In the vital need of connecting to a disengaged young generation, football brands are transforming into entertainment hubs.
Data and content are becoming strategic pillars of worldwide clubs, leagues and federations. An investment to not only offer personalised digital assets but also to create a relevant source of income.
But, what does it take to become the ‘Netflix of football’?
According to Reed Hastings, cofounder and co-CEO of Netflix, “we fundamentally want to be better at creating stories people want to talk about and watch than any of our competitors”.
Among other clubs, AC Milan also announced a multi-million-euro investment on content through The Studios: Milan Media House. A self-owned media division with 1,000 square meters of space, high-end technology including 4k camera and a team of 40 production and creative professionals.
Does it make sense for everyone to offer content through an OTT?
Why video on-demand matters
Football is missing a whole generation aged from 16 to 24 years old, two out of give from them simply don’t care about football. The attention span is decreasing, the most popular sport in the world needs to entertain and inspire more than ever.
Video on demand (VoD) not only represents a Direct-to-Consumer (D2C) opportunity for tailor-made fan experience but is also the second biggest market in Digital Media after Video Games, with a market size of $72.5 billion in growing at a CAGR of 10.6% until 2025.
United States, Europe and China account for almost 80% of the global VoD market, being video streaming the top driver and China the fastest-growing industry with a CAGR of 17.9% up to 2025. Exploring the Chinese platform Weibo and TikTok has helped Juventus to grow followers by 320% since 2017.
Following KPMG, it’s no coincidence that the NBA leads the ranking of the most popular sports competitions on social channels with 200M followers, with a strong fan base in Asia where the microblogging website Weibo alone gathers more than 22% of them.
Netflix lessons for football
Adding almost as many customers in the first six months of 2020 than in all of 2019, extending to nearly 200M subscribers in 190 countries, growing sales up 25% a year and becoming the 7th largest internet company by market capitalization with $239 billion, Netflix is the absolute benchmark for entertainment.
One of the reasons for leading the subscription video-on-demand segment worth more than $70 billion has been producing own film and TV series under the label “Netflix Original” since 2013. Keeping their core asset in-house allowed the Californian firm to increase Original productions by 50% from 2018 to 2019.
Content licenses and the production of own series have not prevented Netflix to adapt to each market. While prices have been raised in the US and “Ultra” plan has been added, the company also reacts to country-specific habits. For example, by offering a mobile-only plan at a lower price in some Asian regions.
In Hasting’s book No Rules Rules, Netflix management culture is identified with a professional sports team. Star employees paid and expected to perform like stars. A team of elite players trusting one another’s exceptional skills through brutal transparency and huge amount of autonomy.
Not for everyone
The fact that top rights holders like LaLiga, FC Barcelona, UEFA, the NBA or F1 are developing their own OTT platforms doesn’t mean all sports stakeholders should do the same. Actually, if we design fan-centric models, then fans’ interests and behaviour should ultimately drive decision-making.
Only building the necessary structure and resources is challenging, and if it’s not a product so scalable and unique that fans will crave to own, then offering an average experience it’s not neither worthy nor profitable.
How will rights holders be able to exceed expectations?
Data, creativity and technology.
Focusing on enriching fans’ share of wallet and on addressing niche segments with premium content will become key for the vast majority of stakeholders far from elite football organizations. A game where piracy needs to be seriously tackled to avoid missing out on up to $28 billion a year.
There is no need to become Netflix, but it’s fundamental to entertain like them.