Ways Advances In Social Media and Technology Have Affected The Profitability of Pro Sports, Their Coverage, and Related Goods

The Effect of Social Media on How Sports Are Covered

Twitter has completely changed how sports are covered. Information about players and games has never been more accessible than it is right now and just about anyone can do it as opposed to before when this was strictly dominated by newspapers and television stations. Take Jarred Carrabis for example. He has no formal education in journalism, writing, communications or anything related to his position in sports media. His first attempt at Red Sox blogging, SoxSpace, was a Myspace account that had over 100,000 friends until he decided to launch his own website. Yet, through blogging and tweeting he has amassed an enormous following and has become one of the most powerful voices in Boston for baseball coverage.

Jared Carrabis On Air.jpg

Jarred Carrabis Live on CSNNE

 

Almost everything about a star athlete is covered nowadays no matter how minuscule the news might be. They all are very aware of it and they’re capitalizing. It’s not just about the score of the game anymore. On-and-0ff-the-field antics of professional athletes have never been so prevalent in the media.  These two stories about what cleats the same player is wearing are only 6 months apart. Before twitter, I can’t remember when something like this would even be considered news.

A lot more players are making it a priority to do unique & flashy celebrations like bat flips and touchdown dances so that the clips will gain traction online in order to make the games more enjoyable to watch and even make themselves more marketable for lucrative endeavors.

Here’s a compilation video of some of the Red Sox outfielders’ celebrations that they have been doing after every win this season.

 

At the beginning of this NFL season, NFL player Colin Kaepernick made a very controversial decision to not stand during the national anthem before football games to protest how African Americans are treated in this country. No one noticed it for the first 2 weeks of the season. It wasn’t until Jennifer Lee Chan tweeted out a picture of the team, unrelated to Kaepernick, that people noticed and began asking questions. After addressing the media and explaining his reasoning, his jersey became the #1 selling jersey in the NFL as a result and he isn’t even a starting player. Regardless of whatever your political view is, it’s undeniable that the large social media following that all of these athletes have has given them a platform to voice their opinions and influence people on matters other than just sports.

Colin Kaepernick National Anthem.jpg

IGAs: In Game Advertisements

Big changes have been made for the new Madden NFL 17 video game. With the newest updates in the games I’ve realized that EA Games has been setting themselves up for a more lucrative position to gain revenue from IGAs.

If you take a look at a Screenshot from last years game, there isn’t a single advertisement in sight. It’s all team logos or NFL logos. Madden 16 Ads.jpg

Now take a look at Madden NFL 17. If you look at the top right corner of the screen you’ll notice a Snickers advertisement as opposed to a Patriots or NFL logo. Not a significant difference but a big first step. I’ve also noticed advertisements for Twitter, Facebook, & Snapchat in the game.madden-17-iga-jpeg

Now take a look at what a real NFL stadium looks like. I count 7 ads in this one picture.

gillette-stadium-ads

Madden NFL 16 was the 2nd highest selling video game of 2016. In total, video game sales generated over $5 billion in 2015. EA Games and the NFL are going to be able to eventually replicate this model for their real-life advertisements in their video games to make them much more profitable without having to raise prices of the games.

Daily Fantasy Sports

Daily Fantasy Sports are online websites that are essentially an accelerated version of the traditional fantasy sports leagues that have been around since the 1980s. They have rapidly gained popularity in recent years due to the ease-of-accessibility. Rather than season long commitments however, the participants are only bound to the teams they select for a day or a week as opposed to the original model of an entire season. The two most notable DFS Operators are FanDuel and DraftKings.

Every week, there are thousands of pools that a participant can enter (public and/or private) for either a single day or an entire week. If a participant wins a pool, they can potentially win $1 million or more. Once the participant chooses which pools they want to enter, they pay what is called an entry fee. Entry fees fund revenue for the company and winnings for the participants. Every participant in a pool is given the same set budget to select real professional athletes they want on their team. Each player is given a set price based on performance that the participant needs to give up out of their set budget in order to obtain this player for their team. The players earn fantasy points based on their real life in-game performance and the participant whose team gets the most fantasy points wins prize money.

draftkings-lineup

Here’s a screenshot of a DraftKings lineup on their site.

In 2015, DraftKings and Fanduel collected $3 billion in entree fees. However, DFS Operators have recently been in the midst of a lot of  controversy. In this study analyzing the first half of the 2015 MLB season, 91% of the profits were won by just 1.3% of the players. There have also been allegations of insider trading against DraftKings employees. I definitely do not recommend trying this as you will most likely end up losing money.

 

Recap

As social media and technology continue to advance adapt and advance, the markets around them will follow. Profession Sports is a market that transcends almost every demographic in the USA and will continue to adapt in order to remain as profitable as possible. There are countless examples as to how this industry has been affected and these  are just a select few.

 

 

2 comments

  1. Wow, what a great post! I’m intrigued by the ads in the Madden. I wonder if they have to ask permission to use the likeness of Gillette Stadium? This could have really been three separate blog posts. Nice work.

  2. Very interesting post! Full of information I really liked the first of the tree parts, and in relation to it I think this increase on the coverage is both good an bad. As you have shown in the articles, this can be a good way of noticing the intention of Kaepernick. But at the same time, this is enabling us to notice also things that we would not like to notice and neither the players. As an example, a very viral video in Europe of Joachim Low the trainer of the German selection of soccer.

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