness. What we can expect in the near future for youth eSports is the continued professionalisation of collegiate eSports. Riot Games and Blizzard Entertainment are the two game publishers leading the charge into collegiate eSports by hosting leagues and tournaments where students can win money towards their college tuition. As the infrastructure for collegiate eSports matures, we can expect to see more activity at the high school level. In the US alone, that represents as much as 15M high school students (public schools). It won’t be long until many parents recognise that youth eSports can help their kids with teamwork, leadership, and even physical activity.

THE BIG TAKEOUT Move over basketball, football and tennis – eSports has the potential to become the next big youth sport, providing kids with physical activity whilst teaching about leadership, teamwork, and strategy at scale and a fraction of the cost. Collegiate eSports is leading the way, and high school level eSports should shortly follow.

20 © Ollie Taylor

/ SPORTS FOR THE SHARING GENERATION

ESPORTS Â© Thomas Leuthard

FOREWORD JIM DOWLING

MANAGING DIRECTOR H AVA S S P O R T S & E N T E R TA I N M E N T C A K E U K

@jimdowling 24

/ ESPORTS

Don’t be fooled by eSports. Its name – with the prefix of an ‘e’ for ‘electronic’ – implies another technology or innovation that us mere mortals with human brains in our heads have to understand. For sure, there are new platforms and channels for us to grasp. Aligned with some mind boggling audience and engagement figures, a sense of urgency exists around eSports that if we don’t jump on board now, we’re all going to miss the bus.

But don’t stress. As the following writers will demonstrate – eSports goes beyond gaming and digital to reveal human trends that we see in other areas of entertainment. Young people are turning their backs on the billboard heroes of global sport and entertainment properties – and instead forming new relationships with the authentic characters and personalities of YouTube, Twitch and Fnatic. Welcome to the new world!

AN EXPLOSIVE YEAR AHEAD CHRISTOPHE AGNUS

HEAD OF ESPORTS VIVENDI

@cagnus 26 Â© mickiel

/ ESPORTS

First off, let’s be clear: with worldwide revenue at around $700m in 2016 (0.7% of the video game industry), eSports is not THE big thing. But if you look at the trends (40% annual growth), you might consider it as the “growing thing that should be big soon”.

Christophe is a digital entrepreneur who has founded multiple award-winning media and internet start-ups. He is the former CEO of Mondadori Digital, the French digital branch of the media company and was a Senior Reporter at L’Express News magazine, where he created the digital edition. He now heads up eSports at French multinational mass media and content group, Vivendi. www.vivendi.com

Looking at demographics, eSports has many, many young fans, around 150m worldwide, with 75% under 34-years-old (according to Deloitte). As a brand you should definitely add eSports to your list of priorities. And then of course, there’s passion. Go to an eSports event and you will discover the extreme passion of eSports lovers… just like traditional sports fans. 2017 is going to be an explosive year. There are three reasons for this: - Structure: In the beginning of eSports, competitions were organised by game publishers at an international level. In 2017/2018 we will see structured national and regional championships paving the way for potentially more relevant national and regional brands to have direct access to the eSports audience, not just the big global guys. - Professionalisation: Tens of football clubs, including Manchester United and Paris Saint Germain (PSG), have created eSports teams that will compete with established eSports teams like Vitality or Fnatic. - Distribution: Following the popularity of online streaming on Twitch, YouTube or Dailymotion, commercial TV will start broadcasting events. Turner Broadcasting System (TBS) is doing it in the USA as is Canal Plus in France.

FOOTBALL CLUBS, LIKE MAN UTD AND PSG, HAVE CREATED ESPORTS TEAMS THAT WILL COMPETE WITH ESTABLISHED ESPORTS TEAMS.

Others will follow. All for the good of quality production. All these developments are going to enhance the global role of eSports, and make it accessible (and understandable) for an even wider audience than today. But it can also turn wild and messy, like anything growing at a frenzied pace. The challenge for the publishers will be to control the quality and a logical order in the competitions. They will then have to work closely with the broadcasters and the events’ organisers to form a win-win partnership. For everyone, it’s now time for investment in events, championships and teams to build the foundation for this “next big thing” that should, in a few years, compete with football and basketball for media attention. It’s certainly worth a try.

THE BIG TAKEOUT With annual growth at +40% and a growing fan base of 150m, eSports is set to explode globally in 2017, thanks to structured competitions, new professional teams, and TV broadcasting. A good bet for investors and sponsors. 27

, YOU AINIT SEEN NOTHING YET!

DARREN NEWNHAM

BUSINESS DEVELOPMENT DIRECTOR F N AT I C LT D

@DarrenNewnham 28

Â© Ochre Jelly

/ ESPORTS

Following this year’s trend of large US sports teams entering eSports, 2017 will continue to see outside investment and in some cases purchases of top and mid-tier teams. The NBA’s Philadelphia 76ers’ purchase of Dignitas (EU) and Apex (NA) as well as Magic Johnson et al’s investment in Team Liquid has sparked an apparent gold rush in this space and until one of these investments proves negative, it will only continue.

Darren has been in the games industry for over 20 years, holding senior positions at Disney Interactive, SEGA, O2 and Three where he built and managed high quality, industry leading teams. He is now responsible for all business development and commercial sponsorship opportunities for one of the world’s largest and most successful eSports teams, Fnatic. He works with a diverse portfolio of partners guiding them through the high speed, high drama and changeable landscape of eSports. www.fnatic.com

Broadcast TV will go from having its toe in the water to a more mainstream offering. Turner Broadcasting System’s (TBS) ELEAGUE in the US has bucked the trend of Friday night shows losing viewers. PRIZE POOLS WILL GO INTO THE MULTI-MILLION-DOLLAR MARK.

According to Digiday, ELEAGUE viewers have watched 13.3m hours of content across Twitch and TBS. Sky and ITV in Europe have invested in Ginx eSports TV, offering 24-hour eSports content. Expect the likes of ESPN to be reacting to this soon. One of the areas most in need of improvement and growth in eSports over the next 12 months is stats and analytics. Until now, eSports teams and organisations have been very emotive. We all know that any brand that engages with eSports fans will be well received and will get likes on social media if the campaign is organic and has an eSports feel to it. But actual conversions and valuation of CPA etc lacks platforms and tools behind the scenes to accurately measure ROI. There are several sports agencies now moving into eSports

to offer these services, but investment in this area for an eSports centric stats platform would see results. Finally, the games themselves will have all eyes on Blizzard, as the publisher of two of the six games that eSports fans consider the Premiere League of viewing. Overwatch will continue to grow and overtake League of Legends in viewership and fanbase, prize pools will go into the multi-million-dollar mark (although not reaching the heady heights of DOTA2’s $22m TI6 final prize in Seattle in August 2016) and more teams will join the tournament roster. For Heroes of the Storm, Blizzard have announced a new league and season structure to the year’s competition, which should increase viewership and make scheduled programming easier around the live events, as well as make the game stronger against its competition (DOTA2, LoL). Overall 2017 will see exponential growth in eSports (from its already huge 150m fan base), and this is without including the new upcoming grassroots opportunities, the rise in player vs player competitive gaming (Streetfighter, FIFA, Mortal Kombat, F1 etc) and much more. As we say in the industry, GL & HF (good luck & have fun).

The hottest trends to watch - outside investment & purchases of teams, a more mainstream eSports offering on TV, improvement in stats and analytics, and the publisher Blizzard and the evolution around its games. 29

HARDER, BETTER, FASTER, STRONGER

60 SECONDS WITH... PETER WARMAN

CEO & CO-FOUNDER NEWZOO

@pjwarman 30

Â© Viktor Hanacek

/ ESPORTS

A frequent speaker on the business aspects of the games industry, Peter is CEO and co-founder of Newzoo, the international games market research specialist that services clients such as Facebook, Tencent, YouTube, Blizzard, Microsoft, EA, and Red Bull. An expert in all things digital, he previously managed sales and development for Europeâ&#x20AC;&#x2122;s largest interactive agency (LBi) and led the commercial development for a multiplayer online game for children. www.newzoo.com

What are your predictions for the growth of the market in the next few years? How do you make your projections? Currently, we foresee a global audience of 215m eSports enthusiasts and $1.1bn in revenues (merchandise, ticketing, media rights, direct advertising, sponsorships) in 2019. Currently, $3.5 in revenue is generated per fan on an annual basis. This is extremely low compared to more traditional sports, hence the investments of sports celebrities, companies and clubs into this space. We anticipate this to grow to $6.0 in 2019 on top of the growth in fan base. You could call this conservative but there are still many challenges that need to be overcome before eSports will deliver the revenues per fan as sports leagues do (e.g. $60 a year for every NFL fan).

Who are eSports enthusiasts? Why are they valuable targets for brands looking to get involved in gaming? For some it is the same target group as they now try to reach with sports. Millennials are shifting hours from sports to eSports. On the other hand, a large share of eSports fans arenâ&#x20AC;&#x2122;t fans of traditional sports and are extremely hard to reach or engage with. Gaming as a whole has always been hard for brands to use as a platform to engage with this target group, but now with viewing teams and live events, it fits a lot more with the media approach they are used to.

Broadcasters around the world are starting to give airtime to eSports. Is there a chance that eSports might bypass traditional sports with young people? If so, when? Yes. Amongst millennial males 20-35 years old, itâ&#x20AC;&#x2122;s already challenging hockey One thing that is holding eSports back and baseball in the US. eSports provides is the traditional nature of media and the mix of involvement (playing and sports agencies that service brands. streaming), entertainment (viewing) eSports is never the core of campaigns and live events (attending) that the new that they propose to brands but a nice generation has come to expect. icing on the cake with limited budgets. Media agencies are reluctant to invest How do you measure the gaming in market intelligence as this field is still market in terms of the audience and extremely marginal in terms of media revenues? spending. At Newzoo, we have spoken Newzoo has been researching, modelling to them all but hardly any of them are and reporting on the games market since willing to invest money or serious time 2009. In 2013, we earmarked video into this space. streaming and eSports as a key growth trend for the industry, illustrated in our report PC Gaming, Power to the People, 31

published in the fall of that year. It also marked the start of a 9-month effort to segment, classify and model the new space as well as research eSports engagement amongst consumers in over 25 countries. The huge consumer research effort has continued on a bi-annual basis and forms part of the input for our Global eSports Audience and Revenue Model that projects towards 2020 on a country, regional and global scale. Other data input includes an array of economic growth KPIs per country as well as viewing hours on platforms such as Twitch, YouTube and its Chinese counterparts such as Douyu and Panda TV. Then there is prize money and attendance data that we gather or track ourselves. We also track player behaviour amongst 20m core PC gamers across the globe continuously, to spot changes in eSports franchise popularity. A key component comes from the main players in the eSports economy: many provide insight into their actuals in terms of revenues and audience and/or validate the results of our analysis before we publish anything. Our recent formal partnerships with top teams such as G2, Immortals, Fnatic, Navi, The Alliance and Chinese LGD Gaming are aimed to cement this and confirms our belief that the teams will take an increasingly central role in eSports and its revenues.

brands to decide if and how to invest in this space as they match the audience demographic with that of their brands and products. For players in the eSports economy it is the combination of big data (tracking viewing and playing behaviour) and consumer insights that makes the difference. Our Global eSports Audience and Revenue Model has increased in complexity and granularity enormously over the years. We are investing in the next level of granularity that I cannot say anything about yet as the big traditional research and marketing companies all want to become a player in this space and we are dedicated to remaining the world-leading specialist in this field.

THE BIG TAKEOUT In 2019, Newzoo predicts the global eSports audience will grow to 215m and $1.1bn in revenues, with the current $3 in revenue per fan set to double. eSports enthusiasts represent a valuable target for brands as millennials switch from sports to eSports, which is already challenging many traditional sports. Despite this growth, sports marketing and media agencies still need to catch up.

Where does the data come from and how has it evolved since you started? For global and local brands, our consumer insights are the key component for 32

ÂŠ camknows

/ ESPORTS

HUMAN AFTER ALL BAPTISTE TOUGERON

GLOBAL INSIGHTS & A N A LY T I C S D I R E C T O R H AVA S M E D I A G R O U P

@TougBat 34

Â© SteelSeries

/ ESPORTS

eSports is definitely starting to become a data & analytics driven industry…and it’s just the beginning. We all know the industry “stats”: number of players, views during the World Cups, fans at live events in stadia, number of downloads, big money prizes, etc etc. eSports is clearly well established and is still enjoying an amazing progression. To reach this level, you can be sure that a lot (though not everything) relies on the evolution of data & analytics practices. When we start to talk about big money in a specific sector, you also need to start talking about data, statistics, performance and ROI. ACCESS TO DATA IS MUCH EASIER, FASTER, BIGGER SINCE A MAJORITY OF THE ACTION IS ONLINE.

If we rely on a few best practices in terms of data & analytics, they should be: First, the use of data to personalise the mobile gaming experience based on the customer’s behaviour, feeding him/her with the right options and situations to increase engagement. The right experience for the right target with the right content; every marketer should dream of this combination for their ads! Second, the use of analytics to predict (with a very high level of certainty), which team could win a multiplayer game thanks to a complex algorithm based on the profile of the players, their past actions, their opponents, and

each decision they take during a game. Amazing in terms of data sciences! But let’s step back a little bit. Data & analytics have always been at the centre of all highly rated sports, of any competition really, where every single movement or combination is tracked, the impact of weather changes precisely measured, and even players are trained based on stats; everything is done to optimise performance. So what’s different with eSports? In fact, data is starting to be as prevalent as in other sports like football, basketball, cricket or rugby, with a little plus: access to data is much easier, faster, bigger since a majority of the action is online (which obviously reminds us of the Big Data mantra), with even more opportunities for brands to be more meaningful for fans. In the end, what also makes eSports a “normal” sport is that any final decision is taken by a real person, and will always lead to unpredictable results. Thanks to this, we can be confident predicting that the industry should last for a long time. eSports is dead, long live eSports!

THE BIG TAKEOUT Access to data in eSports is much easier, faster and bigger as so much of the action is online. Thanks to data about player/viewer behaviour, the gaming experience can become more personalised whilst analytics can help predict who will win. Opportunities abound for brands to create meaningful experiences for fans. 35

RETIRED AT 25

RANDI CONNER

SENIOR ACCOUNT DIRECTOR H AVA S S P O R T S & E N T E R TA I N M E N T U S A

@RandiConner 36

/ ESPORTS

2016 has been marked by some of the biggest investments in eSports, from major media groups such as Turner Broadcasting and Vivendi; to brands such as The Coca-Cola Company, Red Bull, Pizza Hut, and Intel; to professional sports teams who are launching their own teams and leagues (ie French Ligue 1 launched eLigue 1 in partnership with EA’s FIFA17, Europe’s first professional eSports football league).

career is surprisingly brief, with many of them hanging up their controllers well before their 30th birthday. As a result, players have to make a decision about what to do next with the career they built at such a young age.

Some retired players end up becoming managers, coaches, or creators of teams, leagues or games. For example, Stephen “Snoopeh” Ellis, a former League of Legends player who retired at age 23, This year also marked the first genera- is now working in business development tion of eSports legendary players to hit for US-based eSports betting platform retirement. Unikrn, which allows fans in the UK and across Europe to bet on eSports Team SoloMid fan favourite Brian matches. “TheOddone” Wyllie retired at the age of 25 after playing for four years; European legend Pete “yellowpete” Wüppen IN 2017, WE’LL START TO SEE THE left Evil Geniuses at 25; and Dignitas PLAYERS TAKE A LARGER ROLE legend Michael “imaqtpie” Santana BY TAKING BACK THE GAME THEY moved on to a much more lucrative KNOW AND LOVE. career in streaming at just 22. These retired players are now moving behind the scenes and into the workforce, thus Former professional League of Legends helping the eSports industry grow. player Alberto ‘Crumbzz’ Rengifo formed an agency for professional The explosion of eSports and the fact it is eSports, APE. The agency will represent hitting mainstream audiences will consi- players, providing services to clients such derably grow the number of players, as contract negotiations, individual sponboth amateurs and professionals. Many sorship deals and post-career managewill be willing to give up everything to ment, thus increasing transparency in pursue their passion and try to make a the sport. living out of it. However, their gaming career will be very short-lived. In the coming years, we’ll see a growing number of players leave the stage, and Due to the intensity and mental strength unlike other major sport associations required of gamers, the pro-gamer like the NFL, this discipline does not 37

like the NFL, this discipline does not yet have a developed organisation set up to truly support the interests of professional players and their transition from competition to retirement. What is available currently is in its infancy and supported by industry leaders like game developers and investors. We are only beginning to see more player organisations, such as the Professional eSports Association (PEA), come on board in 2017, but time will tell if these organisations will truly support the needs of the players. Whilst gamers started this industry, it is attracting attention and investment from media and brands with very little knowledge of the space. Gaming is all about legitimacy and as the industry is developing so rapidly, many claim it may be losing its credibility. We believe that in 2017, we’ll start to see the players take a larger role by taking back the game they know and love.

the industry. Successful brands will be those that seize this opportunity early and are committed to helping protect and support these “athletes” in their life after stardom.

THE BIG TAKEOUT eSports gaming careers are short, and players are starting to retire, mostly in their mid-20s. Support for retired players is sparse, as player organisations are only now developing. Brands have an opportunity to fill the void and create meaningful partnerships with retired legends, and thereby highlight the true value their involvement brings to the sport.

We must also not forget the professional players, and their potential as they retire. Brands have a big role to play and can partner with retired players, either supporting their integration into the educational system, or by helping them leverage their experience in their new careers. There is currently a big void surrounding professional player engagement, and a real opportunity for brands to play a meaningful role to bring back credibility and legitimacy within 38

/ ESPORTS

GO FORTH & CREATE

60 SECONDS WITH... LESTER CHEN

GLOBAL HEAD OF ESPORTS

YOUTUBE

@hokum_ 40

/ ESPORTS

Lester was a professional gamer from 2004-2006, back in the days of major league gaming when console games were exploding. With a background in live programming from his time at Machinima, He now focuses on making in-roads into live through eSports at YouTube.

As a gamer yourself, what does your experience from having been on the “other side” add to your role at YouTube? Being a former player has given me invaluable insight and experience in a currently crowded space. Having a deep understanding of the values and motivations of eSports organisations and players is paramount to the growth of eSports. Questions like the following intrinsically help predict and guide our team to better business decisions when making content investments. What kind of skill gap exists within a game? Is there a large enough competitive player base for the eSports title to exist long term? What rulesets and regulations need to exist? What balance issues does a game experience? Is the game spectator friendly? What makes the game entertaining? How accessible is the game to casual players? How genuinely different is one game from the next? Being on the other side has allowed me to gain insight into what makes a pro player or an eSports enthusiast tick. In order to create compelling content, you need to know the best way to communicate and design programmes that will touch the core motivations of your audience. Gamers are the quickest audience to sniff out something unauthentic, so being able to inject an educated opinion on topics ranging from press releases to sponsor messaging is crucial.

YouTube as far as gaming goes, so we wanted to put our foot forward in the mobile space. Last year Twitch as an entire platform did 4bn watch hours of live stream content whereas mobile alone on YouTube did 1 – 1.5bn watch hours this year. We realised we have a lot of power here and we should tap into this market. The creators are paid talent within the YouTube space. At an event like this, how does the agreement differ to a traditional sponsorship deal? It’s not very clear-cut - at least that is how the creators look at it. This is a great opportunity for them to gain exposure so whenever there is a big event they naturally want to compete. We did pay them to participate but it wasn’t as simple as us sponsoring them just to come out. The creators were the stars of the show. They were flown out early just so we could shoot interviews. They were promoting, creating the content and even singing the theme song. They were an integral part of the show from top to bottom. We didn’t ask these guys to commentate - they wanted to. It was very free form. We told them the rules and they did it within the broadcast. Yes, we paid them to participate but the value that we got out of that was immense.

Do you think the event would have been as successful without the impact and the influence of the creators? It would have died. If there is no gateway through which people can What made the Clash Royale King’s realise the competitive nature of a Cup (YouTube’s first foray into mobile game, they will never gravitate towards eSports) such a pivotal shift for the it. Using the creators to bridge the gap between casual and competitive brand within eSports? The King’s Cup was very much a test was the best way to get eyeballs to tube event. Mobile games dominate this event. It’s impossible for a game 41

Is it more about leveraging the creators and the content that you have and then presenting that back to brands in an effort to get them involved? It’s a mix. We think about packages that we try to sell to brands. We like to have the live content but we also want to package a selection of the creators. We have so many niche pockets of gamers that we’re able to create big moments within the gaming space. The difference between YouTube and Twitch or It will be interesting to see what the any other platform is that we have these viewership is if Supercell goes on to content creators who have their own fund their own organic tournament. I’m communities and that becomes increcurious to know how an event like that dibly valuable if you’re a brand. You not goes without the big creators involved. only get a live event but you can also work with the actual voices themselves Are you thinking about how or what to push your message even deeper. It’s you could do to stretch the engagement a two-layer approach that allows a brand (onsite or online) at future eSports to tell many stories and go beyond the events? one big moment Right now brands are playing around with experimental dollars. Here at YouTube What is the future of eSports and our business is content distribution. We gaming for YouTube in the next 12 are a huge platform dealing with many months to 5 years? different verticals and siphoning eyeballs If we’re able to get more and more in many different ways. Widening the eSports content on our platform we funnel is our number one priority. We will have a hotbed of gaming content could just go and buy all the content with an audience that are ready to or try to invest our way into acquiring consume. Increasing this audience and content but that is not going to grow reaching more first time viewers of the pie. How do we use 100m logged-on eSports content will allow us to bring new gaming users who don’t have any idea amounts of viewership and further legitiof what eSports even are and who have mise eSports. Our sales team will then be stayed away from the Twitch bubble? able to bring brands in to help keep that We’re conscious of getting the next hamster wheel of content, acquisition million if not billions of gaming users to and brands getting in and reinvesting the watch this content. content and going after new content. If and when we get all the content on YouTube, there will be a better treadmill to drum up bigger audiences. More brand dollars in the space unlocks our ability to create bigger events and reinvest dollars to bigger and better programmes where one hand will feed the other. to grow a following if no one knows what the game means at a competitive level, so it was critical that influencers were there. The creators we used had a combined total of 10m subscribers. They were our entire marketing vehicle. We used them for content creation as well as promotional methods. We got a lot of organic pick up that we didn’t have to pay for, as just having them involved was a huge focal point and kept the voice authentic.

THE BIG TAKEOUT Mobile games dominate YouTube as far as gaming goes, with 1-1.5bn hours watched. Content creators are central to YouTube’s eSports strategy (both around live events and online) as they populate the platform with gaming content, add their unique voice, and grow and engage gaming communities. They can be a valuable partner for brands that want to engage eSports audiences.

/ ESPORTS

DATA & TECHNOLOGY

FOREWORD FRANCIS COADY

GENERAL MANAGER

H AVA S S P O R T S & E N T E R TA I N M E N T A U S T R A L I A

@HSE_AUS 46

/ DATA & TECHNOLOGY

Apart from being ubiquitous buzzwords, what does data and technology concretely bring to those of us working in the sports & entertainment industry? From groundbreaking talent and innovation springing from sports technology start-ups to AI that personalises and reveals, we can uncover hidden moments across the media landscape that may unlock the next viral narrative or truly customise each client interaction to the individual. 2017 will see a continued blurring of traditional

disciplines that will aim to highlight what motivates and what endures in the mindâ&#x20AC;&#x2122;s eye of the consumer. With greater budget accountability, the measurement of data, utilising complex modeling and algorithms, will assist agencies and clients respectively to better channel funds that will ultimately secure greater returns and value for all parties involved. With more and more data, thereâ&#x20AC;&#x2122;s more learning ahead!

MARKETS OF ONE: COGNITIVE INTELLIGENCE ENABLES MASS PERSONALISATION

JASON JERCINOVIC

G L O B A L H E A D O F M A R K E T I N G I N N O VA T I O N & GLOBAL BRAND DIRECTOR H A VA S

@j jercino 48

/ DATA & TECHNOLOGY

We are sitting on a gold mine. For quite a while now, we (brands and marketers) have been collecting a treasure trove of digital information on everything from changing weather patterns to the spread of infectious diseases. We have digitised the history of the world’s literature. We track and store the movements of automobiles, trains, planes and mobile phones. And we are privy to the raw, real-time sentiments of people through billions of social media data points.

can now have insight or intelligence into this data, including things that don’t fit neatly into databases or spreadsheets: images, video, text and sound.

Individually, each of these digital resources has been immensely useful, applied to solving specific problems in dozens of industries. But collectively, when integrated, cross-referenced, and analysed, this body of information represents the most powerful natural resource the world has ever known. And it is growing exponentially.

It’s easy to misunderstand or underestimate the implications of this concept. In part that’s because we’ve been promised this capability for years, but all we’ve gotten is incrementally smaller market

It is reasonable to expect that within this untamed corpus of data lay the secrets to the world’s biggest problems, things like defeating cancer, reversing climate change, or managing the complexity of the global economy. But until recently, we have not had the means to mine this resource properly. It was too big, too messy, and too disparate. For the first time, the tools we use to process and analyse data are catching up to the tools we use to produce it. Some call it artificial intelligence. Others call it cognitive computing. Whatever the name, the potential to quickly and purposefully analyse the world’s information and put it to use is available to us now. Using machines that learn, reason, and understand, we can now interact with the vast amounts of complex, ambiguous information. We

This capability holds profound implications for nearly every company in every industry. But for those of us in the marketing profession, it brings us ever closer to reaching a long-soughtafter goal: markets of one.

HOW DO WE USE COGNITIVE INSIGHTS AS A WAY TO PERSONALISE RECOMMENDED PRODUCTS AND CONTENT TO CUSTOMERS IN A MORE INDIVIDUAL AND IMPACTFUL WAY?

segments or personas. Now we’re finally in a position to literally tailor millions of customer relationships to each individual, from the way their products and services are designed and delivered to the way their customer service requests are addressed. The impact of this capability will go far beyond improvements in marketing efficiency and customer satisfaction. In our lifetimes, we could be seeing the disintegration of mass markets, the death of one-size-fits-all, and a redefining of economies of scale. In fact: it is actually already happening. 49

At Havas we employ IBM Watson as a cognitive intelligence resource in our client accounts. But the future of marketing started to come into clearer focus recently when we started seeing our clients use these insights to create custom personal platforms.

What happens when that same capability is applied to marketing? Or advertising? This thinking is not just theory; we are doing this now with many of the brands in the Havas portfolio. For example, Havas recently worked with adidas on a cognitive product recommender – termed miWay. The challenge was “how do we use cognitive insights as a way to personalise recommended products and content to customers in a more individual and impactful way”. Using a cognitive powered intelligence, we are analysing customers’ social media to get a sense of their customers’ personalities. Based on that profile, we created a custom “look book of products,” and a mix of personalised influencer content which aligns with each user’s own personality. The result is that each and every feed is customised to each individual user. This is a great example of marketing “to the market of one.” But this is not just sports and athleisure. What about investing? We are currently working with TD Ameritrade 50

to use artificial intelligence to gauge each investor’s risk tolerance, financial sophistication, and the clarity of their goals. It doesn’t do this by asking them to fill out surveys (which we know are inaccurate and rife with bias) or have a conversation with an investment advisor (which doesn’t scale.) It assesses the investor by having a natural language conversation, chatting about real life stuff. Stuff we care about like sports, food, fame and of course money. With these insights we are able to then offer unique investment advice. Each user gets a custom response. A market of one. The fundamental building blocks of this future are in place: broadband, data centres, cloud, analytics, and IoT. They are the drivers of modern day insight. And together they will yield a new understanding of the complex systems that facilitate life on this planet and drive the majority of economic development. As a marketer, I’m excited about the prospects of mass customisation. But as a global citizen, I’m even more excited about the potential to mine the world’s greatest natural resource – its data – for centuries to come. What can you do with Cognitive Intelligence?

THE BIG TAKEOUT Armed with a growing library of digital information and the tools to analyse it through machine learning and AI, marketers can now tailor customer relationships to the individual. It’s the end of mass marketing and the start of the market of one.

/ DATA & TECHNOLOGY

AI MEETS SPORTS THE GOLD MINE OF PASSIONS

CIARAN POWER

DATA P L A N N E R H AVA S H E L I A

@theciaranpower 52

/ DATA & TECHNOLOGY

The on-demand nature of modern 24-hour news coverage means there is often an incredible focus on events that can easily be crystallised into one moment for publication that will generate the most clicks and views.

Carolina town, was quietly garnering a massive 1.5m shares nationwide. An estimated 150k of these were in the key state of Florida, which Trump won by 120k votes – but this story was hidden from mainstream news coverage.

These spectacular episodes crash in, taking centre stage in the moment, often to the detriment of the more subtle paradigmatic shifts – those genuine insights made by people over longer periods of time with continued exposure and interpretation of the subject.

eagleAI hummed away in the background, gathering data and insights from stories like this, analysing the more nuanced and slowly-developing feelings of everyday people that were often overlooked by traditional media and analysts. As the majority of polls predicted a Clinton win, eagleAI was one of the few sources that accurately predicted a Trump victory, calling 4 of the 5 swing states in the process.

Strong bonds, like the complex relationships we develop with an athlete or sports team, are rarely made in one moment, or even across a series of discrete, disconnected events, but over time. By using AI for social listening, we are able to cut through the noise to understand the authentic considerations of real people, not just what the headlines tell us they feel, and how these elements of cultural capital accumulate. A great example of this is eagleAI – an artificially intelligent programme we created to help inform the UK broadcaster ITV’s live coverage of the US election, through a continuous analysis of the most shared articles on social media. As the media focused on the major scandals and sharp talking points, an article titled ‘Why I’m Voting for Donald Trump’ by Kelly Quelette, a pro-life coffee shop manager from a small North

ARTIFICIAL INTELLIGENCE COULD BE USED TO CUT THROUGH THE MEDIA NOISE AND PR BLUSTER TO UNDERSTAND FANS' AUTHENTIC PASSIONS AND FEELINGS AND IDENTIFY THE AUTHENTIC NEXT BIG THING.

ITV News Programme Editor Alex Chandler praised eagleAI for enabling the network to conduct a “deep dive on millions of data points, in a way no programme has been able to do before”. In sports marketing, artificial intelligence could be used to cut through the media noise and PR bluster to understand fans’ authentic passions and feelings and identify the authentic next big ‘thing’. This could mean picking up the gradually building sentiment towards an emerging 53

team, like the controversial football team RB Leipzig (who are backed by energy drink Red Bull and rapidly climbed from 5th division to the Bundesliga while “betraying its fans and German football traditions” due to its commercial structure), in measuring the rapidly rising buzz one might expect from the next rising crossover star, tracking the rise of a new Neymar, or keeping abreast of the new key terms and platforms in a constantly evolving culture. After this, it could be implemented in programmatically determining the right people to target for the resultant campaigns – based on tribal allegiances, expressed interest, and even their individual personalities. We are just on the cusp of the AI revolution, which promises to become a continuous source of insight into fans, fan engagement, and fans’ relationship with sports by making connections we never could before. Expect sports marketing to become smarter, more targeted, and more creative as a result.

THE BIG TAKEOUT As demonstrated by eagleAI predicting Trump’s win, AI, through social listening, has the power to reveal what is often hidden to traditional media – what everyday people are really thinking. When AI meets sports, we’ll be able to better understand fan sentiment by measuring the buzz about an emerging team, a rising crossover star, and new terms and emerging platforms, to name just a few. 54

/ DATA & TECHNOLOGY

START ME UP... AND SPORTS INNOVATION WILL NEVER STOP

CHARLES BAL

ACCOUNT DIRECTOR & F 5 I N N O VA T I O N L E A D E R

H AVA S S P O R T S & E N T E R TA I N M E N T F R A N C E

@CharlesBal1 56

/ DATA & TECHNOLOGY

Muhammad Ali, Dick Fosbury, Billie Jean King, Ayrton Senna, Antonin Panenka… Sports history is full of “unreasonable” men and women who triggered major shifts and memorable advances in their respective disciplines. These athletes chose to think outside the field to disrupt their sport, inaugurate new forms of expression and bring their discipline into a new era. In 2017, who will be the next game changers? Athletes? Sponsors? I bet on… START-UPS!

I bet on those whose raison d’être is to cleverly, usefully and substantially challenge the status quo. Start-ups are already disrupting today’s sports industry with new products and services offering new experiences or revenue streams for athletes (ex: LSee* and its metabolic tracker analysing fat-loss biomarkers from a single drop of blood), organisers (ex: NextVR which has partnered with the NBA to broadcast one game per week in virtual reality), fans (ex: VoGo Sport* allowing in-stadia spectators to access live multi-camera angles and replays from their mobile phone), and brands (ex: Running Heroes*, allowing runners to redeem their km for exclusive offers from brands). This trend will only multiply in the coming years. In fact, the explosive attractiveness of the sports market for tech investors

provides solid proof. According to TechCrunch, venture funding for sports tech start-ups has been growing nearly 30% per year since 2012. VCs, brands, as well as professional teams and athletes are all investing big money (such as Intel which in October 2016 announced a $38m investment into 12 sport tech start-ups…) in the creation of investments funds, accelerator programmes, and product development for and with start-ups. That’s precisely why we, at Havas Sports & Entertainment France, decided to launch a comprehensive and ambitious innovation plan in 2016, entitled F5 (press this button on your keyboard and you’ll understand :-), which involves an exclusive partnership with Le Tremplin, the leading sports start-up accelerator in France, and the incubation of several sports start-ups inside our own walls. Innovation through collaboration with start-ups will be a major new driver of growth and opportunity, for our development as an agency and for new offers for our clients. We recently launched “United Heroes”, a joint offer with Le Tremplin’s Running Heroes, to promote sport practice at work. This is how we have “reasonably” chosen to innovate, thanks to unreasonable men and women…!

THE BIG TAKEOUT Venture funding in sports tech start-ups is growing 30% per year, with big investors like Intel jumping in. Creating new services and products for athletes, organisers, fans, and brands, sports start-ups have immense growth potential.

*Start-ups incubated at Le Tremplin (www.letremplin.paris/)

ECONOMETRICS: THE BEST NEW METHOD FOR SPONSORSHIP VALUATION

DR ANNA SEMENS

H E A D O F A N A LY T I C S

H AVA S S P O R T S & E N T E R TA I N M E N T C A K E U K

@annasemens 58

/ DATA & TECHNOLOGY

Say the word econometrics, and you’ll probably get a blank stare. At a very broad level, econometrics is about using mathematics to describe relationships between variables and giving empirical context to those relationships. There are many different econometric methods, which we won’t go into of course, but they tend to share the commonality of using fairly complex data sets to uncover simple patterns, that explain what’s happening in the economy. Traditionally sponsorship deals have been valued based on advertising equivalent value or even just gut feel, but given the vast amounts of money involved in these deals, we need to make sure that both brands and rights holders are getting fair value for money. ECONOMETRICS CAN HELP US TO DETERMINE WHICH RELATIONSHIPS BETWEEN VARIABLES ARE SIGNIFICANT AND WHAT EACH COMBINATION OF VARIABLES IS LIKELY TO BE WORTH.

More and more deals are being signed that are based on brands benefiting from a positive association with a particular property as opposed to tangible rights that were traditionally sought and therefore the method of valuing those deals must also evolve. Econometric methods can help us with that. Havas SE Cake’s sponsorship database includes thousands of sponsorship deals,

WE’VE NEVER HAD ACCESS TO MORE DATA THAN WE DO NOW, BUT WITHOUT BEING ABLE TO MAKE SENSE OF IT, DATA IS OF LITTLE VALUE.

their realised value as well as contractual terms and intangible associations. Using this data, econometrics can help us to determine which relationships between variables are significant and what each combination of variables is likely to be worth, both in general and for individual industries or brands. This gives rights holders the confidence that they are maximising the value of their rights, and brands the confidence that they aren’t overpaying and have the optimal rights needed to gain a return on their investment. We’ve never had access to more data than we do now, but without being able to make sense of it, data is of little value. We’ve long been able to use econometrics to determine the ROI of advertising and other parts of the marketing mix. By borrowing techniques that are widely used in finance and the sciences, we can now also accurately determine the ROI from sponsorships and other marketing assets. So how exactly will econometrics shape the future? Whilst we don’t think that econometrics should be used to answer every marketing question, being able to isolate relationships between variables can certainly prove useful in determining how to optimise campaigns. For example, we’ve been working with a 59

large telecoms brand to ensure that theyâ&#x20AC;&#x2122;re getting the best value for money from their partnerships. We do this by undertaking a property pricing assessment and calculating the value of the media coverage generated around the partnership. This enables their sponsorship team to demonstrate the ROI compared to the initial investment in rights, which proves the value of sponsorship in the marketing mix, a question many board members and colleagues ask. As we get access to more and more data, weâ&#x20AC;&#x2122;ll be able to gain insights into how best to value and get value from partnership opportunities and campaigns.

THE BIG TAKEOUT Econometrics, traditionally used in finance and science, can help brands optimise their ROI in rights by revealing which assets add value and how.

/ DATA & TECHNOLOGY

NEW W MEDIA 63

FOREWORD ADRIAN PET TET T

CEO

H AVA S S P O R T S & E N T E R TA I N M E N T C A K E U K

@aepettett 64

/ NEW MEDIA / NEW MEDIA

Some of the ideas, trends and analyses in this document will be wrong. We’d be deluded if we thought otherwise. The speed of change in technology, media and marketing are such that mistakes and bad bets are inevitable. But there’s one thing we know for sure: sport and entertainment will play a central role in creating the market for new technologies, new platforms and new ideas. We know this because most media innovations are normalised for a mass audience by sport, music, film and television content. OTT and Netflix, live Twitter streaming and the NFL, football and mobile

video. Without fantastic content, many of Silicon Valley’s brightest ideas can seem like a solution in search of a problem. The other thing we know is that predicting the next tech explosion is just one part of the skill set required of a world-class agency. We see athlete-owned platforms as the next big thing in giving fans direct access to athletes and athletes control over their messaging. We also see OTT content as a “slow but necessary” disrupter of the traditional sports broadcasting model, which will make the TV viewing experience all the richer. So stay tuned!

ATHLETES ARE THE NEW MEDIA

FREDDA HURWITZ

G LO B A L C H I E F S T R AT E G Y O F F I C E R H AVA S S P O R T S & E N T E R TA I N M E N T

@FreddaHurwitz 66

/ DATA & TECHNOLOGY

I wonder what Joe DiMaggio would make of today’s athletes, the notion of role model or the business of sport? Back in the day with no social media, lucrative sponsorship deals or own-brand sneakers, his success was 100% about what happened on the field of dreams, and of course, that time he was married to a certain Marilyn Monroe. Ditto for Babe Ruth, Carl Lewis, Muhammad Ali, Billie Jean King, Jackie Joyner-Kersee…Their global fan base revolved around how they performed, how “American” they were, how they made their teammates and fans feel, how humble they were (or weren’t) during the obligatory post-game interview. Yes indeed, the times they have a changed. LeBron James’ Uninterrupted in partnership with the Bleacher Report, Stephen Curry’s The Slyce, Derek Jeters’ The Players Tribune, Unscriptd and its numerous investors led by Andre Agassi, and one of the originals in this new age of athlete as medium - Big Papi with Off the Bat from the MLB FanCave. These aren’t simply outlets for players to engage directly with fans on their terms, sharing content that they deem important or relevant to their “brand”, one could argue that this is the 21st century version of a warm and fuzzy fireside chat. And it’s working.

According to Unscriptd, “the goal is to let athletes take control of their own narrative, the issues or stories that matter to them and deliver insight into their sport”, which mirrors Uninterrupted’s CEO, Maverick Carter – James’ business partner and childhood friend, “Uninterrupted was created as a platform for talent to access their fans,” and is now considered to be the go-to platform for some of the world’s most recognizable talent. When asked if this new trend in fan access to talent could bypass the role of the journalist, Carter felt that “the two are complementary and would continue to co-exist”. But down the line, will they? THE GOAL IS TO LET ATHLETES TAKE CONTROL OF THEIR OWN NARRATIVE, THE ISSUES OR STORIES THAT MATTER TO THEM AND DELIVER INSIGHT INTO THEIR SPORT.

Great athletes naturally command a certain reverence by the media and their fans. Throw in a loveable and/ or tempestuous personality, enough good looks, perhaps the superstar other half, a heart (let’s not forget the “do the right thing” mantra), and you’re really onto something whereby said athlete is often driving the new agenda and calling the access shots. Where this leaves the traditional beat reporter remains to be seen, ditto for the post-game interview. 67

Few athletes are as vocal as Allen Iverson in his heyday, so the ability to get up close and personal with an athlete you love (or even love to hate), is by default going to be a super exciting prospect for millions of fans everywhere. Yes, traditional meet and greets and a guaranteed number of sponsor “hero” shots are often still the norm with contracts, but those athletes who have taken control of their destiny off the field are paving the way for a whole new dynamic, dialogue and commercial destiny. It remains to be seen: will there ever be another Howard Cosell/Muhammad Ali partnership in this age of the athlete as the media…?

THE BIG TAKEOUT Uninterruped, The Player’s Tribune, Unscriptd, and Slyce are examples of athlete-owned online platforms where athletes share the stories they deem important, driving the dialogue and agenda. A new era for athletes to call the shots and give greater access to their fans.

/ DATA & TECHNOLOGY

LIVE SPORTS GO OTT JEFF GAGNE

S V P S T R AT E G I C I N V E S TM E N T S H AVA S M E D I A N O R T H A M E R I C A 70

/ DATA & TECHNOLOGY

Well that was fast. We are suddenly at a place in the rapidly unfolding history of media where Over-The-Top (OTT) services are no longer an emerging threat to the traditional television model, but connected television sets now actually rival the scale of cable. The math is simple: tech companies need to push out premium content so that the format is universally embraced to make money. OTT EMBRACES THE CUSTOMISATION THAT ALL DIGITAL CONTENT HAS SUCCEEDED ON AND PLACES IT BACK ON THE TV SCREEN, WHERE SPORTS ALWAYS PLAYS BEST.

Since its inception, the only true thorn in OTT’s side has been live sports, as the television rights model has been iron clad in protecting the major leagues’ contracts. But each time those major rights deals are renewed, room for additional content distribution seeps into the fold. Perhaps leading the way, the NFL has been testing and learning about their OTT audience potential in live games: last year through Yahoo! and currently via Twitter to mirror their new Thursday night package. This is clearly a signal to the marketplace that changes are imminent and that television is no longer the sacred cow. Rumours are swirling about the PGA Tour and the NBA creating their own “network” exclusively distributed via OTT, which forces television executives to debate if that’s a bluff to raise their own pricing

or a true and viable reaction to a marketplace that’s moving far faster than any contract can predict. It’s frankly a tough bet. Live sports are continuously toeing the line as an industry as they risk losing exposure to a whole generation of video natives: a Generation Z that will never meet a “cable guy” or have an intrusive set-top box on their mantle. The good news is this: making sports content available across a variety of distribution systems allows for both these younger demos to engage with their favourite sports and the avid fan bases to deepen their relationships via exclusive content. In 2017 and beyond, we can expect a rapid, yet calculated roll out, much like the NFL is practicing now, instead of a rights revolution. Sports continues to be the most dominant and reliable performer on traditional television, but that won’t be the case a decade from now if today’s young sports fans were neglected along the way. OTT embraces the customisation that all digital content has succeeded on and places it back on the TV screen, where sports always plays best. It’s perhaps the most necessary evil.

THE BIG TAKEOUT Live sports content has been slow to go OTT due to the rigid TV rights model. This content needs to be made available across a variety of distribution systems, or the risk is the loss of younger generations of fans. Expect a calculated rollout for OTT sport content in 2017, following the NFL’s lead with live streaming on Twitter.

DO THE RIGHT THING

FOREWORD FREDDA HURWITZ

G LO B A L C H I E F S T R AT E G Y O F F I C E R H AVA S S P O R T S & E N T E R TA I N M E N T

@FreddaHurwitz 74

/ DO THE RIGHT THING

Spike Lee catapulted the sentiment of “do the right thing” into the stratosphere when he released his ground breaking film in 1989, bolstered by Public Enemy’s war cry - Fight the Power. Do the right thing meant something on so many levels to cross generational audiences around the world; black, white, young, old. It broke through and got people thinking, talking, laughing, sharing, acting. Here we are nearly 30 years later…and I wonder if the richness and responsibility of these four words stacks up in our equally challenging world, that is faced with racism, sexism, homophobia, abuse, deceit, deception, Trump (sorry, I had to)…and I haven’t even begun talking about the sports industry yet.

When you apply this thinking to sports and the complicated ecosystem that shapes and guides it, who is ultimately responsible for taking on the wrongs and righting them: the athletes? The brands? The rights holders? The media? The fans? Our prolific, outgoing, no holds-barred contributors have a thing or two to say about the state of the sports world today, embracing their role in helping to be part of the solution whilst calling out those who are still hovering around fist base. Get ready to take a stand.

WILL IT ALWAYS BE KNOWN AS

“WOMEN IN SPORTS”?

60 SECONDS WITH... SALLY HANCOCK

M A N A G I N G PA R T N E R, Y S P O R T, CHAIR OF WOMEN IN SPORT

@Sallyhancock1 76

/ DO THE RIGHT THING

Named one of the Most Influential Women in Sport by The Guardian in 2015 and UK Sponsorship Personality of the Year in 2013, Sally is an acclaimed leader in the field of sponsorship, co-heading the sports strategy and sponsorship consultancy Y Sport. Previously she was responsible for the Lloyds Banking Group London 2012 Olympic Partnership. www.y-sport.com

Where is women’s sport currently? We have a lot to be proud of and celebrate. Women’s sport has new heroes. Not only our hugely successful athletes in domestic (UK) and international competition, but the extraordinary numbers of women and girls getting active for the first time, and sharing their experiences with others. Sport England’s This Girl Can campaign has seen 2.7m more women and girls claiming to take part in exercise and activity as a result, although, still 1.73m fewer women than men are active on a regular basis. Why does it lag behind men’s sport? Is it for lack of funding, excitement, or is it a historical bias problem? For all the achievements of the last 18 months, the journey towards a level playing field in sport still has a considerable way to go. With the exception of the Rio 2016 Games, and a few dedicated broadcast partners, coverage of women’s sport in the last 12 months, whilst having improved, still remains at the margins. Women’s sport can find itself trapped in a vicious circle – a chain of dependencies around a lack of major events, lack of coverage, leading to a lack of sponsors, engagement and awareness. We need forward-thinking brands, sports and media to disrupt this, and enable women’s sport to achieve the recognition and positioning it deserves,

and to inspire more women and girls to get active and engage. What role does media coverage play? Media coverage is key – but this has to be the right coverage. Too often sports women find themselves judged against their male counterparts, their sport compared to the men’s version, their looks commented on more than their sporting achievements. For example, international media came under fire at Rio 2016 for undermining female Olympians’ achievements by linking reports to their male partners. Hungarian swimmer Katinka Hosszu won gold in the 400m individual medley, beating the previous world record by nearly two seconds. Speaking on TV after the event, an NBC commentator referred to her husband and coach Shane Tusup as “the man responsible” for Hosszu’s record-breaking performance, sparking criticism on social media. This endless undermining of women’s achievements is not helpful or motivating – more opportunities for women to work in sport and media would be one step forward. The Rio Olympic and Paralympic Games brought a great deal more women’s sport to TV this summer. Looking ahead to 2017, how do you foresee this momentum being maintained? The 2016 Games were great, with women winning a record 46% of all 77

Team GB medals at Rio 2016, making up 43% of the team, a success exceeded by Paralympics GB where female athletes won almost twice as many gold medals as men. And with the Women’s Cricket World Cup, the World Athletics Championship, and the World Netball and Hockey Championships all taking place in the UK in the next three years, there’s a great opportunity to showcase the best of women’s sport and also fill the venues – as the saying goes, you can’t be it if you can’t see it. Should we treat women’s sport just like men’s sport? Or does it mean something different? Women’s sport absolutely justifies the same level of interest from media and sponsors as men’s sport. Women in Sport regularly analyse the market and trends in women’s sport, and produce a regular insight pack on the state of play. Their latest report showed that 66% of sports fans (male and female) think that sponsors should be involved in women’s sport, and 53% think that women’s sport is just as exciting to watch as men’s. Yet the reality belies the interest – women’s football sponsorship for example, accounts for just 4% of the total football market. Y Sport forecast that this will equate to 5-10% of the total over the next four-year commercial cycle. We need to start playing by different rules in our approach to sport for women. What value can women’s sports provide brand sponsors? What is the business case for investment? I would be approaching the assessment of a business case for women’s sport sponsorship in much the same way as 78

I would any sponsorship – with a clear statement of ambition, objectives, strategy and leverage. The primary difference is the fact that there are, I believe, greater opportunities in women’s sport than exist in men’s – competitive advantage and cut through are more easily achievable, with the right strategy and plan in place. In your lifetime, what are the significant changes you think will be made, or will they? I wish I could say that there will be transformational change in the sector over the next 10 years. As it stands, progress is slow. Three steps forward and two back, too often. However, we’ll start to appreciate more the value of women’s sport – to women, from a participation perspective and user experience point of view, to brands, as a valuable and profitable route through which to grow consideration and drive business, to media (however defined), as a point of competitive advantage. It’s great to be a part of the movement!

THE BIG TAKEOUT 66% of sports fans (male and female) think that sponsors should be involved in women’s sport, and 53% think that women’s sport is just as exciting to watch as men’s, but sponsorship in the sector is peanuts in comparison with men’s sport. These undervalued assets represent a huge opportunity for brands to cut through.

/ DO THE RIGHT THING

IT'S SPORT, IT'S BUSINESS AND ITâ&#x20AC;&#x2122;S GOT TO MAKE A DIFFERENCE

JAIMIE FULLER

EXECUTIVE CHAIRMAN SKINS

@jaimiefuller 80

/ DO THE RIGHT THING

What is sport about in our ‘post-fact’ They have increased their investment in social responsibility; educated world? their workforce about how to identify In recent years, as sport consumers, problems across the industry; developed we’ve been assailed by news of corrup- a new set of employment standards tion, bribery, malfeasance and cheating. for migrant workers; and are educating their suppliers and brokers about an ‘It’s all about money,’ we’re told. ‘It’s acceptable level of recruitment and just business.’ employment practices. But hang on, that’s not all sport is about. But real change doesn’t deliver a quick ‘win’. Patagonia will stay the course A renowned sports ethics It’s one thing to run a business, make because making a difference is what campaigner (“the Bob Geldof money, employ people, sponsor teams, their brand is all about. of Sport”) and executive athletes or events; it’s quite another to chairman of the compression support sporting bodies or individuals For me, it’s a great example of a wear company SKINS, Jaimie whose business is conducted inappro- corporate trying to make a difference is a frequent commentator on priately. – and it’s where I believe sports brands integrity in sport and sports should be heading. It’s certainly where governance issues. He has It’s also the case that, as a business, we’re heading with SKINS. challenged professional sports you can’t be responsible for every part bodies from football to cycling, of your supply chain. It is why we launched anti-doping and and is an ambassador for the governance campaigns in relation to Investec Private Banking Restless For example, one of the most ethical cycling, athletics and cricket. It is why Spirits Campaign. He blogs companies around, Patagonia, found we campaigned against anti-LGBTI regularly at multiple instances of exploitation laws in Russia during Sochi. It’s why we www.watercooler.skins.net through human trafficking and forced declared ourselves as the first ‘Official labour in their second and third tier Non-Sponsor’ of FIFA. It is why we’ve supply chain. worked with civil society organisations in relation to anti-homophobia in sport. The difference between Patagonia and other brands? First that they found this As brands, as sponsors, we should be out through their own internal audit. calling out bad sport, and leading the Second, that they didn’t try to hide way on making it right. it. And third, five years later, they are still working to do something about it. Sport is too important to society not to do so. It’s a way of influencing children Patagonia is working with relevant and demonstrating great values such as NGOs and government authorities to fair play, integrity, discipline, inclusivity, improve the working lives of people hard work, teamwork, commitment and involved in making their products. pure competition. 81

Corporate values such as ‘business integrity’ and ‘human rights’ – which so many corporates share - are just words if, for example, the organisation you sponsor is described by the US and Swiss Attorneys-General as a “mafia-style organisation”, or if you’re not prepared to stand-up when an event you sponsor is being hosted by a nation that throws LGBTI people in jail, or which has no respect for workers’ rights. Many say we only do this to expose the SKINS brand. Yes, it does have a positive impact from a brand perspective and isn’t that great? But those who criticise also miss the point. People who play sport and love sport want it. Whilst sponsors who live in a ‘post-fact’ world may want us to focus exclusively on the thrills and spills of a tournament or the exhilarating feat of an individual athlete, people who follow sport are more knowledgeable, more demanding, more organised and more vocal than ever before. The platform is set for all brands (not just sportswear ones) to combine a genuine desire to do something good with the opportunity to market and grow their brands. Something tells me this is beginning to trend.

THE BIG TAKEOUT Brand sponsors have a duty to call out bad sport, particularly if they want to stay true to their corporate values and those of sport in general. With sports fans behind them, sponsors have an opportunity to do something good while promoting their brands.

/ DO THE RIGHT THING

THANK

YOU!

A huge thank you to our host of industry experts who took the time to share their smarts, insights and predictions for 2017. In the spirit of keeping sports at the heart of our Trends, “well played” to our editorial team: Julia Feldman, Fredda Hurwitz and Rebecca Anstey from Havas Sports & Entertainment Global. Another edition “slam-dunked” and “at the back of the net.” Finally, “great game” (okay, okay we’ll stop…) to Anne Awad, our designer who brought this year’s vibrant, punchy and eye-catching edition to life.

Time for the “final whistle” (sorry couldn’t resist). Thanks for taking the time to read our 2017 edition of Trends. We hope that our look towards the future has inspired you and perhaps made you think differently about the year to come. Any thoughts, suggestions or recommendations? Get in touch with Julia Feldman, Global Marketing & Communications Manager: julia.feldman@havas-se.com

FIND OUT

www.havas-se.com

@Havas_SE