Saturday Thought: E-S-P-N

Hello weekend Thinkers.

I’m currently in upstate NY, listening to the birds chirp and the leaves bristle.

If my writing is a bit more zen today as a result, I apologize.

No sponsor today. Check out Sam Ward from Team Snap. I gave her a so-so post last week, so this is some added value. Sam is great and reps a really cool org that helps brands partner with youth sportz. Check it out.

Onto some thoughts, all related to ESPN and their ESPN Bet news.

I’m not going to recycle the typical points about the whole thing, so for a much better analysis on things, please check out Joe Pomp’s podcast on it HERE.

Joe is the man and a great ad partner as well for those of you looking to juice your August numbers.

Here we go…

Saturday Thought(s)

I have three 3 thoughts on the ESPN Bet / ESPN stuff.

#1 is something I’m calling Millennial Inertia (can also be referred to as Millennial Fatigue).

A few years ago, I tried to convince one of my clients (who is a current LTM subscriber!) to no longer target Millennials in our paid media campaigns.

This was a radical thought. The client’s core business was built on and consumed by Millennials. What the fuck was I thinking?

My hypothesis was that the product - a fitness one - was too complicated to cut through a Millennial’s busy life and schedule. They were worried about buying houses, having kids, starting families, getting promoted, saving money, etc. etc. etc. Really - they were worried about just getting through the day.

Did they really have the time, or the want, to buy a new product that would remind them of how out of shape and neglectful they were?

Instead, my pitch was to target younger people looking to get hot, or older people looking to, ya know, keep living.

Fast forward to 2023. Because of all of the shit life is throwing at Millennials, they don’t have as much time or want to try new things.

Hence, Millennials are increasingly set in their ways when it comes to media. The Millennial media channel of choice, podcasts, hasn’t seen a new top 10 podcast in years. New streamers can’t cut through because Millennials already like Netflix. New Marvel movies can’t take hold because Millennials have already been there, done that with Phases 1-4.

Which brings me to sports gambling. Millennials ARE the main target and consumers of online sports gambling. And unfortunately for new entrants, they already have picked the horses they like in DraftKings and FanDuel. We Millennials sat through thousands of ads from these guys in the mid 2010s, and they were the first to burst and retain us on the scene after PASPA was struck down.

Don’t believe me? Look at the market share of every single state and you won’t see another book close to DraftKings or FanDuel’s dominance.

Even Barstool, a beloved entity to Millennials in content, couldn’t break through in gambling. Because just like Millennials are set in their Barstool content consumption ways, we are set in our DraftKings or FanDuel gambling ways.

Which brings us to two new entrants - Fanatics and ESPN Bet. I don’t think either really have a fighting change. Millennials don’t have a strong connection to Fanatics - it’s a seller of jerseys, not dreams, for christ’s sake - and although ESPN brings the nostalgia, Millennials see it as a home for content, not gambling. Actually, Millennials sees ESPN above gambling, given ESPN’s historical distance from gambling topics on-air.

All I hear about is data, data, data when it comes to Fanatics and the power of nostalgia and the brand when it comes to ESPN. But it’s going to take a lot more than either to break through the Millennial Inertia.

#2 is the concept of quality and quantity for brands of different lifestages.

Small, young, or challenger brands are best suited for quality. They are new or different, so they must display quality that people can’t get elsewhere in the category already.

This is compounded by the fact that small or younger brands have less marketing budget to break through, so when they say something, they must make it count.

When done well, it translates to quality of advertising, quality of message, quality of time on-air, quality of product, etc.

On the flip side, big brands rely on quantity. Quantity of ads, quantity of messages, quantity of time on-air, quantities of product, etc. They are too big to control the quality of their product or ad campaigns, too many people and layers to work through to preserve it. It’s more important to remind people of their brand and the quality that once was vs. recreating something new and novel.

ESPN and Disney are currently in the quantity boat. Over the last 10 years, they were the rare big brand that could churn out quality - quality Marvel movies, quality sports experiences, quality parks, etc.

But the quality is no longer there, compounded by the quantity strategy they pursued in building up Disney+ and all of its content tentacles.

Which puts them squarely in the quantity game now. ESPN had avoided licensing a sportsbook for years, because it wouldn’t have been able to control the quality of it. With massively declining cable subs and revenue, it no longer cares - it’s more important to maximize its name, and get its name out there, then ensure a quality product comes to market.

If you work with or manage a challenger brand, pay attention to the quality of your work. And if you work with or manage a bigger brand, ensure quantity over everything to make it hard for the small guys to punch up.

#3 is the Netflix factor that no one is talking about.

Netflix is the rare home of strong non-live sports content. Every other sports network thrives on live content, or talking heads content around that live content.

With the NBA rights up in a year, and the league looking for multiple distribution partners, I don’t see why Netflix wouldn’t get involved. It’d be a great juice to their burgeoning ad tier, they have the capital to do it, it’s a global sport, they can develop strong basketball non-live content around it, and it’d be a kill shot to other networks like ESPN.

Which also makes me think - is Netflix the underrated strategic partner ESPN is lookin for?

Incredible distribution. A global, well liked brand. A hole in live sports content. An ad tier that NEEDs content and NEEDs to succeed, paired up with a network that NEEDs money and NEEDs to keep trucking along.

An ESPN / Netflix strategic partnership makes way too much sense - way more than Amazon, or Google, or Apple, or Comcast.

That was a lot. I’m tired! Back tomorrow? We’ll see…

Stay ThInKiN,

Danny