21.07.2014

IS DIGITAL A FOE FOR RIGHTS HOLDERS?

Following on from my previous blog, where I explored the commercial opportunity that digital rights presents for rights holders, there is also an argument to suggest that the evolution and fragmentation of digital does indeed pose a threat for rights holders.

The primary threat is that rights holders run the risk of losing relevance with existing and potential sponsors across digital and social media, with brands arguably able to bypass the rights holder to reach their digital audience. There’s no more timely example of this than the recent World Cup, where a multitude of official sponsors and competitor brands have all been vying for their slice of the reach and engagement pie, with ambush activity prevalent as detailed in our own Jen Sampson’s recent blog.

Looking at digital leverage and ambush, the battle of Sony (as an official sponsor) vs Beats provides an interesting example. Sony, recognising that no longer can they simply rely on traditional big ticket sponsorship rights of signage and brand association to deliver a return on investment, released the hub of its 2014 FIFA World Cup activation – a brand-created social network called ‘One Stadium Live’. The platform allowed football fans around the world keep track of all tournament-related posts and news feeds along with fan challenges to encourage content sharing. Beats, with no official rights, focussed on a content sharing strategy underpinned by big budget production and brand ambassadors. Based on an initial ambush marketing analysis of the World Cup, Beats overshadows Sony for brand affiliation in relation to the event.

Both the Sony and Beats strategies provide a unique situation for rights holders, who obviously are after the very same digital audience to engage with them via their own digital platforms, to ensure the investment the likes of FIFA asks of commercial partners for digital rights is justifiable.  Rights holders need to be in a position to deliver the necessary digital audience and engagement platforms to sponsors if they want an investment. Of course an opportunity does exist here that, as is the fundamental basis of any true partnership, that when a rights holder and a partner can work together to deliver a digital fan acquisition and engagement strategy then both parties will benefit. Although it raises the question as to what happens at the end of a commercial relationship should a sponsor exit the property – who does this audience belong to? It’s critical that rights holders retain the rights to such platforms and audience in any sponsorship agreement to ensure that both the rights and investment made to date can continue to be leveraged by the rights holder and offered as a commercial opportunity to incoming partners.

Just like any other brand development and audience building exercise for a rights holder, digital needs a resource focus to effectively allow rights to be developed and commercialised. And although this cost can be perceived as a barrier to entry for rights holders, the beauty of digital unlike many other channels is the relatively low cost of investment. It affords rights holders the opportunity to invest a little but learn a lot about what platforms are right for the audience. And the reality is that the speed at which digital evolves presents its own unique set of opportunities and threats. Long-term digital rights deals are a risk for rights holders and sponsors alike. What is compelling, engaging and commercially viable as a digital platform for fans now may be obsolete in the space of a season or 2 as the digital landscape consistently evolves. Rights holders need to be forward thinking, innovative and flexible in their approach to digital rights and commercial partners.

So whilst it can be argued that the evolution of digital can indeed be considered a foe to rights holders, the key take out is that rights holders need to be in to win it, and that the benefit far outweighs any perceived threat. To quote another World Cup Sponsor, are you “all in” when it comes to your digital strategy? If not, get in touch!

Mongoose is working with brands and rights holders in digital you can learn more here

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