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Episode 133

How to Capitalize on Live Sports Season

Over the next few years, the US is hosting global sporting events unlike anything we've seen before. The FIFA World Cup, LA Olympics, and ongoing NFL season create massive opportunities for brands to connect with audiences.

This week, Elena, Angela, and Rob break down live sports advertising strategy. Learn why sports should be the seasoning, not the meal, and how to balance premium pricing with reach efficiency across today's fragmented media landscape.

Topics Covered

• [02:00] How sports buying has changed since 2000

• [08:00] Using sports as a surgical reach engine

• [10:00] Why co-viewing makes sports valuable but risky

• [14:00] TV spots versus sponsorships and activations

• [22:00] Risks of over-concentrating in sports

• [24:00] Planning for long-term sports effectiveness

Resources:

2024 AdvertisingWeek Article

Today's Hosts

Elena Jasper

Chief Marketing Officer

Rob DeMars

Chief Product Architect

Angela Voss

Chief Executive Officer

Transcript

Angela: That might be the reason that sports sponsorships events look appealing because they're more evenly priced. If you're not buying efficiently.

Elena: Hello and welcome to the Marketing Architects, a research first podcast dedicated to answering your toughest marketing questions. I'm Elena Jasper on the marketing team here at Marketing Architects, and I'm joined by my co-host Angela Voss, the CEO of Marketing Architects. And Rob DeMars, the Chief Product Architect at Misfits and Machines.

Rob: Hello.

Angela: Hello.

Elena: We're back with our thoughts on some recent marketing news, always trying to root our opinions and data research and what drives business results. Today we're talking about the best remaining opportunity maybe for brands to capture a massive amount of eyeballs and attention at the same time, live sports. How should brands think about making the most of live sports? What are the highest value opportunities and more? And I chose an advertising week article to kick us off today. This is titled America's Golden Era of Live Sports. Why brands need to think bigger and smarter. This is by Robin Lichlitter. Over the next few years, the US is hosting a lineup of global sporting events, unlike anything we've seen before. Think the FIFA World Cup, the Las Vegas Grand Prix, the LA Olympics, of course, and staples that are continuing like the US Open. Live sports are cultural landmarks. They spark passion. They offer a stage to connect with massive diverse audiences in meaningful ways, and fans don't just wanna watch anymore. They wanna be part of the action. We've been seeing brands lean more into AR and VR and these big participatory experiences. One example being the Michelob Ultra's fan zones at Copa America. And it's not just about the big tent pole events either. Smaller activations, community impact, and authentic storytelling can be just as powerful even for brands without Olympic sized budgets. So the big takeaway here is that we are in a golden era of live sports and it's wide open. Yes, it might be crowded, but that just raises the bar for creativity. The brands that think differently, stay agile and tie their strategies to both the cultural moment and the long-term fan relationship are the ones that are going to win. There's a lot we could talk about with live sports, but I thought we should start with TV because that's probably the biggest advertising opportunity here. And we have this personal expertise obviously 'cause we're a TV agency. So Ange, this is not an easy question, but could you please break down what buying live sports on TV looks like today? I know we've got these rights split across linear streaming platforms, all these different networks. So how should brands think about the fragmentation?

Angela: It's a bit of a mess. Much more complex. It's crazy to say that the year 2000 was 25 years ago. Can you guys believe that? Like 25 years? That just sounds, it's crazy. Wow. But back in 2000 you had a couple... You had one Nielsen currency, which meant you could do some quick cost per point math, you could buy in the upfronts and just fill in with scatter. Today the same leagues are split across broadcast cable. You've got skinny bundles, you've got multiple streamers. You've got exclusives like Thursday night football on Amazon. Peacock only playoff games, Christmas games on Netflix, like there's no one-stop shop anymore. And so you have to stitch together people level, reach across walled gardens and much more. And then on top of that, we don't have one currency anymore, right? Nielsen now sits alongside iSpot, Video Amp and comScore, all with slightly different rules for counting and co-viewing. The plumbing matters. In streaming, the way ads get inserted and IDs get passed mean you need tighter standards, fraud controls on frequency. So the job isn't just buy the game anymore. It's like this portfolio approach and really thinking through the systems to deliver those impressions. Secure rights across platforms. Insist on co-viewing aware persons level reporting, harmonize all these currencies. Police, the ad tech. It's much, much more complex than it has ever been.

Rob: Was it easier to measure the effectiveness of live sports back in 2000 when it was only a couple channels and Nielsen or with all the precision that we have now with technology, is it are we more precise now that we have so much more plugged in or was it actually better back in the olden days?

Angela: Yeah. Well I think we're gonna get into it a little bit, but how many marketers do you think back in 2000 were even trying to measure the impact of something like live sports? In the marketing ecosystem, we think we're better at measuring marketing in general. Things like television, ACR, IP, et cetera, streaming versus linear. But we've also talked about the complexities of that as well, and ensuring incrementality, which is really the name of the game when it comes to live sports is incrementality.

Elena: Did you happen to look into what platforms own what? We don't have to share. I just think it's crazy like how you've got like Amazon, like it's like the other day trying to watch a football game. Sam and I were like, where is it? Like we checked, thought it was on Hulu. We checked Peacock and then finally we found it on Amazon Prime. But like it's all split up in such a, and that affects advertisers because there's different ways of buying from all these different places.

Angela: Yeah, absolutely. If you go across the NFL, the NBA, the MLB, the NHL, the MLS, you've got college football, NCAA Olympics tennis, golf, NASCAR, et cetera. Before when you look back 25 years ago, you had maybe three or four major players, but now there's closer to 15 to 20 players. It's hard to even find it, to your point, much less buy it. I don't know if you want me to go into like everything. It would be extensive.

Elena: Yeah. It's just complicated. Probably only for us honestly, but awesome. So you mentioned Ange some of streaming changing things and measurement being difficult, but how do you think advertisers should think about that? Like measuring live sports? Do we need new metrics? Like how do we make sure we're measuring the impact when everything's gotten so fragmented?

Angela: So streaming has pushed live sports measurement from being panel only estimates to more hybrid kind of log level systems that are trying to resolve people versus devices, right? And then we need to dedupe linear and CTV too. So currencies are fusing first party streaming logs with big TV data and a calibration panel so that co-viewing on the big screen can be modeled in. And the market is, like I said before, just gone multicurrency. You've got Nielsen's MRC accredited big data panel alongside alternatives like iSpot, Video Amp, comScore. For YouTube on CTV, specifically Nielsen one ads includes co-viewing. So you can compare on a persona basis. So do we need new metrics? I think so. But frankly, as I was mentioning before, I don't really think that tentpole advertising has had the analytic rigor it's needed possibly ever broadly. Anyway, we've talked about this before. Why do advertisers pay $70 million for a Super Bowl spot? How many of those marketers are quantifying the impact to the bottom line? It's hard, and it's never exact. But if we're saying yes, because we just want to see ourselves next to Doritos and Coors Light, that's not the rigor the marketers should have these days either.

Elena: Well, speaking of this being expensive, thinking about live sports as an investment in general, they are very expensive, but brands are often really interested in them because it's a big opportunity for a lot of viewership. There's prestige that comes with it. Sometimes it's because your executive team watches sports, so you want them to see your brand. Like there's, I think this feeling of, yes, it's pricey, but I need to be there. So how do you think brands should think about balancing the premium cost of it compared to the effectiveness that sports delivers, even compared to other programming that might be less expensive, but taken together could have a similar type of reach? How should we think about that?

Angela: So if you're building brand reach, make your north star that person level, incremental reach across linear and streaming. If you're looking at it for more of a performance angle, then are you getting incremental lift in terms of visits, in terms of sales, and often in order to do this effectively, because these events do have the ability to drive a pretty impactful kind of halo impact to the organization. You're often needing to test into it with either geo test holdouts to better understand. If I go out there and I push some Emmy advertising out there, what happens to my digital marketing? What happens to my direct mail campaigns? We like to look at these events as, okay, there's prestige in it, maybe. Maybe there is, but how are you quantifying that? That's the rigor side of it that I think ahead of doing major sporting events, something like a Super Bowl, you get a sense of what type of incremental gain and incremental gain could be a lot of things. It could be sales focused, it could be reach focused. It could be that you're looking for incremental lift in terms of investor awareness. That might make sense depending on what you're trying to do as a business. Are you operating, trying to move towards a sale? But just going into those events without having a sense of what you're going to get in return too is to me often, I think what happens. I think we need more focus in terms of rigor and measurement.

Elena: One of the great things about TV is it can do multiple things. So you don't have to be results focused. You mentioned co-viewing in your answer, which is something that comes up a lot when marketers think about the value of live sports. It's actually something that I think makes TV so effective. The fact that when you're watching TV, you're often surrounded by other people. Is that something that you think marketers should actively plan around when they're valuing live sports or when they're planning on like, how much should I invest on live sports?

Angela: I mean, co-viewing is a big part of why live sports can be potentially worth a premium, right? One ad often equals multiple people on a big screen, so your effective person CPM drops and your incremental reach climbs, especially during the tentpoles when something like a watch party head counts spike, so that's the upside. The downside is concentration. The same households host the big games sometimes, so you can hit kind of household frequency limits faster, even while adding people. In other words, co viewing makes sports both cheaper per person but also sort of riskier per household. So we do need to plan around it. Price and report on persons, not devices, insist on co-viewing aware currency or apply a conservative multiplier and optimize to that. Again, cost per incremental reach point. We wanna cap frequencies at the household level on tentpoles. Still use that lower CPM shoulder or non-sports inventory to be efficient and effective across your entire marketing plan. I think a quick rule of thumb to be thinking of is if we have a $40 household CPM game that maybe averages 1.6 viewers and meets your quality bar, then your person CPM is 25, which is a lot more manageable for brands. If it's adding new people, if it isn't, then shift that budget back to cheaper kind of base load programming to keep the growth math on your side.

Elena: That makes sense. So co-viewing, there's a lot of upsides to it, but a downside might be similar to just, if you only invest in live sports. You might be hitting the same people over and over and over and paying a premium for that.

Angela: Totally. It's like Rob if you have, let's see, what food works for Rob? A food analogy.

Rob: Food works.

Angela: Okay. Okay. What's your favorite food that you, just like what? What's your treat food that you really love to eat?

Rob: Oh, I love Cheez-Its.

Angela: Okay. I don't know if that one works.

Rob: That's out of food?

Angela: No, it is a food, but you know, I don't, treats are cheap in your house. I was thinking it's more of like a special Chicago treat, but like, say you had a, okay.

Elena: You look like a Cheez-It right now with your orange shirt.

Rob: I do. I'm very orange. I mean, just that wonderful red box, you know, when you get it, especially the family size. You know, where they actually have two bags packed into one box. It's just like you have your little backup Cheez-It pack built in.

Angela: I was thinking more like, I know you like the White Castle burgers, which on a cost per burger basis, they're pretty low. 'Cause you get the box.

Rob: We get the Crave Case.

Angela: The Crave Case. Sorry, yes. Whatever. It's a handle.

Rob: Okay.

Angela: And yet, a delicacy burger is also very yummy. But maybe you're willing to pay more infrequently for that delicacy burger, but you don't, that burger might cost $30. You wanna go pay $30 for every White Castle burger?

Rob: But I actually do pay more for the White Castle. Just not with money.

Angela: Oh gosh. Okay. Well, we don't wanna go into that.

Rob: Okay.

Angela: All right. I'm not sure I helped us with the food analogy. Honestly, I think we probably lost some people, some listeners just in general.

Elena: Well, let's pivot because we've talked a lot about TV because that's our bread and butter makes sense. But there's obviously a lot of other ways a brand could work with a sports team. There's different sponsorships you can do. You can be the main team sponsor. You can be on jerseys, you can be in the stadium. You can do experiential activations like fan zones, branded integrations. You could work with athletes, like there's so many ways to be involved with life sports. How do we think that stacks up against this traditional 30-second TV spot in terms of effectiveness? I know we're biased, but try to be a little objective here.

Angela: Yeah. It's an interesting question 'cause people get really connected to these sponsorship opportunities. Sometimes they've been doing them for years and you're sort of like, gosh, what happens if I walk away from something like this? So I think the short answer is from our experience, a well executed 30-second TV campaign is gonna win every time. Now, how do people get confused in the sponsorship versus something like a 30-second campaign and the trade-offs between the two. If you're running 30-second TV campaigns already at $30 CPMs, then A, you're not buying well, you're leaving a lot of sales on the table, and B, that might be the reason that sports sponsorships events look appealing because they're more evenly priced. If you're not today buying efficiently so that, it's not as big of a cost trade off. We have clients asking us all the time, is the sponsorship we've done for years worth it and have unfortunately never come across a package that felt like it made good investment sense. A 30-second TV spot buys controllable, scalable persons level reach at lower knowable costs. You choose the games, you can choose the pod, the flighting, you can cap frequency, you can de-dupe. Sponsorships and fan activations can maybe build meaning, connection, perhaps bring some local love to a brand with a local sponsorship or something like that. And again, there might be other reasons that makes sense to do just based on what the business is trying to do. But they're volatile. They're really hard to measure and on a reach basis, they usually carry kind of a logo tax that, like I said, is typically hard to justify.

Rob: I do love a good activation. As you guys know, sports for me is watching The Bachelor, but I was at a major sporting event here in Minnesota recently called the Minnesota State Fair, which is basically a large competitive eating contest of how many deep fried snicker bars that you can consume. And I was walking down a corner of the fair and there was a line going around the block and they were all going to the State Farm booth. And I'm like, what in the world is State Farm doing to generate? Because you'd never see that kind of excitement for a State Farm booth. I'm sorry, it's just not one of those things you normally think you'd see a big line for. And they were making personalized bobblehead dolls for free. You could go in there, they would make you a bobblehead doll. And then those were sharing them online, of course, 'cause they're just charming as heck. There was press covering it. There's just that compound interest that an activation can get. I think it's probably right at the end of the day. Angela's got the data to support it, but it sure is fun to see those activations do their thing when they work and just kind of bring that community together around your brand.

Elena: I agree with you Rob. I think we've mentioned this before on the pod, but in my mind, if you're a brand that's spending millions upon millions on activations and not on TV, that feels like the wrong order. But if you're State Farm with that TV reach is so important, then like the incremental rage, a different type of connection with a customer, then I think it makes total sense as long as you've got this sort of coverage because you're only gonna be hitting Minnesota State Fair people, versus when State Farm runs in an NFL primetime game they're hitting the whole country. So it feels like a good thing to add and it can add different value on top of something like TV.

Rob: And let's be real, those bobbleheads are not free. My guess is you gave them your email address, so you've paid for that bobblehead.

Elena: You're gonna be getting a call from State Farm, actually one a day for the next 10 years. Yes.

Rob: Exactly.

Elena: They're gonna hit you up. Well, speaking of things that are expensive, not every brand, in fact, few brands in reality can afford something like the Super Bowl for live sports. But Rob, what lessons do you think any brand could still learn from these sort of big campaigns that they can then apply at smaller scales?

Rob: Absolutely. Obviously the Super Bowl is the Oscars of TV advertising, but there's just those great principles that you can feel in the majority of those ads. One is be simple and sticky. You make the idea clear. Make it simple. It's a crowded place. It's not the time to talk about all your features and benefits. Be simple. Be sticky. That's one. Two, this is a cultural opportunity, right? When you're on television. So tap into the culture, you know, is it a celebrity cameo if you have the money, or is there just a big trend called trend jacking that you could be tapping into in your campaign. And then of course, using the universal emotion as well. And then third is just good old fashioned reward the attention. People watch commercials 'cause they feel like they get some talk value, there's some humor, there's some emotion. So humor, surprise, winning the heart are all just great things that most spots try to deliver on. I think a really good example is, and it's a classic one, but if you think about the old Poo-Pourri TV spot, not a Super Bowl commercial, but it really hit all of those. Simple and sticky, a woman in the bathroom covering up an uncomfortable moment. Culturally tapped in, you're culturally connected to the taboo of talking about the smell of poop. And of course you're rewarding attention 'cause hey, who doesn't want to talk about that commercial. So you can see well done commercials outside of the Super Bowl that still hit on those three themes.

Elena: Well, speaking of cultural moments, sports create those times, right? Where people are watching them together, it causes conversation. And one thing I've noticed when you're watching a big sport event, even think the Super Bowl, but even just a general NFL game, some brands seem to lean into incorporating the moment more. Like I'm thinking about in this past Super Bowl. Duracell had a really funny spot with Tom Brady where it just was perfectly timed. We've seen that before where it seems like it's really in line with the content you're watching versus other brands like Budweiser. They've stuck with the Clydesdales for years and it's not necessarily related to football or that moment, but they've stayed consistent. Rob, how important do you think timing and context is when you're thinking about your creative strategy and you're gonna run an ad in live sports, like should you think about creating something new? Should you stick to your normal distinctive creative? What do you think?

Rob: Gosh. This is one where I'm an expert in my opinion because I think you can make a compelling case for both leaning into the timing and into the context, especially if you have the money to create unique assets or should you stick to just focus on the strategy that you already have? My personal opinion is to stick to your guns and really double down on the distinctive assets that you've already generated for your brand. I saw that, and this is obviously you guys already know about, but Nielsen talking about how live sporting events have 20 to 30% higher ad recall than your average programming, so that's your distinctive assets in action and burn the calories that you're asking on your brand versus trend jacking something that might be super relevant and timely but not necessarily as connected to your brand.

Elena: So we love live sports 'cause we're a TV agency. A lot of viewership goes to live sports. But sometimes I think we see some brands who, when they go to invest in TV, they're actually only looking at live sports. It kinda makes sense. Prestigious moment. Lots of viewership. But we just talked about there's all these benefits to being there, but are there risks to leaning too heavily into sports as a channel? How could a brand prevent themselves from over concentrating their spend there or maybe missing other opportunities?

Angela: Yeah, I think the risk is you're gonna overpay to hit the same people. You run into scarcity and price spikes and miss that more efficient reach sitting in the rest of the TV environment. We watch a lot as TV viewers, so just being smart about how we get in front of the right eyeballs. Those big games also concentrate risk. Schedule shifts, maybe ratings variance, and co-viewing can kind of mask household over frequency, even as person reach might look good. You can spend a lot without adding enough new people. I think the fix is to make sports the seasoning not the meal. I think we've used that before. I can't remember in what context, but building that weekly reach with low CPM base load programming across the ecosystem. And then use these tentpole events to attain those light TV viewers. And that's really the smart way to think about it.

Rob: I am a sales person's dream. I will buy anything and everything and I'll usually buy two of it. I am not watching sports, so while you might be double downing on all of your television stuff, you're not reaching me. And my guess is I am not the only person in the United States that does not watch sports. So yeah, lean too heavily in there, and you're not gonna get me to buy your product three times.

Elena: Rob's the Rob opportunity, which is a big opportunity.

Angela: A big opportunity.

Rob: The Rob opportunity.

Elena: My gosh. Well, let's pivot because the article that we opened with talked about how we're in this golden era for live sports. I would agree. Annually we have big sporting events. Obviously the Super Bowl comes around every year. We talked about stuff like the US Open. However, there's also big events coming up. We've got the Olympics here in the United States in 2028. The World Cup is gonna be one of the games that's hosted here next year. And there's this ongoing popularity of these sports leagues. So what do we think marketers should do now to plan for long-term effectiveness in their live sports purchases?

Angela: Yeah. I would say, how do you just take a minute and zoom out before we zoom in and go, oh, I want this buy or that buy and I want this rate or that rate. Let's zoom out and think about marketing effectiveness. Okay. Mental availability, physical availability. We'll set that one aside. Distinctive assets, light buyers. All major principles for growth, and if we're gonna invest in something like the Olympics or the World Cup, certainly we're trying to drive growth. So when we think about light buyers and light viewers, these are great opportunities. When we think about mental availability, you probably have, if you're thinking about doing something like the Olympics or the World Cup, you probably have mental availability with a set of consumers already. They know who you are. Who are maybe the segments or the fringe audiences, secondary, tertiary audiences that really represent some growth opportunity that you don't have mental availability with. Otherwise I think we end up doing things like, gosh, we're a brand that targets men 25 to 54, so we go buy the NASCAR. Okay. Maybe, but are there fringe opportunities with audiences that we think have growth potential that might push us towards something maybe more like US gymnastics? I don't know. But let's think of the most efficient ways and who we wanna be targeting before we go into planning season. Then I think we need to plan like a cost first reach machine. Talked about this a little bit already, but you know how to use this type of programming on an ongoing basis. Let's get some data now using incremental geo tests around tentpoles and shoulder windows to quantify that direct and that halo impact across site, app, search, retail, et cetera, so that when we get into decision making mode on events that are going to potentially cost millions and millions of dollars, we're operating from a proven playbook, or at least some data in that space. Let's go there. Maybe it's not proven yet.

Rob: That was incredible. I have nothing to add except for maybe think about advertising on The Bachelor too. Just a little live finale. That's live sports.

Angela: For Rob.

Rob: Live finale, live sports.

Elena: That's your thing.

Rob: That's literally all I got.

Elena: Okay. I knew this episode was gonna be tough for Rob, so I'm just...

Rob: I like that was so freaking good. Whatever Angela just said there was awesome.

Elena: Alright, let's wrap up with something kind of fun. What is our most contrarian sports take? And you can interpret us.

Angela: I'm so curious what Rob's most contrarian sports take is. Mine is watching at home is way more fun than watching in person. That's not because I want everyone watching TV, which of course I do. But no, last year and we're gonna go to another one. I do love the Vikings. I'm a true Vikings fan. I'm not a fair-weather fan, and we went to a Vikings Bears game last year and it was my first time in US Bank Stadium. And it's amazing. It's gorgeous. There's an energy, and at the same time I was like, I miss the announcers, and I really wanna just get up and walk to the fridge and grab a snack and stuff.

Elena: It's even hard to see in person.

Angela: It is. It is.

Elena: It's hard to see what's happening.

Rob: All right. For me, okay. If you're gonna build a sports stadium of any kind and you're using taxpayer dollars. It should also be an amazing venue for us non-sports people for like rock concerts and they should have really great acoustics. And I am looking at you, US Bank Stadium. I'm sorry, but that monstrosity, which I know is beautiful and can is great for Vikings games or whatever. It is a horrible place to see a concert unless you want to hear Bono singing three times the same thing 'cause of the echo. It is just terrible. So that's my contrarian view. If you're gonna build a sports stadium, it should add value beyond just being a sports stadium.

Elena: I would agree with that. Seeing a concert in US Bank is a rough time. Also as a Packers fan who's gone to that stadium to watch the Vikings and Packers play, it makes that Viking noise so loud. It's like echoing, you know what I'm talking about, like the horn thing that they do. Oh man. All right. My contrarian take is that track and field is one of the most exciting sports to watch. If you haven't watched track and field, you might only tune in the Olympics, but there are year round track and field races. There's even indoor races, which are really fun 'cause the tracks are even smaller. So there's like closer packs and it's really fun to watch everything from like the even the 10,000 to the mile to the hurdles. There's drama, there's beef with a lot of these sprinters and these athletes. This will be done by the time this episode's released, but you can go back and watch. It's the World Championships in Tokyo right now for track and field and just other running sports in general. They're really fun to watch. If you don't watch track, try it out. And they're short too. So you just wanna watch them on YouTube or just tune in for a second. They're not big three hour events. You can just tune in to watch certain races.

Rob: I will definitely be sure not to watch that.

Elena: Well, I'm not gonna have my feelings hurt 'cause you don't watch anything related to sports. So that's fine. We will be...

Rob: I do to watch sports. What are you about?

Elena: Oh, okay.

Rob: Oh, okay. I will say this. Netflix has done a really good job with their different series, like Quarterback. Like I actually watched that and it didn't have the sports in it, it just had the people and I really enjoyed it. I learned about Kirk Cousins who was the Vikings quarterback. His journey was really interesting, so I did enjoy that. And Brad Pitt got me into F1 a little bit with that movie so I watched a little bit of the F1 Netflix series and I'm like, this is really exciting. Maybe I'd actually watch one of those, but probably not. They just sit there and they go around for so long, but when you can cut to the chase, no pun intended. Some pretty good stuff there. And talk about sponsorships. Jeepers, they've sponsored every square inch of those cars and everything else, like, geez. That's some money.

Elena: Yep. Yeah. They figured out how to monetize that pretty effectively, it seems. Alright. Perfect. Well, I think that wraps us up.