Under Armour Using Snapchat to Sell Basketball Sneakers

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Under Armour (UAA) has developed an effective formula to sell basketball sneakers to the U-16 demographic on Snapchat (SNAP). While SNAP ads run for 10 seconds, UAA has been designing their ads to run 5-6 seconds; with the call-to-action occurring within the first 2 seconds. As a result, they’ve found that consumers are watching the ad 1.5 times (thus more likely to catch message), as opposed to “clicking away from it.” Under Armour’s success on the mobile app has come in the form of lens campaigns and mobile gaming; advertising that took advantage of the platform “to move beyond video and create interactive experiences for consumers.”

Howie Long-Short: The U.S. athletic shoe market grew 2% in 2017 to $19.6 billion, with the kids’ sector growing 1% YOY. Under Armour’s footwear sector had a strong Q4 ‘17, growing 9% YOY and Founder Kevin Plank says he expects the sector (along with women and international) to drive company growth in 2018. With that said, UAA shareholders should temper their excitement. As a category, sport leisure (+17% to $9.6 billion) outperformed performance (-10% to $7.4 billion) in 2017 and there wasn’t a single performance shoe (UAA’s niche) in the Top 10, for sales. It is also worth adding that while UAA’s SNAP campaigns have been successful, NPD Senior Analyst Matt Powell reiterated, “Under Armour has always overindexed with kids and has never carried them to high school.”

Fan Marino: The U-16 crowd spends an exorbitant amount of time on SNAP, so offering a highly-engaged audience entertaining interactive experiences is a sound philosophy on Under Armour’s part. Among their recent successful campaigns were a Dennis Smith Jr. (UAA athlete) lens, during All-Star Weekend (he competed in dunk contest), and a game featuring Steph Curry. Users spent an average of 79 seconds posing next to the virtual version of the Mavs rookie, while the Curry game was played more than 3 million times; with the average user spending 3 minutes playing.

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NASCAR Experiences 80% Increase in Snapchat Viewership Following App’s Re-Design

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A newly re-designed Snapchat application (SNAP), with an increased focus on Discover, has given NASCAR an 80% boost in the number of viewers who watch its stories. Discover, the platform that allows verified media companies (plus influencers, brands and celebrities) to run their own channels and to split the ad revenue generated, was given its own section following the SNAP update. On last week’s earnings call, the company announced that +/- 25% of all users were using the re-designed app; insinuating viewership numbers should continue to increase. The re-design will be fully deployed by March 31st.

Howie Long-Short: While the re-design is being panned by younger users, it appears to be serving its purpose; to give publishers, brands, influencers (i.e. the people who monetize the platform) the ability to increase eyeballs (and ultimately revenue). SNAP reported Q4 ‘17 revenue increased 72% YOY (to $286 million), while revenue per user grew 46% YOY; the image messaging and multi-media mobile application also added 8.9 million daily users (to 187 million) during the most recent quarter. It wasn’t all positive news though, GAAP (generally accepted accounting principles) net losses more than doubled (as costs soared, ex: R&D +260%) during the quarter. It should be noted that with a market cap of +/-$24 billion, the company is trading at an absurd +/-30x ’17 earnings.

Fan Marino: The Hashtag 500 will be returning for the 60th running of the Daytona 500, giving fans the chance to compete on social media for memorabilia from Sunday’s race. To play, tune in to Fox at 2:30p EST and follow @NASCAR on Twitter (TWTR); they’ll be releasing custom hashtags (every 20 laps) that give fans the chance to enter random drawings for race gear (see rules, here). A driver’s fire suit, helmet, steering wheel and a set of Goodyear Tires are among the prizes to be won; the grand prize is a trip for 2 to the ’18 Monster Energy NASCAR Cup Series Championship in Miami. The ’16 Hashtag 500 set several NASCAR social media records, including tweets per minute (13,000).

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Fox Sports Announces WC Content Partnerships with Twitter, Snapchat

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Twenty First Century Fox Inc.’s (FOXA) Fox Sports, which holds the exclusive English broadcast rights to the 2018 World Cup, has announced several content partnerships that will expand their coverage beyond the television screen. FOXA announced plans to stream exclusive digital content on Twitter, Inc. (TWTR), including 27 live shows (30 minutes per) and near real-time highlights of every goal scored. On Snapchat (SNAP), the broadcast network will create “Publisher Stories” using video, text, artwork and motion graphics to comprehensively document every day of the tournament. SNAP will also produce FIFA World Cup “Our Stories”, featuring highlights and exclusive fan reactions. The 2018 World Cup, hosted by Russia, runs from June 14th through July 15th.

Howie Long-Short: To boost advertiser interest, Snapchat commissioned a recent study (using internal data and insight from Nielsen) on the company’s “unique audience”; users more active on SNAP than they are on other social platforms. The study focused on a subset of users interested in sports and sports-related content. It found SNAP users are more likely to be sports fans (i.e. watch, attend, stream games) than non-users, are more active on their smartphones at sporting events (important to activate and connect with fans) and “feel a stronger connection to sports” (i.e. spend more on officially licensed products). That sounds like a platform all sports leagues might want to explore.

Fan Marino: Twitter is reportedly exploring the concept of implementing micro-payments that would enable sports fans to watch the endings of close games; think iTunes for sporting events. I don’t see it. Fanatics (or gamblers) who would care about the ending of a close game, already have access to the out-of-market packages. The casual fan will simply continue to catch the highlights as soon as the game ends, for free. Proponents of this idea point to video games and the success in-game micro-payments, but gamers are engaged. I don’t believe that’s a valid case study.

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Short-Form SportsCenter Now on Snapchat

ESPN (DIS) launched a new short-form version of its flagship show SportsCenter on Snapchat (SNAP) Monday evening. The 3-5 minute show has been “re-imagined” for a younger, mobile demographic and the new platform; though it will still be comprised of sports news, highlights and commentary. SportsCenter on Snapchat will air weekdays at 5a and 5p (just 5a on weekends) on Snapchat Discover. While terms of the deal were not disclosed, the companies will share the revenue generated.

Howie Long-Short: This partnership looks to be mutually beneficial. 47% of teenagers list Snapchat as their favorite social media platform, so ESPN was wise to bring their flagship show to where their future audience is hanging out. SNAP has been actively working to expand its sports programming and while it has deals in place with the NFL, F1, Turner Sports and the NBC for the Olympics; it never had a daily sports show. Unfortunately, SNAP’s Q3 ’17 earnings report wasn’t as promising. The company reported a quarterly net loss of $443 million and grew its user base QOQ just 2.9% (4.5 million new users), its lowest ever growth rate.

Fan Marino: At 35 years old, I’ve never downloaded the Snapchat application; but this partnership may change that. Short-form SportsCenter has me intrigued. The hosts named thus far are Katie Nolan, Elle Duncan, Cassidy Hubbarth, Jason Fitz and Cy Amundson. While Nolan is a household name, the other 4 are relatively unknown entities. With upcoming layoffs expected to hit the SC franchise hard, I’m not surprised to see the names of anchors that likely command lower salaries (Nolan being the exception).

ESPN launches a short-form version of SportsCenter on Snapchat

Editor Note: The summary for this story was co-written by our friends at The Water Coolest. Check out TheWaterCoolest.com for the latest market news and professional advice.

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EUROSPORT TO LAUNCH SNAP CHANNEL FOR ’18 OLYMPIC GAMES

Eurosport, the Discovery Communications (DISCA) owned sports network, has signed a strategic advertising and content partnership with SNAP Inc. (SNAP) for the ’18 South Korean Winter Olympics. Announcement of the agreement marks the first-time SNAP has publicly committed to a European, multi-language Olympics deal; though the company is experienced putting out content for the Olympics, having partnered with NBC (in the U.S.) for the ’16 Games (will again in ’18). The partnership will bring Snapchat users across Europe professionally curated (i.e. Our Stories, Publisher Stories) mobile video content; including behind-the-scenes action from Olympic events and user-generated video from the athletes and influencers.

Howie Long-Short: DISCA paid $1.44 billion for European rights to the games, across all platforms, through ’24; just a fraction of the $7.65 billion NBC (CMCSA) is paying for television and online rights to the games through ’32. Partnering with SNAP gives DISCA an opportunity to sell potential advertisers on a different demographic; one that is younger and more digitally minded. It also brings the games to viewers who may not otherwise watch on linear television; with 25% of U.K. smartphone users now using Snapchat daily. Eurosport should turn a healthy profit on the ’18 Winter Games.

Fan Marino: Softball, karate, skateboarding, sport climbing and baseball are sports that will be debuting at/returning to the Olympics in 2020. While one can certainly debate the merits of sport climbing; it’s talk of poker, foosball and pole dancing coming to the Olympic games, that have me all worked up. Can we all agree that “sports” using a casino, bar or strip club as a primary venue, are not worthy of competing in the Olympic Games?

Discovery’s Eurosport Pacts With Snapchat for 2018 Winter Olympics

FORMULA ONE INTRODUCES ESPORTS SERIES TO COINCIDE WITH ON TRACK CHAMPIONSHIP; F1 2017 VIDEO GAME RELEASED TO STRONG REVIEWS

Formula 1 (FWONK) is entering the esports arena, launching a gaming series with the help of esports operator Gfinity (LON: GFN). The series will focus on the new official F1 video game published by Codemasters; and will coincide with the on-track world championship. The inaugural season which will run from September-November, is Formula One Group’s latest attempt at embracing digital media (they also recently announced a partnership with SNAP). Qualification will begin in September and the series will culminate with a 20 person, 3 race event, at the F1 season finale in Abu Dhabi. The “esports World Champion” will receive automatic entry into the 2018 competition, passes to the 2018 Grand Prix and will become a character in the 2018 F1 video game.

Formula 1 Entering Esports Arena With Official Championships To Start In September

Howie Long-Short: F1 has been around since 1950 and has a fan base that attracts +/- 400 million TV viewers. In 10 years, esports has amassed an audience that saw 320 million people watch video games on television in 2016, with that number expected to rise past 400 million this year. Wise idea for F1 to try and attract real fans through the virtual world.

Fan Marino: From the gamers POV, F1 2017 is receiving strong reviews. A new “championship” game mode and series of vintage racers are new to this year’s edition.

F1 PARTNERS WITH SNAP; LOOKING TO GROW SOCIAL MEDIA PRESENCE, REACH YOUNGER AUDIENCE

Liberty Media’s (LMCA) Formula One and Snap, Inc. (SNAP) have partnered, encouraging fans to shoot and upload video at upcoming F1 events, starting with this weekend’s British Grand Prix. F1, which would actively look to prevent race highlights from hitting social media prior to the Malone takeover, is now looking to grow interest in the circuit by building a social media presence and reaching a younger demographic. The companies will split all ad revenues generated, but no additional terms of the deal have been released.

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Formula 1 and Snap Inc. announce new global partnership

Fan Marino says: My F1 knowledge goes 2 drivers deep. Michael Schumacher and Mario Andretti. That is in the HISTORY of the sport. Marketing their stars, has never been F1’s strength. This deal will help bring attention to, if not interest in, the circuit within the U.S.

Howie Long-Short opines: I can add Ayrton Senna to the list–but only because his documentary is on Netflix. I don’t know a single fan of F1. USA is a huge opportunity for F1 under Liberty’s control, but they have a long way to go.

SOCIAL MEDIA COMPANIES OFFERING FOX ‘TENS OF MILLIONS’ FOR ’18 WC VIDEO HIGHLIGHTS

Facebook (FB), Twitter (TWTR) and Snap Inc. (SNAP) are said to be among the companies offering 21st Century Fox (FOXA) tens of millions of dollars, for the rights to stream video highlights from the 2018 World Cup. The recent demand for premium video content, from social media companies, provides Fox with a significant new source of revenue and means to promote its television coverage. Fox paid $400 Million for the exclusive rights to air games from the next 3 World Cups (2018, 2022 & 2026), on broadcast and cable TV, in the U.S.

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Facebook, Twitter Are Said to Seek World Cup Clips From Fox

Howie Long-Short opines: SNAP is looking for another negative-margin revenue line? I’m not sure why FOX would want to empower future competitors.

Fan Marino says: You have to hope Twitter wins the bidding war. As a real-time news source, it’s the only logical place for game highlights. Your modern day SportsCenter.