Fantasy Sport: No Longer a Fantasy Business
Odds are that you know a couple, or perhaps many people, who play fantasy sport. This once niche hobby for middle aged men has now flourished into a major industry. From its origins 30 years ago in a New York coffee shop, it is incredible to note that there is an estimated 35 million plus fantasy sport participants across North America. The stats continue to impress as one in five males were estimated to be playing fantasy in 2011 (FSTA, 2011). OK, yes everyone understands that a lot of people are now wasting their time on fantasy sport, but did you know that it is a hugely successful industry? Fantasy sport services have posted double-digit annualized growth since 2007 and in 2013 was a 1.2 billion dollar industry.
Don’t believe that this growth is planning to slow down either. The rise of daily fantasy sport platforms as well as an increase in participation is keeping the industry moving in an upward direction. This is not going unnoticed as the amount of money put into fantasy services continues to grow. New major platforms are popping up every year (i.e., Sports Illustrated in 2014), and sponsorships have been steadily rolling in. Not only are consumers and sponsors cashing in, major professional leagues are also seeing the benefits of fantasy sport as a legitimate way to create an engaged fan base. It seems fantasy is a win-win-win scenario.
The Win for Consumers:
Plain and simple, fantasy sport makes watching sports more enjoyable. Take fantasy football for example. Instead of only watching my favorite team on Sundays, fantasy sport gives me a vested interest in various players on a variety of teams. Fantasy also taps into the competitive nature that most friends have with one another. For many, there is nothing better than going toe to toe with one of your best friends for bragging rights (or perhaps some more substantial kickbacks depending on the league). It also is a very social experience, with many fantasy leagues consisting of 8-12 friends. This social aspect tends to even encourage participation in those who may not be huge sport fans. All of this leads to a more exciting and engaging viewing experience. In essence, the rise in fantasy sport has turned many sports fans into sport fanatics.
The Win for Professional Leagues:
Professional leagues are realizing the benefits to this enhanced fan experience. Fantasy sports are creating much more engaged and passionate fan-bases. Fantasy players watch more games, more consistently watch pre-game shows, attend more games and overall perceive themselves as bigger fans of sport. This effect that fantasy sport has on creating stronger fan bases can help professional leagues garner larger broadcast deals, secure greater sponsorship contracts, improve attendance, as well as increase merchandise revenues. One recent example of this is the first official CFL fantasy football league by TSN presented by Moores. The CFL has been looking for ways to strengthen their fan base and as seen through the success of NFL fantasy football, this could be a great success for a league that is in definite need of a boost.
The Win for Sponsors:
There are essentially two reasons sponsors are becoming more and more interested in fantasy sport.
Fantasy sport offers potential sponsors an incredibly engaged and passionate fan-base. One study reports that consumers spend on average 2.3 hours/week on fantasy sport (sport media consumption report, 2013). While another report states fantasy players actually spend an average of 39 minutes/day on fantasy football websites (Maestas, 2013). This is over 75 times longer than the internet average. Marketers dream of this type of engaged audience and constantly look for ways to associate their brand with these properties.
Fantasy sport offers potential sponsors the opportunity to reach very desirable consumer demographics. The average fantasy sport consumers are male, often in their 30’s or 40’s, college educated professionals, with an average household income of over $90,000 with high disposable income (Chudgar, 2013). This demographic is sure to hit many points on almost any marketer’s checklist. Especially if you consider industries such as auto, beer/spirits, or consumer packaged goods. However due to the engaging nature of fantasy sport, it still takes a clever campaign to garner attention for a sponsoring brand. It is no longer enough to simply throw ads at consumers and expect major results. In markets such as fantasy sport, brands need to engage consumers on their level. This is the only way to take advantage of this great opportunity.