Although on the radar screens of marketers for some time, the members of Gen Z—complete with consumer behavior radically different from their elders—have reached critical mass, with the oldest now entering their mid-20s. This is a critical time for sports to address what some have called its Gen Z “problem.”
Put simply, the issue is that 12-to-24-year-olds don’t have as much interest in, participate less frequently and watch far fewer hours of live sports events than Millennials, Gen Xers and Baby Boomers. Conventional wisdom is that sports risks losing this generation to other interests and activities, which would have devastating consequences.
But although that risk cannot be ignored, the “problem” is easily overstated and is better considered a “challenge,” albeit a particularly sticky one.
Research shows that Gen Z has not turned its back on sports—far from it. It simply does not embrace it as robustly as older generations do and consumes it in vastly different ways. For example, an ESPN study cites 96 percent of 12-to-17-year-olds identify as sports fans, but the percentage describing themselves as “avid” has dropped from 42 percent to 34 percent. Data from Morning Consult shows that only 25 percent of Gen Z respondents said watching live events was “an important part of being a fan” versus 44 percent of all sports fans who felt that way.
By now it is not news that young adults don’t want to watch hours-long matches and games, that they want portable, sharable content delivered to them on their favored platforms, and their interest lies in experiences, personalities and engagement rather than wins, losses and stats. Yet that is still what many refer to as the “problem.”
It has been suggested that delivering content through OTT services versus traditional broadcasters will help in this regard. But as Bo Han, founder of nascent sports viewership app Buzzer, said in the Morning Consult article, “In concept, streaming is great. But we’re repurposing a linear format that makes sense on television onto the mobile screen and expecting the same results.”
Han says a different approach, one he calls “live short-form,” is needed to cater to Gen Z fans on their mobile devices.
That may be so, but as Dallas Mavericks owner Mark Cuban pointed out in the same piece, the current challenge is how to present clips and other non-traditional content in a way that “qualifies for ratings.”
Those three words of Cuban’s get to the heart of the matter: Sports doesn’t have a Gen Z problem as much as it has a monetization of new channels problem.
Live viewership is the engine that drives sports, with media rights and ticket sales the chief revenue generators. Sports can either try to convert Gen Z into viewers of live events in traditional ad- and sponsorship-supported formats—a futile undertaking—or it can start the work of changing its business model and find new ways to monetize a new audience.
This is an extremely tall order to be sure, but what is the alternative? A Two Circles report projects that by 2024, the value of short-form video will grow dramatically to $3.2 billion but will still be less than the value of live rights by a measure of 15X. Given Gen Z’s consumption patterns, that is simply not sustainable.
Even though that ship cannot be turned around quickly, there are steps sports rights holders can take immediately to begin to figure out how they can meet the needs of Gen Z fans. Through both sophisticated data analytics and traditional market research tools, sports properties (and their brand partners) must do a better job of unearthing actionable insights into their fans’ customer journeys, behaviors and lifetime value—and in particular understand the many differences between digital content consumers and traditional ticket buyers and TV viewers.
Armed with that knowledge, rights holders must then update their marketing and sales functions to ensure they are offering relevant content and products, as well as communicating with the right targets at the right time with the right, i.e., personalized, messaging.
(To hear more about teams’ efforts in this regard, check out the Ticket Manager All Access Interview Series conversations with Jacob Gallagher, CRO of the Charlotte Hornets and Chad Johnson, Chief Content Officer and Senior Vice President of Sales and Service for the Jacksonville Jaguars.