Interview with Ransu Salovaara

Last week I asked a emailed a few questions to Ransu Salovaara, CEO of Sportsyndicator Ltd., an online advertising company focused on sports sites. Mr. Salovaara was kind enough to share some of his insights on the convergence of sports and the Internet.

Q. How can sports properties benefit from the world of Web 2.0?

A. People spend significant amounts of time on sports Web sites and are therefore easy to reach with online advertising. Moreover, these interactions are totally measurable. In regards to sports, the Web has surpassed the print medium as the number one content resource. So, with Web 2.0, sports brands can create services that truly engage customers and attract them to brands. A good example of this is Nikeplus.com, which is a great way to measure and share content – specifically running information.

Q. What do you think will be the most significant change in sports advertising in 2008? In the next 5 years?

A. I see three major changes:

1. Print will die. Already we’re seeing a decline in youth magazines, like those aimed at snowboarders and skiers. Young guys don’t see a reason to buy magazines anymore since the Web is full of info, videos, and other content that appeals to them. I’m sure that outdoor, golf and running titles will soon follow as the active adult generation really picks up on the Internet as a place for news, tips and community.

2. Videos on the Web will grow substantially in coming years and advertisers will find ways to get their messages in.

3. Mobile advertising will take off. This still might be a couple years away, but mobile ads are definitely coming. Now that iPhone has opened its platform to developers, it’s easy to see how resort guides, how-to tips, etc. will work on mobile phones.


Q. What niche sports audiences are the most difficult for advertisers to reach? Why?
A. There are really no hard ones, since everyone is on the Web nowadays. However, high net-worth golfers are probably the toughest as these professionals don’t surf around the “cool” Web sites like snowboarders do.

Local audiences are also tricky. Mastering "the long tail" of sports advertising so that we can target our campaigns to a specific sport and city will be crucial for many advertisers.

Q. In terms of originality and cutting-edge content, what do you think are the top sports Web sites in Europe and the US?

A. Pinkbike.com is a great example of a cool niche site that caters to free-ride mountain bikers and has 40 million page views and 400,000 unique visitors every month. Every day people upload more than 1,000 mountain biking pictures to the service. Pinkbike is from Canada but it has a global audience as is one of the most popular sports sites some European countries.

Another great site is Newschoolers.com, a freesskiing site from California. The site has more than 100,000 registered users and is considered the Facebook of skiers.

(Mr. Salovaara’s responses have been edited for clarity.)

Hulu Hoops (and more)

Founded last August and debuting last month, Hulu might just be the future of TV on the Internet. A joint venture between Fox (News Corp) and NBC (GE), this little site with big backers bills itself as “a single source of free, on-demand programming from some of the most popular studios and online networks, helping viewers quickly and easily find and enjoy the premium content they are looking for.”

Hulu just added its first sports content this week, with content from the NBA and the NHL. Sure, the pickings are slim right now (there are only two NBA games up, they’re both months old, and they’re both Lakers games) but the site is just getting off the ground. The potential for this to be a sports hot spot is there.

Hulu now offers these sports features, free to everyone:

NBA
- 2 full-length games (including Kobe Bryant’s 81-point game)
- Daily Recaps
- Highlight reel: NBA 5-star plays
- Top 10 highlights

NHL
- NHL Best of The Week - Season 2007-08 (highlights the week's best assists, goals, saves, and hits)
- NHL Classics
- NHL Player Profiles 2007-08
- NHL Regular Season 2007-08

Action Sports
- Firsthand
- The 808 from Fuel TV

College Football
- The Boise State-Oklahoma battle in the 2007 Tostitos Fiesta Bowl

There’s no doubt that by the next time I log into Hulu there will be significantly more content. The real question is how NBC, Fox and their partners will transition these sports events from TV to online distribution. The current advertising model relies on short commercial breaks (with ads from Intel, Priceline, Direct TV etc), banner ads, overlays (promotional graphics that roll over the bottom of the screen) and maybe extra sponsorship dollars from events sponsors. Some games also offer a choice to viewers: to watch the game with commercials, or watch a two-minute advertisement at the beginning. (The Wizards/Lakers game is currently being shown with a preview for “Baby Mama.”)

The main obstacle for Hulu, going forward, will be whether it can attract other major content providers like CBS and ESPN. If Hulu can expand its broadcasting capabilities then it will be bigger than YouTube, bigger than social networking, maybe bigger than Google.


Notes:

NBC Sports broadcasts the Olympic Games (through 2012), the NFL, the NHL, Notre Dame Football, the PGA Tour, the USGA Championships, Wimbledon, the French Open, RCA Tennis Championships, the Dew Action Sports Tour, and more.

Fox Sports has broadcast rights to NFL games, MLB (1996–present), college football's Cotton Bowl, most of the Bowl Championship Series (BCS National Championship Game, Fiesta Bowl, Orange Bowl, and Sugar Bowl), and NASCAR. ‎

Virtual Ads

At their exhibit at the New Orleans Convention Center, the Spalding team showed off its plans to use NBA backboards as an advertising medium. Spalding’s rear-screen projection system would put ads on the glass backboards during timeouts, halftime, and other non-play periods.

Virtual ads are nothing new: the patent dates back to 1993 and the technology really took off in 2002, about the same time that virtual first-down lines started showing up in NFL broadcasts. But where midfield soccer ads, corporate logos behind home plate, and branded first-down lines are all examples of completely virtual advertising, the projection technology proposed by Spalding is visible to in-game spectators as well as broadcast viewers. In fact, the target audience is presumably the in-game spectator since timeouts and halftime trigger commercial breaks for broadcasters.

It will be interesting to see how this technology is received. In the 2001 World Series virtual ads were criticized as obviously fake and obnoxiously big, while today they are a fully-integrated part of the event.