Sports Marketing & Smartphones: Part 1

Nike+ uses iPhone to create a network effect around running shoes

When Nike launched its partnership with Apple computer back in 2006, the legendary shoe company began blazing an important new trail in sports marketing. Since then the non-traditional partnership has evolved through stages, and today the Nike+ Running platform is effectively marrying smartphones to Nike running products and creating a new kind of service for Nike customers. This new service is elevating the shoe ownership experience, and creating a network effect around Nike running shoes.

Before gushing any further about Nike, or elaborating on the crucial role of the smartphone, let’s quickly explain the term network effect. In economics and business, a network effect is the impact that one user of a good or service has on the value of that product to other users. When network effect is present, the value of a product or service is dependent on the number of others using it; the more customers, the higher the value for each. Over time, positive network effects can create a bandwagon effect as the network becomes more valuable and more people join, in a positive feedback loop (Wikipedia). That is precisely what’s happening for Nike.

This network effect is converting Nike customers into members of a global running community, adding value in various ways for each member, and will most likely lead to stronger brand loyalty, increased word of mouth brand advocacy and higher profit margins for Nike. There is more to Nike’s success than adding computer chips to its shoes, and the Nike+ running case study is one every sports marketer should study, and seek to emulate.

Once runners join the community they can use their iPhones to automatically store, analyze and share data about their own runs. According to the Nike+ site, members have logged more than 472 million combined running miles since plugging into the community. Every day thanks to Nike’s partnership with Apple, runners are leveraging the iPhone’s capabilities to make their own experiences even better.

Runners are mapping and sharing information about running trails (via GPS), sharing music and organizing running events together. Nike+ is the platform for all of this member activity, which makes Nike more valuable to its customers than ever before.

Think about it. If you join the community and begin sharing your running data and experiences with the community, and that community provides a valuable experience for you, then you’re not likely to switch shoe brands. To switch brands would mean leaving friends (and your data) behind. Not many people will want to do that. The community adds value to the shoe owner without adding any cost for the member. Every new member adds more value for every other member and as the community grows larger and deeper it becomes an asset that grows in value for Nike as well. This is a breakthrough for the customer and the company alike.

Dreaming up a way to use GPS enabled smartphones to sell running shoes may seem obvious now that Nike has done it, but it’s not. Surely there are some very smart people at Nike who racked their brains for a long time before arriving at this elegant alchemy of silicon chips and foam rubber insteps. Now that the example has been set, however, it should be possible for other sports marketers to follow in Nike’s footsteps, as long as we appreciate what it took to get there.
How can you be like Nike?

Following in Nike’s footsteps will require sports marketers to use interactive imagination. They’ll need to understand both technology and their customers, and combine them in new ways. But in order to unleash interactive imagination on the customer experience, sports publishers will need to embrace the idea that the smartphone is more than just a destination to publish content. Smartphones have distinctive capabilities that open up new dimensions of interactivity.

Smartphones have senses. As we’ve already noted, smartphones have GPS so they are location aware. Smartphones also have cameras, so they can see; microphones, so they can hear; and motion sensors, so they know whether they’re upside down, right side up, or moving. We see these sense-oriented features used well in apps for navigation, shopping and gaming. Now ask yourself, how might you utilize these smartphone features to add value to your fans?

Smartphones are cloud-connected. Today’s 3G and 4G wireless networks and widely available WiFi enable smartphones to stay connected to the Internet all the time. This persistent connection enables smartphone apps to gather information (data) continuously from everyone using them. That means customers don’t have to DO anything extra in order to benefit from the system. Today Nike runners don’t have to upload data to Nike+. It can happen automatically via the iPhone into the cloud where it can be mashed up with data from other runners to create more value for the community without anyone lifting a finger. Easy. How can you collect useful data (passively) from your cloud-connected fans, and use that data to add value to their experiences?

Smartphones are crowd-connected. Better than 80% of Americans own mobile phones today, and according to the Nielsen Company, the majority of those phones will be smartphones by the end of 2011. Behind each phone is a person; not just a consumer of content, but a contributor to the community. Whether they contribute the number of miles jogged, or conversations with other runners, or photos of angry dogs isn’t the point. Because runners have smartphones, running experiences can be shared with the community. Running can be a social experience, even when someone runs alone.

How can you make this type of social experience possible for ALL your fans?
Interactive imagination is required in order to answer these questions, and interactive imagination requires a combination of techno-awareness and customer appreciation. Above we’ve described the technical capabilities of smartphones.

In Part 2 of this article we’ll focus on the customer experience, and explore ways the smartphone can be utilized to add value in specific customer scenarios.

“Waze” is like real-time Wikipedia for drivers. That’s cool, but what do this have do to with sports & entertainment?

Ever since I heard Somrat Niyogi speak at DFM11, I’ve been thinking about the “second screen” experience. The second screen is what we call the smart phone, tablet or laptop when used while watching TV on the “big” screen. Used in concert with the TV, our second screens have potential to add a lot of value to our experiences; but only if second screen designers strive to improve the user’s experience.

Somrat, CEO of MISO, is passionate about the television viewing experience and adamant that the experience needs to be fixed. (Anyone who has wrestled with on-screen programming guides would probably agree with him. The experience sucks).

It’s clear that the technology exists to do lots of cool things with mobile devices. But the biggest revolutions in “experience” are not driven by technology alone. To really change the world, we need to get people involved. Happily, in addition to innovative hardware and software, there exists today a critical mass of PEOPLE (the social layer) who can be enlisted to contribute to just about any experience, anywhere, any time. This combination of people and tech opens the door for some amazing consumer experience and business innovation.

Yet one prickly question remains: of all the things we COULD do to fix the TV experience, what SHOULD we do?

I work with sports and entertainment marketers so I’m typically thinking about the experiences fans have at stadiums, concert venues or watching sports on TV. Since smart phones took off, most sports and entertainment marketers been focused on mobile as a new channel to push content. The most challenging questions being asked during this time have been where and when to re-purpose Web content. Should we launch our own (content) app, or simply publish a mobile Web page?

Stop thinking about pushing mobile content. Start thinking about providing a service

In the past few weeks my thinking has graduated beyond rudimentary questions like whether we should have an app, or go with mobile web page. I’m thinking less about the way publishers can push content, and I’m thinking more about the fan and his or her experience. What can we do to make a fan’s experience better? How can we leverage the capabilities of available technology AND the available audience to create a service that makes the fan experience better?

As I was pondering this question for sports and entertainment, I came across a new app for drivers call “Waze.” Watch the video below before reading the end of this blog post. It’ll help light your creative lamp.

Waze enables “social driving: at an unprecedented level, and the implications are profound.

If the windshield is the driver’s first screen, and the mobile device is the second screen, then Waze has done a really nice job leveraging available technology PLUS people to create a valuable service for drivers. How can we borrow inspiration from apps like Waze to imagine ways to improve experiences for our fans?

Waze is a free social traffic and navigation app that uses real-time road reports from drivers nearby to save commuting time and improve your everyday driving. Way more than just another free navigation app, waze’s social layer is what sets it apart – giving drivers the power to work together to report and receive the most relevant traffic information available at any given moment.

The benefits of social driving continue with localized driving groups, Foursquare, Twitter & Facebook integrations, alongside other cool geo-gaming elements. And because it’s user-generated, the more people who use waze, the better it gets.

If you’ve read this far, I hope you’ll do two things:

First, download Maze and play with it. It sounds cool, doesn’t it?

Second, clear your mind and think about ways you can use the second screen – and the social layer – to add value to your fans’ lives. Don’t just think about pushing more content to them. Think about creating a service.

Ask yourself: How can you put in your fans’ hands a tool that they can use – in conjunction with other fans – to make their experiences better?

Results from My First LinkedIn Advertising Campaign

So that’s probably not the best $700 I ever spent, but it’s early days.

Recently, LinkedIn opened up a new display advertising service similar to Facebook’s. I tried the service for about a month, hoping to leverage LinkedIn’s targeted reach to sell some tickets to my Digital Fan Marketing Summit in San Francisco.

The service is quite easy to use. Took me just a few minutes to set up. It allows you to target your ads by geography, industry, job title or even group membership. Each time you apply one of these filters it changes the total number of potential people you can reach.

I tried various filters, but ultimately settled on group membership for my main filter since that gave me the broadest reach, cut across job titles, and (I thought) would give me the best chance at finding my target audience. The image below shows the groups I selected. Around 258,000 eople in these groups could (potentially) see my ad on their LinkedIn page.

In addition to targeting an audience, LinkedIn also gives you the ability to test copy variations. Granted, you have very few words to work with, but I definitely saw a difference in click through rate between the two headlines I used. The image below shows the headline and body copy of both versions, along with the total views, total click throughs and total cost of the campaigns:

My ads were displayed a total of 833,000 times over four weeks. These exposures drove just 227 clicks (.027%), but one version performed 63% better than the other. I ran one headline that featured the brand names of my event speakers, and one headline that promoted the location of the event. Clearly headlines matter. Still, it’s impossible for me to know if either iteration drove more qualified traffic, and I have no idea whether or not any of the 227 clicks resulted in a sale. That said, with my ticket price of $300, I might have broken even if just .009% of clicks resulted in a sale.

I’m going to have to practice in order to get better at using LinkedIn’s ad tool. It seems like a great thing, but I don’t think it made any difference in my results. Why do I say that? Well, full disclosure, I use Eventbrite for my ticket sales, so I have no idea how many page views LinkedIn drove to the ticket page; but I can see from the number of page views the page received that the curve and the volume look basically the same every other event I’ve ever done.

The chart below shows page views (over time) on my eventbrite landing page.

The orangish line are cumulative views, and the blue line represents daily views. You’ll notice the blue line looks like an EKG, spiking every week or so. Those spikes are directly related to the Email announcements I sent to my LinkedIn Sports 2.0 group which today has over 20,000 members. As in the past, those messages drive more traffic than anything else I do to promote my events.

I am a big fan of LinkedIn, and I hope they continue with the freemium model. It’s wonderful to be able to maintain my profile, make connections and join and orchestrate groups for free. While I wish I could message my groups whenever I wanted (rather than strictly once a week) I still get a lot of value from LinkedIn all the same.

That said, I should probably test Facebook ads for my events too. I haven’t done this in the past because, truth be told, I don’t personally use Facebook for business. I use LinkedIn and Twitter. But as long as I’ve been in the media business I realize that not all people use all media the same ways. I know plenty of folks who use Facebook for business, and given Facebook’s greater reach, as well as the potential to purchase ‘story’ ads, I might even have better luck over there than I had with LinkedIn.

If anyone out there has found great ways to promote conferences via Facebook, or if you have any suggestions for me whatsoever, please share them.

Who follows NHL clubs on Facebook?

The following infographic illustrates data gathered via a survey of NHL fans following a specific club on Facebook. Check out this companion infographic to see how Twitter followers of the same club answered these same questions.


Sports Marketing from Coyle Media, LLC.