The NFL looks to virtual reality to grow its audience

Mon, Nov 21, 2016, 2:41 PM

Amid an ongoing ratings decline, the NFL is delving deeper into the virtual world.

This week the league will air a nine-part virtual reality series in partnership with Google to give viewers a “360-degree perspective of life in and around the NFL.” The first episode premieres on YouTube on Thanksgiving; the rest will be available on YouTube and via the NFL app on Google’s new virtual reality headset Daydream.

It is the first time the league has produced original content in virtual reality. The NFL Films series invites fans to “spend a week with the Philadelphia Eagles defensive line as they prepare for the upcoming matchup and gain exclusive access to the Eagles bench and sideline on game day,” the NFL says in a release that also shouts out the Miami Dolphins cheerleaders and the “distinctive football culture in Green Bay.” The series was shot using Jump, Google’s 360-degree camera-and-capture system. In its announcement, the NFL did not give a title for the show.

The move comes at a time where the NFL needs to revitalize its audience for the product on the field. Ratings for primetime games (Thursday, Sunday,and Monday nights) have been down almost every week compared to the same game last season, with the league blaming the election while critics have pointed to everything to poor matchups, stricter penalties, the proliferation of game highlights on social media, and even the national anthem protests led by San Francisco 49ers quarterback Colin Kaepernick.

The NFL clearly wants to be early to the still-nascent virtual reality game, though other leagues have already dipped a toe in. The NBA will broadcast 25 games in VR this season, and last year college basketball fans could watch a number of March Madness games in VR using the Samsung NextVR headset.

“We think this year is going to be a tipping point for VR,” says Brian Hughes, senior vice president of audience and intelligence strategy at MAGNA Global, an ad-buying firm. “It’s a way to bring fans closer to the game, both on and off the field.”

The VR audience is still small but is growing quickly, with the number of active virtual-reality users forecast to reach 171 million by 2018, according to Statista. Deloitte predicted that the VR industry would hit $1 billion in sales this year from combined hardware ($700 million) and content.

Investing in the technology now might bring eventual benefits for the league that extend to industries associated with it. Ed Desser, sports media consultant and President of Desser Sports Media, says that while VR in its current form is far from becoming a substitute for traditional viewing, the advertising impact is compelling.

The NFL “would no doubt get access to a large amount of viewership data,” Desser says. “To operate a virtual reality stream, unlike a traditional broadcast, you get to know exactly who is using when they’re using it and for how long.”

In other words, utilizing virtual reality will allow sports leagues to learn more about their fans and put those insights to use in the future, even if it doesn’t necessarily bring any new revenue or viewership at the moment.

The benefit could go in the other direction as well: attracting the NFL’s audience to VR could be a boon to the growing ad-tech industry in virtual reality. “We also see [VR ads] as the next step in the evolution of advertising, providing an immersive and engaging brand experience, rather than an interruptive one,” Hughes says.

Some advertisers have already begun experimenting in virtual reality. This summer, PepsiCo pushed Mountain Dew ads on VR in part because of Mountain Dew’s connection to NASCAR, a sports that experts say stands to benefit from virtual reality viewing. Pepsi first began experimenting with VR advertising in 2014. Post Cereals also capitalized on the technology this summer, airing Fruity Pebbles commercials on two multi-platform virtual applications.

To be sure, the still-modest size of VR users may be a turnoff for potential advertisers until it gets bigger. Only 1% of PCs on the market can even handle virtual reality, according to Nvidia. And while IDC is forecasting sales of 9.6 million VR headsets this year, Deloitte predicts just 2.5 million—a reminder that sales rates in this industry still vary greatly.

“There isn’t a giant pool of marketers waiting to jump in,” says Paul Verna, senior analyst at eMarketer. “They want to see what happens with the technology, as VR is somewhat of a Wild West.”

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Laura Sanicola is a reporter at Yahoo Finance.

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