The Monetisation Challenge
OTT channels have been a staple of the fan experience for well over a decade. From Goliaths like “LFCTVGO” to smaller offerings like FC Halifax Town’s “Shaymen’s Player”, they share similar goals:
• to engage with the clubs’ loyal fan-base that turn out as the digital 12th man week-in-week-out
• to reach dedicated followers who can’t always attend matches.
In the increasingly commercial world of sport, engagement isn’t always enough to keep the lights on. A cohesive monetisation strategy for content lets clubs match fan engagement with a healthy balance sheet.
There are many ways to generate revenue from content. Here are my (personal!) two cents on monetisation.
Subscription Video on Demand (SVOD)
The grandfather of content monetisation, offering a tried and tested way to generate income for football TV services. With enough fans and a strong pricing strategy, SVOD can return a healthy yield. But, with ample competition, not just from SVOD, content needs to be strong and unique.
The most obvious downside of SVOD services is potential alienation. When only the upper echelons of the fan base engage with the majority of club content, it can create a somewhat us and them feel. In a world where fan togetherness is a key selling point of the experience, this could be detrimental to the long-term commercial goals of the club. With that said, it’s still a proven revenue generation tool.
Advertising now plays a key part of our modern day lives. It seems we can’t go 5 minutes without seeing a tailored advert online and football video services are no different.
In this VAST (Video Ad Serving Template) based world, advertisers can target specific users and their likes and dislikes. This leads to some of the market’s highest CPM (cost per 1000 adverts delivered) values.
It all sounds great. Engaged fans see exactly what the advertiser wants, with access to all their club’s content. Well, yes and no.
If all content is completely free, it reaches more eyeballs and generates more revenue without alienating the fan base. On the flip side, the two key metrics that define revenue from advertising revenue are fill rates (ad spots delivered) and number of views.
Football clubs have many partners and sponsors, meaning exclusion policies are deep and complex. This makes it hard to fill the inventory offered to an advertiser leading to either minimal returns/fill rates, or worse: the same un-skippable advert on repeat, driving fans completely mad.
We all know gambling is big business and this is no truer than in the world of football. The prevalence of in-play betting and cash out services has exceeded in-game betting so cover a huge percentage of football bets within the sector.
Football TV services can benefit from the boom by utilising affiliate betting programmes. Clubs can add betting calls to action to live or VOD players, receiving some of the bet itself. This method is simple and effective, but very event specific and time-based, limiting potential revenue.
The holy grail of sports monetisation. Clubs simply package up their full TV service inventory under one sponsorship offering. It’s a win-win:
• fans receive all content for free
• clubs keep a guaranteed sponsorship income
• and sponsors engage direct with their target market.
So what does the sponsor get in return for their investment? At the very least, key touchpoints that include:
• Logo within control bars, allowing for a strong brand experience
• Branding takeover of player elements
• Overlay advertisements
• Watermarking of branded content
• Bumper content – Append each video with a short 2/3 second sting
• Sponsored content – TV content made to grant exposure to the sponsor
By keeping sponsorship to a branded player, it allows a fan blanket access to all content, without 20-second long adverts before each video.
Clubs can segment content into different content groups for sponsors to buy support for. For example, if Sponsor X brings you match highlights, Sponsor Y can bring you live audio commentary. In this way the club can begin to package video inventory in the same way as more traditional advertising board or shirt sponsorship sales. It is sometimes hard to assess the value of sponsorship, so often clubs loop this inventory into existing deals.
Sponsors are key partners of any football club and video is the most engaging piece of digital content on offer. These two should simply go hand in hand.
The age-old battle of media officer vs commercial director… “Why not just deliver video for free?” As monetisation goes this isn’t a completely far-fetched idea. Video still has a tangible return for the club whilst also serving some of the more important business goals – bums on seats, hospitality and merchandising to name a subset.
The only downside to this model is quantifying said value. How can you be sure the content is engaging with the fans in the correct way and leading to up-sell within other business sectors? It’s within the same vein of placing a monetary value on a Twitter or Facebook follower – not easy.
There’s no blanket answer to the successful monetisation of content. A host of crucial factors are in play such as; is the content unique enough? Does the club produce enough content to justify the product? There is solid quantifiable data that subscription and ads generate football webTV revenue, but not much else. The tried and true work, but without granting the more innovative models wings, how can we be sure they can’t fly?
Hybridisation of monetisation methods is a good starting point. For example, if live content is Pay Per View (PPV), a sponsor could support highlights packages while advertising supports all other content.
In short, there are many ways to make money from live and video-on-demand content, but there’s no one size fits all model. For some, fan engagement is key, for others revenue comes first. In reality, the two should co-exist and feed each other’s goals. Let the ongoing battle between the creative and the commercial continue.
Get in touch
If you would like help monetising your online video content, get in touch with StreamAMG to see how we can help. We work with many of Europe’s top club sides, helping teams like yours to get the most out of their online video.