Partnerships based on advanced sports analytics can lower costs and open up creative sales promotions opportunities around major sporting events, says Martin Bailey of Opia
Data analytics now dominate the coverage of sport, as broadcasters and journalists gain access to detailed performance statistics used by coaches and bookmakers.
The ever-growing sophistication of sports analytics conducted by powerful algorithms and machine-learning provides instantaneous breakdowns of almost every useful match or career detail, from passes completed, to their direction, length and recipients. Goal-scoring opportunities, yardage covered, cautions incurred on a wet Tuesday – all the data is there along with its analysis.
There are massive benefits for marketers, too: tapping into this data offers brands and agencies the opportunity to run bespoke sports-based promotional campaigns around specific events.
The biggest opportunity in the world
With the FIFA World Cup, the world’s biggest single-sport tournament, looming, retailers and manufacturers will use the unmatched pulling-power of football to boost sales promotions for everything from consumer electronics to cars, fuel and furniture, with cash-for-goals or cashback campaigns relating to wins by the UK home nations.
Sports marketing has been around for decades; but developments in technology and social media have revolutionised opportunities for creativity.
One example is the English Sports Council’s 2015 #ThisGirlCan campaign, which addressed health issues such as obesity after research showed that two million more men than women participated in sports in the UK. In this case, the use of sports analytics was backed up by showing positive, normal women as role models. The resulting video content was viewed and shared over eight million times. Two years later the hashtag is still going strong and women across the country have been inspired to be more active.
Real Madrid recently cemented its position as one of the biggest international football brands by launching its own Snapchat account. In just three months, the club gained almost half a million subscribers.
These sporting organisations used insights derived from data analysis to enable them to engage with fans effectively. They used analytics to segment their fans, estimate customer lifetime values (CLV), generate leads, predict retention of existing fans, and measure performance of marketing activities. All to great effect.
Big sports data is the difference
Until now, the approach used to calculate insurance rates involved in a sports cashback promotion has been based largely on assumptions, loss ratios and subjective form, with bookmaker odds often acting as a base point. This means rates have been historically impacted by cognitive bias (for example the expectation that England will do better than they are actually likely to do in the World Cup) and influenced by a herd mentality on how the rest of the market acts.
As more bets are placed on the home nations the cost to place the bet increases, simply because more bets have been placed. In reality, the underlying conditions have not changed.
Accurate sports data can remove this bias and ensure the most accurate promotional pricing.
Disrupting sport risk promotion market
More recently, we have seen new partnerships disrupt the status quo, for example between consultancies designing customer-grabbing, bold, creative sales promotions and incentives, and the companies supplying the data to the sport and betting industries. Sales promotion strategies are now crafted from these advanced data-sets, reflecting the reality on the pitch and not the sudden enthusiasms or group-think of the betting market.
Now, insurance underwriters can see that the consultancy has designed a sports risk promotion based on hard, detailed and thoroughly-analysed data from sports risk companies.
The significant advantage to retailers and manufacturers in all this is that premiums become lower. It means that far more companies can undertake the kind of creative promotions they have hitherto only considered as fantasy football items on a wish-list marketing plan.
Creativity and expertise in promotion-design
Promotions can be quirky and distinctive, but they need to be easily understood so that the ordinary consumer feels included. It would be too easy to use the wealth of big data analysis to come up with a promotion that appeals to a relatively narrow band of devoted fans.
A cashback offer that rewards a consumer buying a high-value washing machine for every goal scored by a high-profile team or player is more likely to hit the right demographic than one related to the number of bookings achieved by players with poor disciplinary records. This is an obvious example, but it is all too easy to get it wrong and end up with a costly flop or a promotion that over-achieves and leads to higher-than-expected levels of redemption and very high costs. This is where access to consultancies with the creativity and long experience of running such campaigns, is a pre-requisite.
Retailers and OEMs must launch their promotions now
In fact, the science of promotions has been operational for a decade, using predictive analytics and specialist underwriting guarantees to ensure that the promotion hits the back of the net without the retailer or manufacturer ending up out-of-pocket. Ordinarily, the downside of not being able to predict how many customers will take up the offer would be the risk of the promotion lingering on a firm’s balance sheet, as well as the potential financial risks if the promotion was more popular than anticipated.
Now, however, end-to-end management of risk-managed promotions with a sports hook has been taken to the next level of performance through the application of big data sports analytics. This heightened level of big data insight, combined with the creative expertise and flair of a risk-backed sales promotion consultancy is an unbeatable pairing. It will enable any retailer or manufacturer to stand out from the crowd and achieve far greater revenues than competitors when the World Cup comes round. The tournament is however, approaching fast and organisations need to grasp the opportunity now. It should be a great summer.
Martin Bailey is an Account Director with creative sales promotion consultancy Opia. Opia has recently partnered exclusively with sports risk experts Siepe Sports, who specialise in the provision of sports analytics data to the insurance industry, to enhance the assessment of risk levels in sports-related promotions.