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Giant soccer clubs have a new way to turn their social media content into cash

Obsession
Business of Sport
Obsession
Business of Sport

A new website called Dugout that involves some of the world’s biggest soccer clubs has launched today. It has been likened to a Facebook for soccer, with clubs and star players from various leagues posting goofy videos of their antics off the pitch directly to fans around the world.

“Football fans are hungry to discover the latest news and content from the game they love,” the new site’s co-founder Elliot Richardson said in a press release announcing the launch.

Dugout plans to make money by showing ads to its users. Sky News reported that clubs—among them Barcelona, AC Milan, Manchester United, and Bayern Munich—have equity in the business and will receive half of its revenue, in exchange for getting players to set up profiles and for providing special content. It has the backing of Philip Green, the retail magnate who runs Topshop and other brands.

If enough fans sign up, then Dugout has a shot at grabbing some of the marketing and advertising dollars that currently flow to social media platforms like Facebook, Twitter, or WeChat. These platforms can promise brands that they have the data and the tools to deliver ads to sports fans in a variety of tightly targeted ways, including to supporters of specific teams.

The business of marketing to American football fans is instructive. Google’s YouTube video platform, for instance, shows viewers ads containing products, like a can of Budweiser beer, personalized with the logo of the viewer’s favorite team, the New York Times (paywall) reported. The Bud Light brand spent $57 million on advertising during last year’s NFL season, according to the Times, citing Kantar Media data.

Marketing to sports fans on social media makes sense as cord-cutting continues to gain momentum. Twitter, for instance, is investing in live-streaming deals with the NBA and others to turn itself into a destination for watching a game live, and for participating in the chatter around it.

Dugout’s other promise is that it will carry exclusive content—for the first 24 hours, anyway—from star players and top clubs. This exclusivity clause mirrors that of content producers in another, highly competitive and social-media-savvy industry: music. As music streaming has evolved, some stars have responded by making albums or tracks exclusive to a particular platform for a limited time. The gamble has paid off so far, with artists and the streaming platforms reaping the dividends from the rush for content.

It’s unclear how Dugout will compete against the network effects of existing social media behemoths like Facebook and Twitter. The new platform has only rudimentary interaction features, like the ability to comment on a piece of content, or to select an emoji-like response, much like Facebook reactions. There are no live-streams, stickers, or animated GIFs, unlike on Facebook. Users can “follow” clubs or players, much like Twitter, but it lacks the unfiltered immediacy that Twitter offers.

Dugout is projecting revenue of over $75 million in its second year of operations, according to internal documents seen by Sky News. That’s a big ask. Research firm Hookit ranked clubs according to the media value generated from their social media accounts. It found that FC Barcelona, a Dugout partner, topped the list with an estimated $25 million. To hit its target Dugout would need to capture almost all of that value, even while Barcelona is still on Facebook and Twitter and other platforms, and do the same for other teams.

Dugout will have to hope that social-media staffers for players and clubs have the enthusiasm for pushing out content to yet another platform.

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