Google’s former Chairman Eric Schmidt called advertising the “last bastion of unaccountable spending in corporate America.” He’s wrong, but only because there remain others.
While I studied finance, I’ve earned the lion’s share of my lifetime earnings directly and indirectly via advertising: either selling ads, or creating value as a result.
As I alluded to in The CRO piece which looked at the evolution of content and advertising throughout the birth of search, rise of social, emergence of video platforms and the mobile revolution, I’ve also found myself on the other side of the equation buying advertising. Now granted, the ratio is something like 50:1.
Today, I’m seeking ideas for advertising, in particular, sponsorships.
Left to my own devices, as a 42-year old, I wouldn’t exactly run ads in print or buy TV ads, but let’s face it, the world of media and advertising have changed profoundly, so I’m opening up to get pitches which I will then share with my team.
A Tale of Two Extremes
From my days at my old job and company spending $0.01 per click in search engine marketing (SEM) campaigns to dropping hundreds of thousands of dollars in sponsorships at WatchMojo, we’ve certainly come a long way, baby!
From The Closer, indeed my first advertising efforts involved SEM before anyone had caught on to what has become arguably the most effective advertising technique ever, search ads:
The “racket” at owned-and-operated (O&O) websites was the typical playbook: 1) produce articles, 2) publish them on your website, 3) adopt i) white hat search engine optimization (SEO) tactics and 4) then sell ads against it. Ideally, sell them direct to marketers and ad agencies, but once our traffic soared to 5M unique users who generated some 200 million page views, rely on ad networks to increase the fill rate. We had a very good marketing/SEO team which led to organic traffic growth. Coming from the search industry, I introduced ii) search engine marketing (SEM) tactics at the onset of the sector: I would buy quality traffic for $0.01 on GoTo (then renamed Overture) and then Google (for more than that, $0.05 I recall) before the world caught on and inflation set in. I probably should’ve followed my gut and bought Google shares at the IPO, but was in the trenches making money the old way. Either way, our inorganic traffic growth came from our old-school iii) “business development” deals with AOL and MSN (Yahoo always proved elusive, though I’d seal that deal later at WatchMojo) who would a) feature the headlines of our articles on their main pages, b) house the first half thereof on their portals and c) then drive massive amounts of traffic to our websites.
Since starting WatchMojo, apart from a few small tests, we never bought ads. In 2016, we celebrated our 10-year anniversary. I went ballistic and expanded in a myriad of ways. At the time, we’d just hired a sales executive and we wanted to “change the conversation” and perception of being “just another YouTube channel.” Not that there’s anything wrong with that, of course.
Being a global brand headquartered in Montreal, I was looking for something that was a bit of a diamond in the rough and would help us punch above our weight.
Advertising is a fickle beast: “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half,” quipped John Wanamaker. He’s kind of right.
Companies that command a premium in valuation do so because of Goodwill, or brand equity. Brand equity comes from many things – quality product, outstanding service, as well as advertising. I’m pretty maniacal on vision and the Why, but pretty flexible on the Mission, or the What/When/Where. For the difference between Vision and Mission, read this. I am also growing far more militant regarding the Who as I become more mature.
For a company like WatchMojo that never spent any meaningful amount on online advertising & grew its audience organically with a global audience of 150 million viewers in 150 countries, why decide to drop all that money on sponsoring a sports team?
As success is relative, subjective and fluid, it’s important to understand the objectives of each initiative. When you sponsor something, you have to be comfortable knowing you may not be able to track the ROI. It’s a bit like investing, you have to be fine with losing your money.
As mentioned, I wanted:
1) a hospitality tool that my NY-based sales team could use to schmooze clients;
2) to “change the conversation” that we were just a YouTube channel, even though we were indeed the house that YouTube built as YouTube became our favored nation. Recall before we made our big bets and built the business on YouTube, we had wide distribution across the portals, amongst the first digital media providers on Hulu and so on.
3) global visibility ideally, but was fine to settle for North American (or at the very least national) exposure.
4) the double take factor, when people would almost be taken aback. I’d like to say I didn’t care, but when the first Islanders/Montreal game aired in the city, it certainly made a lot of local folks pause and wonder: “that f*cker pulled it off.” A sample email from that night:
It was akin to those folks who’d transitioned from “good luck with that ‘business,’ pal,” to “I always believed in ya, buddy!”
The irony of it all is TV remains somewhat exclusive and offers a certain cachet. When the Isles’ match would air on on NBC for example, we were getting massive exposure, and due to the placements, even the locally-aired games on MSG got us visibility during highlights.
5) a good deal. As an entrepreneur who’d bootstrapped the business and gone deep into debt before we broke-even, I wasn’t going to spend recklessly to appease whatever insecurities fuelled my ambitions.
6) a treat: Something I could use when in town to treat friends and business acquaintances. I’d nearly killed myself building the business (physically, emotionally and mentally), I was in NY pretty frequently, so this was a welcome change from what I usually would do when in town.
In Montreal, when it comes to premiums you pay, the NHL’s Montreal Canadiens command top dollar. Montreal is religion here. Once the MLB’s Montreal Expos left, we lost whatever competition there was for such visibility across North America. Our soccer team has recently grown in stature, the CFL will always play second fiddle to the NFL. But not being a local business, nothing really made sense in our backyard. There’s the Formula One… of course, but I like my organs.
At the time, nothing really made sense, period. As my colleague and I began to flirt with some options, we saw a sort of “arbitrage” opportunity emerge with the NHL’s New York Islanders who played at Brooklyn’s Barclays Center.
Growing up, I never held much animosity for the NY Islanders or the NY Rangers. In fact, until the Rangers’ Chris Kreider nearly killed Habs goalie Carey Price in the playoffs, I even liked the blue shirts to some extent, predating the Mark Messier era, when Bernie Nicholls would electrify fans with his scorer’s touch. In any case, as a media company, and as an entrepreneur who was always flirting with relocating to NYC (we lived there for most of 2008-09 and before the pandemic I was in the city 25 times per year), NYC was a natural area for us to zone in.
If you want to do anything in media & entertainment in NYC, unlike Montreal you have choices. If I had to guesstimate the cost of advertising amongst the NY-based teams, I’d venture the most expensive to the least expensive to be:
- NY Yankees (MLB)
- NY Giants (NFL)
- NY Rangers (NHL)
- NY Knicks (NBA)
- NY Jets (NFL)
- Brooklyn Nets (NBA)
- New Jersey Devils (NHL)
- New York Islanders (NHL), partly because they’d been orphaned from their home in Long Island at Nassau Coliseum and relocated to the Barclays.
For us, the move to Brooklyn was a god-send, since so many media buyers and ad agency employees live in Brooklyn.
It’s the little things
When we got the proposals, clearly the Isles’ offer was the most enticing… Even though by then we were no longer the insolvent and money-losing little startup of days gone by, I recall paying for the sponsorship with my corporate credit card (the one I crudely referred to as Jenna Jameson in 10-Year Overnight Success):
The way we’d structured it, we had included hospitality elements as well as on-air components, getting a lot of mileage during matches with a fairly visible board (dasher) signage. To their credit, I’ve attended many arenas and stadiums, more hotels than I want to admit, and the Barclays’ service was excellent. The third game of season ended in overtime; they were playing this epic goal non-stop during SportsCenter:
Because the team was in transition from Nassau to Brooklyn, I suspected there were many placements in flux, so we also secured this epic sign behind the coach after games:
We remained a client for three seasons, from 2016-18. I would candidly say the:
- first season was a steal,
- second was a case “it ain’t broken, so why fix it,”
- third season may have been diminishing returns, but overall it did help us secure business. How much that could be attributed by way of causality is hard to determine, but based on correlation the results were clear: the US Army in one of our biggest direct ad deals, Rockstar Games, Paypal etc.
On the night we entertained the US Army team at Universal McCann, we partnered with the Barclays’ team to produce this gem:
The thing is, once you start to place ads anywhere, every single competitor to that “anywhere” will pitch you something similar. In doing so, it validated what a great deal we’d had (no, this isn’t an ad for the NY Islanders sales team!). Well before that third season, MSG and the much more expensive and visible NY Rangers began to court us heavily. I’ve always had a very weird sense of loyalty, some of which I have discussed in the Insecurities series, much of which stems from my roots. Ultimately, partly out of loyalty, I decided to renew that third season with the Isles and not move our business over to their arch-rival Rangers (loyalty was admittedly only part of the rationale).
As someone who’d always been drawn by the Big Apple, there was certainly some pride involved in envisioning the WatchMojo “flag” hoisted atop Madison Square Garden, the busiest arena in the world. But, when I say mankind’s course to success is a balance between staying good and resisting giving in to the forces of evil, it doesn’t mean death and destruction, but more seemingly benign sins like hubris and envy, too. As much as it would have been a source of pride to see us plant our flag atop the world’s highest peaks, it simply didn’t justify the cost, so I balked. But man we had some great times catching Rangers’ games, which were always packed and electrifying.
What would you do?
One day, I envision WatchMojo having a billboard in Times Square. In fact, with the pandemic making Times Square a ghost town, there may not be a better time. Inasmuch as an investor you “want to be fearful when others are greedy and greedy when others are fearful,” as contrarian as it seems, now is arguably the best time to buy a billboard slot for a long term contract. I’m not saying we would do it, but if a brand were ever interested and it made sense, I assure you now’s the time to find a bargain.
All to say, I’m not itching to pursue a sponsorship deal now. But I’m open to it.
I’m definitely not suggesting we would want to sponsor a team. Maybe if we were inclined, we ought to explore sponsoring an eSports team or running virtual billboards in Roblox or some new frontier.
But if it’s not clear to you by now, if you have any great ideas that match (and then some) that criteria I shared… hit me up.