Is the sports industry taking full advantage of virtual advertising? – “Definitely not”, says Roger Hall.
Well, of course he’d say that, being the CEO of a virtual advertising company! But Roger is in a better position than most to comment, with decades of experience working in the sports broadcasting industry, in leadership roles at NASN, Setanta Sports, and beIN Sports. He has seen many new technologies emerge over the years and has gotten pretty good at spotting those with staying power, and those without.
“For me, the best example of a technology that never took off in sports broadcasting has to be 3D.”
This technology was trialed in the UK in 2010, and was predicted to be transformative at the time, enabling fans to have a more immersive experience as they watched from home or the pub. However, much like 3D cinema and 3D television, it turned out to be more of a fleeting novelty than the “next big thing”.
From Roger’s perspective, “the technology missed two key points about watching sports and what makes it so enjoyable. “The first is that, novelty aside, having an immersive experience actually takes away some of the charm of being an observer, and creates a kind of social barrier between you and your fellow viewers. You’re not completely immersed, but neither are you completely present in your own environment.” Secondly, he adds, “sitting at home (or worse at the local pub) wearing crazy glasses was just too much!”
Having also observed the evolution of virtual advertising technology from its inception and across the industry, Roger recalls his first encounter with it vividly.
“I was in my office in Doha, where I was working for beIN Sports. I had a phone call late on a Friday from a sports marketing agency offering me the “deal of a lifetime”, to place beIN Sports branding on the LED boards at a La Liga game, that would be seen only in the MENA region”
At the time virtual advertising was very new, and Roger was skeptical at first… “honestly, my first thought was that it was a scam”
“I followed up to find out more the following week and discovered that virtual advertising really was a thing. As a tech enthusiast, I was fascinated. It didn’t take long to conclude that if it really worked, virtual advertising would be a game-changer”.
It was Roger’s work in the MENA region that solidified this belief. “It’s a football-mad region… but most of the advertising around the venues in Europe was either in the wrong language for the MENA audience or featured brands that were meaningless in the market”.
Basically, this global approach to in-sport advertising was a waste of the sponsor’s budget, and a waste of prime advertising real estate, as most brands are not relevant to, well, everyone. There was a great deal of money to be made by sports rightsholders if they could find a better way to make use of the misused inventory, and it only served to benefit the brands as well. By splitting the broadcast feed and inserting unique sponsorship messaging into each geographical feed, sponsors could target only the markets that were most relevant to them, or tailor their advertising messaging for multiple different markets.
About a year after that initial call, Roger moved into the virtual advertising technology space himself. He believed widespread adoption of the technology was imminent. “I have to admit that like many evangelists for new technology, my initial predictions about the pace of uptake were considerably too bullish.”
One of the issues at the time was that most virtual advertising companies were offering a hardware-based solution, and this dependence on hardware was, in itself, a barrier to scalable uptake. Even so, one might have thought that the adoption of the emerging software-based solutions would have been rapid, however, the market was clearly cautious. The innovators within the industry were making brave strides, but the rest were slow to follow. “Of course, the COVID pandemic came at exactly the wrong time, stalling live sports production and probably adding a couple of years to the schedule for market adoption. It has surprised me that virtual advertising has taken as long as it has to be adopted at scale, but I do feel that my gut instinct about the technology was on the money … perhaps just 5 years behind my initial, optimistic estimate”.
Roger’s long career immersed within the world of sports broadcasting has given him some key insights into the mindset of the industry and the challenges of introducing a new technology to the market.
“Quality and reliability are non-negotiables in this industry” says Roger. “Media revenue remains the most important income stream for rightsholders, and their broadcast partners will not tolerate a modified signal that looks in any way disturbing for the viewer.”
Basically, the viewer shouldn’t have any idea that virtual advertising is even in use. The virtual content should be indistinguishable from any physical advertising signage around the stadium. Various AI tools are utilized to ensure this is the case. uniqFEED places a huge emphasis on the visual appearance of its virtual content, ensuring that the content mimics the texture of the surface onto which it is placed, such as grass, clay, or sand, and also reacts to changes in light and shade. Similarly, algorithms have been developed to ensure that any player, ball or other object that passes in front of the virtual content, is rendered with precision. Flickering of the virtual content, the ball disappearing “behind” the LED boards, or a player appearing to fall through the virtual signage are all clear giveaways that virtual advertising is in use, and fans are often not forgiving of such errors.
“In the software era of virtual advertising, very few providers can actually do this at the required standard, and only two have this at any kind of scale.” Roger is understandably proud to admit that uniqFEED is one of the two, and is now working with major leagues and federations across a range of top-tier sports, but it has taken a while to get here. Long-term contracts are hard won and relationships and trust are key.
“Away from the technology itself and the challenges there, I think the other big task is to spend time gaining the trust of potential clients and investing the time to build relationships with rightsholders. The sales cycles are getting shorter as more and more executives get experience working with virtual, but it also takes time for the commercial models to be re-engineered to take full advantage of the technology”.
This brings us back to the beginning of this article. Is the market really taking advantage of everything virtual advertising technology has to offer? And if not, why?
“I think we are in the adoption breakout phase now but still the early days of it”. Clearly the market is still figuring out how it can use the technology to its best advantage… “Virtual advertising might be used today by a rightsholder to ensure compliance, perhaps a regulatory requirement in a particular market.”
Regulatory requirements typically exist around products and services such as alcohol, betting, and cryptocurrencies. If we take betting as an example, the rules and requirements for betting advertising as part of a live broadcast vary greatly from country to country. However, a huge number of popular clubs and leagues have betting sponsors. This raises a problem for competitions that are broadcast internationally. Rightsholders have contractual obligations to their betting sponsors in terms of brand exposure, but in some cases that brand cannot be advertised within a certain country’s live broadcast. This presents a clear use case for virtual advertising, which enables the virtual replacement of physical advertising within the venue, By using virtual advertising, betting content can be shown only in those markets where it is permitted, while alternative content can be virtually inserted for the markets where the betting content is restricted.
This, of course, is just one of many use cases. “Rightsholders can also benefit commercially by considering new, virtual-only inventory”, meaning creating entirely new inventory that doesn’t even exist in reality. Perhaps safety restrictions might prohibit advertising content to be placed onto the field of play itself, or onto a ski slope, for example. However, in these cases, virtual content can be inserted for the television audience only, creating no risk or obstruction to athletes. This enables rightsholders to maximize sponsorship revenue by increasing the amount of advertising space that they can commercialize. Similarly, many sports stadiums and sports do not support animated or rotating advertising content, meaning visible brand messaging is limited only to what can be installed prior to the event. By utilizing virtual advertising, animated content can be inserted digitally, and various brands can be rotated throughout the event.
These are just some of the many applications for virtual advertising, but what is the future of the technology according to our broadcast expert? As many do, Roger expects the advertising to become increasingly targeted over time.
“I think the big move will be to shift the targeting denominator from geographic to demographic.” As viewership of live sports moves online, this opens up possibilities for more precise targeting than ever before. The issue with linear broadcast is that an entire geographic region receives the same broadcast feed, so targeting is limited to however many broadcast feeds can be created, but even then, audiences are large and diverse. However, when a viewer streams sports online, they typically access the platform via a user portal. Demographic data is collected at the time of sign up and user behavior data is collected by the platform whenever they spend time on the site. This kind of data is invaluable to marketers who can then use it to further optimize their marketing messaging and campaigns.
And how about beyond that? In what ways can virtual advertising shake up the industry in the future?
Aside from “build it better, faster and easier to use”, Roger thinks that fan engagement will be key, involving a “two-way communication between the advertising content in the stadium and the fans watching”. The advertising content could be optimized over time to align with the kind of content the individual fan is engaging with. This would of course be game-changing for brands, offering real-time engagement metrics and fan data.
Roger’s insights underscore the transformative potential of virtual advertising while acknowledging that the technology is still in its growth phase in the sports broadcasting world. The focus on quality and seamless integration is crucial, and as the technology becomes more targeted and interactive, it seems set to revolutionize how fans experience games and how sponsors connect with audiences. Roger’s vision and expertise highlight that while the path to widespread adoption may be gradual, the destination holds immense promise for the whole industry.
Interested in learning more about virtual advertising? Get in touch with the team.