The excitement of high-profile sports events is often cited as a bright spot in television advertising. Sports is a rare example these days of "appointment viewing," which draws in live audiences who will actually sit through commercial breaks. But during the approaching Olympic Games in Rio, a brand owned by one of Canada's biggest Olympic sponsors is taking its traditional TV advertising budget to zero.
Athletic retailer Sport Chek will have a television presence during the Games: It has inked a paid-partnership deal with the CBC that will allow it to produce "sizzle reels," which will run during the network's broadcast at least once a day. During the Sochi Winter Games, Sport Chek ran seven different television ads; by comparison, this summer the 60- to 90-second reels will use CBC-produced videos to highlight the best Canadian stories from the Games, running during regular programming and sponsored by Sport Chek.
Canadian Tire Corp. Ltd., which owns Sport Chek, has been a Canadian Olympic Committee sponsor since 2013 and splits its Olympic advertising between the Chek brand and the parent company brand. There will be Canadian Tire ads during commercial breaks for Rio, but the parent company is also doing an "integration" deal with the CBC. Spending nothing on TV ads for its sports retail division represents a major change in strategy.
The shift represents not just a change in thinking for Sport Chek, but a larger push among marketers toward what is known as "native" ad content. This shift is under way most urgently in digital media, where users' tolerance for ads has been slipping, and advertisers have responded with attempts to integrate their messages more seamlessly with videos, photos, social media content and articles that people want to see. But it applies to TV as well.
"I'm not interested in a 30-second brand sell," said Frederick Lecoq, senior vice-president of marketing for FGL Sports, the division of Canadian Tire that includes Sport Chek. "TV has to change the way they sell their media to better integrate brands within their programs. … I used to talk to the guy who was selling ads; now I'm talking to the production guys."
This means that TV will make up a significantly smaller portion of Sport Chek's Olympic ad spending. Digital spending will make up about 80 per cent of its entire advertising budget – a major jump compared with the Sochi Games, when only about 40 per cent of its budget was in digital. And more than 60 per cent over all will be devoted to mobile – particularly visual and video content on Facebook and YouTube.
This is indicative of a larger marketing shift at Sport Chek beyond just the Games. The brand is currently in talks with mobile app Snapchat to build some kind of sponsored content within the app for later this year.
For the Olympics, Sport Chek is shooting its videos in a vertical format to more naturally fit a mobile-phone screen rather than the horizontal format that is optimal for TV. An example of that format could be seen in a video that Sport Chek released on Thursday to congratulate trampoline gold medalist Rosie MacLennan on being named Canada's flag bearer in Rio.
Videos such as this will be produced on the fly, in a "war room" within CBC headquarters, to focus on compelling stories as they happen. The reels that will be broadcast on TV will also be distributed throughout the day on Facebook and YouTube and targeted to mobile audiences.
"I can't compete with [Procter & Gamble Co.], I can't compete with Visa. I can't compete with brands that are going to throw hundreds of millions in there," Mr. Lecoq said. "If I own the moment, I believe I can own a share of the conversation. … The whole strategy behind the campaign is to be native in the way you advertise. That's what we're looking for now."