Online Sports Spending To Hit $1 Billion By 2011

Marketers will spend some $727 million on paid search and rich media ads on sports Web sites in the U.S. next year--up almost 33% from this year, reports eMarketer. And while advertiser spending on the Beijing 2008 Olympics will fuel much of that bump, the upward trend is slated to continue, pushing sports site ad revenues to top $1 billion by 2011.

When it comes to sports advertising, broadcast television is still king, as it will rake in well over $6 billion--or 63% of all U.S. sports ad revenue in 2008. In comparison, advertisers will spend just about 7% of their sports marketing budgets online next year--but analysts say they will continue to increase their online investments, as the Web serves as a highly engaging, customizable supplement to their overall media plan.

"Advertisers are including Web sites in their sports ad mix because they can create offerings that are much more demand-driven," said Paul Verna, senior analyst, eMarketer. "The ads are integrated with the sports info that people are actively seeking out, like stats and scores," and these off- and online campaigns are becoming the norm rather than the exception.



The popularity of fantasy sports leagues has also drawn advertiser attention, as the fantasy games bring in between 15 and 18 million players each year. In 2006, marketers spent $150 million on branding and advertising deals with these online communities, and analysts are forecasting the dollars to continue to flow.

"Fantasy sports are a natural tie-in for advertisers," said Verna. "With sponsorships and ads in these fantasy networks, there's an opportunity to get these really passionate fans to engage with a message--as long as it's really tied to the sport."

Sports news and events drive traffic to fantasy sports sites as well, garnering more eyeballs for rich media and paid search ads. comScore reports that traffic to the Major League Soccer Web site grew by 250% from December to January, following the announcement that superstar athlete David Beckham would be playing soccer in the U.S. The number of unique visitors to the MLS site in January 2007 reached 808,000, up from 230,000 in December 2006.

Streaming video is the only questionable component in the online ad spending forecast, as user adoption of online video for sports has been slow. The eMarketer report found that only 11% of consumers "were likely" to stream sports clips, compared to almost 50% that "were likely" to stream news clips and music videos.

The quality and price of the content featured factors into the online video equation with sports--much more than any other genre according to analysts. "Video quality does matter with sports," said Verna. "And there's also the social aspect of watching a football or baseball game."

In addition, the growth of online video has largely been fueled by short-form programming, and sports games are often two or more hours long. They also have remained a stronghold of appointment viewing.

"People like watching games live," Verna said. "We're so used to time-shifting and controlling how we consume content, but with sports, its so of-the-moment, that we're still watching when they tell us to. It's pretty rare."

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