Spotlight On Fantasty Sports

A look at how fantasy sports has changed
the way consumers engage and interact with
sports, and how it has become a high-stakes
opportunity for both fans and brands.
1
MAY 2015
2
1.
THE ADVENT OF
FANTASY SPORTS
The formation and evolution of America’s newest
favorite pastime
2.
HISTORY OF BRAND
INVOLVEMENT
How and why early-adopting brands joined the fantasy
sports movement to shape its future
3.
TODAY’S CONSUMER
MARKETPLACE
The power of fantasy sports to move brands and
products forward
4.
CHANGING THE GAME
How fantasy sports has impacted general consumer
engagement and consumption of sports and live
sporting events
5.
TRENDS
Insights and trends for 2015
6.
KEY TAKEWAYS
Opportunities and takeaways for brands
THE ADVENT
OF FANTASY
SPORTS
Fantasy Sports has been around for over half a century,
with the earliest of iterations credited to former MLB
player Ethan Allen who created the classic board game,
All Star-Baseball in 1941. Featuring a spinner and cards
using real MLB players and their batting averages, this
was a precursor to Strat-O-Matic developed by Bucknell
University mathematics student Hal Richman in his
parents’ Glen Head, NY basement.
The digital age of fantasy sports started in 1960 when
mid-level IBM programmer John Burgeson coded a game
that could only be used on a $120,000 computer.
Burgeson’s version of fantasy baseball put users in
control of a fake team made up of real players that
produced computer-generated outcomes based on the
players quantitative strengths and weaknesses.
In 1963, Wilfred “Bill the Gill” Winkenbach, a limited
partner in the Oakland Raiders, took this idea a step
further on the west coast and developed a Fantasy
Football system and rulebook with Raiders publicist Bill
Tunnel and journalist Scotty Stirling. The enthusiasm
behind their inaugural league of the GOPPPL (Greater
Oakland Professional Pigskin Prognosticators League)
spread throughout California sports bars where groups of
friends formed their own leagues.
In 1980, Fantasy Baseball got a boost when the statistical
concept behind Strat-O-Matic was adapted to use MLB
player stats during the on-going season. Magazine writer
Daniel Okrent created the scoring system and was joined
by friends in New York City restaurant La Rotisserie
Francaise to play the first game over a lunch. Aptly
coined the Rotisserie League, their league was the
inspiration for other “Rotisserie” scoring Fantasy Baseball
leagues including the oldest continuously operating
league since 1981, The Roach Motel League at Columbia
University.
The popularity of Fantasy Baseball and Football
continued to slowly grow; but with the advent of the
Internet in the mid 1990’s came the rapid ascension of
Fantasy Sports.
3
HISTORY OF
BRAND
INVOLVEMENT
FROM A HOBBY
TO BIG BUSINESS
SOME OF THE FIRST
DIGITAL VERSIONS
OF FANTASY SPORTS
WERE BRANDED.
1995
Canada’s Molson Breweries created
a National Hockey League
sanctioned Fantasy Hockey League
as part of its Molson ‘I Am’ Online
website.
1997
Commissioner.com launched a
Fantasy Baseball platform, providing
players with a suite of tools to
manage their league and team,
setting the tone for online fantasy
sports. It was sold for $31 million in
1999 to SportsLine.com and by
2003, Commissioner.com drove $11
million in fantasy revenue for
SportsLine before it was purchased
by CBS to become the fantasy sports
engine behind CBSSports.com.
2008
One of the first daily fantasy sports
sites, SnapDraft, was launched by
NBC as a spin-off from Instant
Fantasy Sports.
4
1996
ESPN SportsZone, which later became ESPN.com, created
three tent pole games for Pizza Hut: Baseball Challenge,
Pigskin Pick’em, and the NCAA Tournament Challenge.
Across all three games, over 327,000 players participated
and registered with their email addresses. An email was sent
to all of those players with a link to a Pizza Hut coupon page,
and 79,000 (24%) clicked to get to the coupon.
1999
The Fantasy Sports Trade Association was founded by
industry powerhouses and emerging game developers as
fantasy sports participation began to reach a critical mass.
2002
Featuring active football players, the NFL promoted
NFL.com Fantasy Football in TV commercials showcasing
player support.
TODAY’S
CONSUMER
MARKETPLACE
OVER 41M PEOPLE PLAYED FANTASY SPORTS
ACROSS NORTH AMERICA IN 2014
Each year, the fantasy-playing population continues to grow exponentially, with over 36 million players in the
US (14% of the population) and 5 million in Canada (12% of population) in 2014.
YEAR
ESTIMATED NUMBER OF PLAYERS
1988
500,000
1992-1994
1–3 million
2003
15.2 million
2004
13.5 million
2005
12.6 million
2006
18 million
2007
19.4 million
2008
29.9 million
2009
28.4 million
2010
32 million
2011
35.9 million
2014
41.5 million
FANTASY SPORTS PLAYER PROFILE
34
AVERAGE AGE
80% MALE
9.51
90% CAUCASIAN
52% NOT MARRIED
78% COLLEGE DEGREE OR MORE
5
YEARS IN FANTASY FOOTBALL
17.89 HOURS CONSUMING SPORTS PER WEEK
8.67
HOURS CONSUMING FANTASY SPORTS
69.4% FOOTBALL (FAVORITE FANTASY SPORT)
TODAY’S
TODAY’S
CONSUMER
CONSUMER
MARKETPLACE
MARKETPLACE
THE FINANCIAL COMMITMENT THAT
CONSUMERS MAKE IN FANTASY
SPORTS IS MORE THAN SUBSTANTIAL –
IT’S MONUMENTAL.
Consumer spending keeps adding up
Fantasy sports has become a $15 billion industry.
Compare that to the real sport of “Pro Football”
where the NFL is a $10 billion industry.
Paying to play
While there is an abundant amount of free fantasy
sports games, over 46% of fantasy players pay an
entry fee to compete - spending an average of $111
per year across league fees, transaction fees,
hosting fees, and prizing fees.
HALF OF FANTASY PLAYERS COMPETE IN TWO TO EIGHT DIFFERENT SPORTS
Fall has traditionally been the busiest time of the fantasy sports year with over three-quarters of all fantasy
players competing in NFL-related games; however, Baseball holds a distant second, seeing a third of fantasy
players. Recently, fantasy racing has overtaken NBA, which has seen a dip in participation in the past year.
77% NFL FOOTBALL
33% MLB BASEBALL
21% NASCAR RACING
20% NBA BASKETBALL
20% COLLEGE FOOTBALL
18% NHL HOCKEY
15% PGA GOLF
12% SOCCER
PASSIONATE & LOYAL AUDIENCE
80%
of today’s players say they plan to participate in fantasy sports for the next decade
40%
say they will continue to play for life.
6
Source: Fantasy Sports Trade Association
TODAY’S
CONSUMER
TODAY’S
MARKETPLACE
CONSUMER
MARKETPLACE
FANTASY SPORTS IS A PRIME PLACE
TO FIND ENGAGED CONSUMERS
Whether it’s because of the financial investment, the camaraderie or the adrenaline rush, fantasy players
commit more time and attention to fantasy sports than they do real sports.
An MEC-commissioned study found that the Fantasy Football fanatic commits more than 17% more
attention to and connects 8% more deeply with Fantasy Football than Football itself, offering marketers and
brands an opportunity to connect with these hard-to-reach consumers. The findings revealed that space
tangential to fantasy sports game content cannot only provide an efficient and cost-effective way to connect,
but it can connect even more deeply with them.
Heavy players pay 33% more attention to Fantasy Football content
than non-players, and 44% more than light players of Fantasy Football.
KEY
FINDINGS:
Trash talking is a common feature of Fantasy Football playing, but heavy
players are far more interested in research strategy. They commit more
than 50% more attention and resources when consuming research
strategy content than to content with trash talking. Furthermore, they
encode 41% more of this content to memory.
FANTASY PLAYERS ARE SPENDING ON MORE
THAN JUST FANTASY LEAGUES
Sports aren’t the only thing occupying fantasy players’ time or wallets as they spend time online shopping and
are more likely than the average U.S. internet user to have shopped online for a number items.
SHOPPED ONLINE IN LAST 30 DAYS
INDEX VS. ONLINE 18+
Beer
149
Cell Phone/Service
157
Clothes/Shoes/Accessories
118
New Credit Card
167
Event Tickets
158
Fitness and Diet Products
139
Home Electronics
160
Insurance
166
Movie Tickets
184
Deodorant
155
Read as: Adult fantasy sports players online are 57% more likely than average U.S. adult online to have shopped
online for cell phones/service
7
Source: Nielsen
CHANGING
CHANGING
THE GAME
GAME
THE
GROWING INTEREST IN FANTASY SPORTS
IS CHANGING THE MEDIA LANDSCAPE
Fantasy players are more engaged with mainstream media than regular sports fans, demonstrating their
interest, attention span and proclivity to spend money in this space.
PLAYERS VORACIOUS APPETITE FOR NEWS
Consumers aren’t just sticking to the site that hosts their fantasy league, they are very active on multiple sites
to ensure they have the most updated and relevant information.
Number of sports news websites that fantasy sports players use to obtain relevant data:
NUMBER OF SITES
TOTAL
Six
30%
Four to Five
44%
Two to Three
16%
One
7%
None
3%
FANTASY SPORTS APP USAGE IS UP
THERE WITH STREAMING APPS
The Yahoo! Sport’s Fantasy Football App ranks #5 in the
top sports apps by total minutes.
8
1
ESPN SPORTSCENTER
2
MLB AT BAT
3
TEAM STREAM
4
NFL MOBILE
5
YAHOO! FANTASY FOOTBALL
CHANGING
CHANGING
THE GAME
GAME
THE
GOING MOBILE
Among those that use a mobile device, fantasy sports players have used a mobile device or app to:
ACTIVITY
TOTAL
Access cheat sheets and rankings to help with
drafts and auctions
13%
Access real-time fantasy games or player stats
67%
Get player news, information or injury reports
54%
Get scores of actual games (MLB, NHL, NBA, etc.)
69%
Change their fantasy team lineup, make trades, or
conduct transactions
44%
INTEGRATING FANTASY ACROSS MEDIA
Sports media companies have evolved their sports coverage by strategically programming networks,
magazines, digital platforms and events with specialized fantasy sports content.
Highlight shows feature fantasy stats, top fantasy picks and debate on who the fantasy “sleepers” are. ESPN
has even created entire segments on existing studio shows to translating player performances and how they’d
stack up in fantasy. There has also been a rise in major sports publishers with dedicated fantasy editorial staff;
from Yahoo! Sport’s Brandon Funston to ESPN’s Matthew Berry, these people have been making good money
dissecting and reporting the world of fantasy sports.
FUN
FACT:
9
There is a ‘Hall of Fame’ for both the Fantasy Sports Trade
Association and the Fantasy Sports Writers Association
CHANGING
THE GAME
DEVELOPING NEW CONCEPTS
A dedicated fantasy sports network recently
launched in Canada…
….while a fictional show about a fantasy football league
prepares for its 7th & final season on FX Network.
Leonard Asper, CEO of FNTSY Sports Network
Cast of The League
ADDING NEW SPORTS TO THE MIX
While football and baseball have been the pioneering sports, the fans’ appetites and game operators’ risktaking has led to fantasy competitions created for:
Australian Rules Football
Hockey
Auto Racing
Mixed Martial Arts
Basketball
Professional Wrestling
Boxing
Rugby
Cricket
Soccer
eSports (Video Games)
Surfing
Golf
CREATING EVENT EXPERIENCES
Draft days are brought to life for fantasy
sports just like the real pro league drafts …
10
… with pre-season media days built specifically to
bring top fantasy performers to meet the public.
CHANGING
THE GAME
THE NEWEST ADDITION TO THE MIX: DAILY FANTASY SPORTS
Even as traditional fantasy leagues on ESPN, Yahoo!, CBS Sports and others keep growing, daily fantasy
sports leagues have become incredibly popular as fans can play with and potentially win real money. The
year-over-year growth is exponential, especially as the leagues have been collaborative to a degree in
promoting the games.
DAILY FANTASY FOOTBALL
UNIQUE AUDIENCE ‘14 UNIQUE AUDIENCE ‘14
YOY GROWTH
INTERNET
877,000
5,129,000
+485%
MOBILE
319,000
3,022,000
+847%
ALTERING THE LIVE-SPORTS VIEWING EXPERIENCE
As the professional sports leagues have been dedicating substantial resources including prominent
promotion and real estate on their media properties for their traditional fantasy game formats, the NHL
and NBA have taken equity positions in DraftKings and FanDuel, respectively. Add the investment of
Comcast/NBC Sports in FanDuel and a pending ESPN stake in DraftKings, and fans will find that fantasy
sports is changing the live-sports experience.
"Even if your team isn't playing well (meaning the Giants as an example of your teams) you're still following
your fantasy league or you're following the Red Zone or your mobile device," NFL Commissioner Roger
Goodell said. "So it has created more interest for a longer period of time."
FanDuel has stated that fans consume 40% more sports content across all media once they start playing
FanDuel.
With fantasy sports becoming a bigger part of the game, sports fans will be watching more games and
consuming more content than just about their favorite teams or players.
DEDICATED MEDIA CONSUMPTION
24% of fantasy players would cancel or not subscribe to premium TV if they were not playing fantasy sports
38% of fantasy players who pay to play in fantasy leagues would cancel or not subscribe to Premium TV if they
were not playing fantasy sports
11
The demographics are
shifting, and the channels
growing, as the
composition of fantasy
players becomes less
homogenized, making
fantasy sports an even
more interesting playing
field for marketers.
TEENAGERS ARE GROWING UP
WITH FANTASY SPORTS
Teens are the fastest growing group of fantasy
sports participants, and there is a good chance
their interest in sports in general has been
aided (or jaded) by the advent of fantasy sport
sites. In a world were analyzing the worth of a
player is the norm, those with gamer
personalities continue to seek out content they
can access via mobile and share across their
networks.
MOBILE SHOOTS AND SCORES
Last year, 73% of men used a tablet or
smartphone to access fantasy football
related media, with 29% stating it as the
primary medium for this information. The
numbers will continue to grow as more game
operators design for mobile-first - enabling
fantasy players to make all of their moves in
the palms of their hand. We will continue to
see new games launch as apps while existing
games will quickly optimize their mobile
experience.
6 KEY TRENDS
IN FANTASY
SPORTS
WOMEN WILL CONTRIBUTE TO THE GROWTH OF
FANTASY SPORTS
As fantasy sports continues to mainstream, women participation
continues to grow. Today women account for nearly 20% of the
fantasy sports market, however research indicates 40% of women
have an interest in fantasy sports. Fantasy isn’t just a man’s game
anymore which will open up opportunities for brands to reach a
more unisex audience.
SOCIAL MEDIA MULTIPLIES THE OPPORTUNITIES
Game operators are successfully experimenting with social media to
build more immersive fantasy experiences, as consumers seek out
opportunities to trade players and crowdsourcing tips via their social
networks. The openness of these networks is allowing anyone to be
a fantasy expert via the simplicity of setting up a Twitter account. To
control their own destinies, fantasy game operators will push even
further into integrating social media promotion, sign-ups, scoretracking, updates and other gamification into the mix.
PROFESSIONAL SPORTS ARE ALL-IN
The leagues are recognizing and embracing the value of fantasy
sports as part of the overall sports experience. With the NHL and
NBA taking equity positions, the MLB has developed an official
partnership with DraftKings and the NFL is still mapping out plans
for larger involvement. This buy-in from professional sports leaders
will lead the way to a proliferation of more content, new games,
legal money-play and overall participation growth.
DAILY LEAGUES & HIGH STAKES GAMES WILL KEEP
GROWING
The newest craze and fastest growing game format of daily games
will get even larger this year, building off last year’s 847% growth.
With the increase in marketing activity to lure new users, FanDuel
and DraftKings will both see upticks while other start-up daily sites
will make smaller dents in the market.
12
High stakes games are the ultimate fantasy competitions which
pit the most ardent fantasy players against one another after they
pony up entry fees ranging from $100 to $20,000. High stakes
games don’t just offer sizeable monetary prizes; they also create
experiences ranging from meet & greets to destination events for
on location drafts.
.
OPPORTUNITIES
FOR BRANDS
INTEGRATE ACROSS CHANNELS
As the research shows, fantasy sports is being more integrated into mainstream media while at the
same time the marketplace is becoming increasingly more mobile. As media companies continue to
dedicate content across channels to fantasy, there’s a greater opportunity for brands to develop a
multi-channel fantasy platform.
Example: AT&T partnered with ESPN to create a dual language Fantasy World Cup Soccer program
that played out across ESPN.com, ESPNDeportes.com and ESPN Deportes TV & Radio.
BRAND THE FANTASY EXPERIENCE
If there is an opportunity to leverage existing content or gamify something that adds value to the
fan experience, brands can become part of the game. Sponsoring content within fantasy games will
always be a staple as that is where the eyeballs will continue to go, but brands can also work with
partners to create their own games.
Example: Scotts took their baseball-themed anthem of Go Yard to create a Home Run Challenge on
MLB.com.
CONNECT CONSUMERS WITH EXCLUSIVE EXPERIENCES
Just as the term fantasy implies, the concept here is that fantasy sports allows consumers to
manage their “dream team” – something they can’t do in reality. If a brand wants to make those
dreams come true in an even bigger way, there are great opportunities to give consumers
something aspirational or potentially unattainable.
Brands empower fans with access to exclusive content, unique prize packages, and the chance to
play fantasy with celebrities and former pro athletes.
REACH PEOPLE IN THE WORKPLACE
It is estimated that fantasy sports participants spend an average of 10 minutes per day, or almost an
hour per week, making moves for their fantasy teams. During the 17-week NFL season, 60% of
participants spend more than an hour a day thinking about their fantasy teams.
Brands have always looked to the traditional news and business media outlets to reach people in
the workplace while also innovating their reach through social media and sites like BuzzFeed, but
one of the best ways to reach an at-work male audience may be via fantasy sports.
While this may not bode well for office productivity, it surely calls out that brands could be
successfully reaching fantasy sports participants from 9-5pm.
13
14
SPORTS MEDIA IS
INNOVATING TO
CAPITALIZE ON
FANTASY SPORTS
Whether it’s dedicated content within existing
programming, brand new concepts for TV, digital, print and
radio, or fantasy expert talent, both established and
emerging sports media channels are laser-focused on the
impact that fantasy is having on their businesses. Fantasy
sports is changing the way consumers follow sports – there
is no such thing as traditional coverage anymore.
FANTASY SPORTS
PARTICIPANTS ARE
DEDICATED
CONSUMERS
Brands looking to reach an audience proven to be loyal
should look no further than the fantasy sports marketplace.
With the amount of time spent on fantasy sports across
multiple information sources, via social media and on
mobile, fantasy participants continue to come back for
more.
WITH NEW CONCEPTS
ALWAYS DEVELOPING,
THIS IS A WHITE SPACE
FOR BRANDS
From becoming part of the content experience to
developing bespoke programs, we are still at the early
adopter stage for brands to play in the fantasy sports space.
By tapping into the creative gaming developer’s mind, those
that know how to connect with fantasy sports participants,
brands can successfully engage with sports fans in ways that
have never been done before.
FANTASY SPORTS WILL
NOT STOP GROWING
It’s difficult to find an industry or marketplace with the
exponential growth that fantasy sports has seen. With the
buy-in of professional leagues, the allure of daily fantasy
games and a never-ending appetite of fans to become part
of the sports experience, fantasy sports will continue to be a
growing market and an undying passion point to reach
consumers.
For additional information, please contact:
Jason Blake, Jason.Blake@groupm.com or
Whitney Fishman Zember, Whitney.Fishman@mecglobal.com