North American sports fans glued to their smartphones are boosting advertising revenues at theScore Inc., and the company says recent website upgrades and new hires have positioned it for further growth.
The sports media company's average active users on its mobile platforms reached nearly 9.2 million a month, the company said in its fourth-quarter results released on Wednesday. That's a more than 150-per-cent increase in traffic over the same time last year.
Two years ago, theScore sold off its television network to Rogers Communications Inc. for $167-million, setting the business on the path to transformation from a mature, cash-generating broadcaster into a digital-focused newsroom that targets sports fans' smartphones and tablets, providing game updates, news and analysis. Its app business is up more than 40 per cent over last year.
Today, the Toronto-based company is reaching more people on mobile than it ever did on TV, housing about 40 journalists that pump out 300 to 400 pieces of sports-focused content and updates to mobile devices every day. Between 50 and 60 per cent of mobile visitors to theScore are from the U.S., and the app ranks among the top three sports offerings south of the border, often coming second only to ESPN.
"We will rival the biggest brands in sports in the new digital and mobile environment," says John Levy, theScore's chief executive, whose family founded the cable and TV business that became theScore. "A huge wave of advertisers are moving into the mobile space. It's where the eyeballs are."
theScore has spent much of the last year building out its foundation for growth, redesigning its website for mobile users and hiring four new social media experts for its marketing team. It has invested heavily in technology and engineering that allows for rapid publishing of news and real-time sports updates.
theScore makes its money from ads sold to companies such as Nike Inc. and PepsiCo Inc. Revenues hit $7.8-million for the year to Aug. 31, up 47 per cent over last year.
The fast-growing user base has helped theScore start to attract "big wins" with North American advertisers, which may have previously preferred to target potential customers through companies that provide content on many platforms, such as ESPN or FOX Sports Networks.
theScore has begun to succeed with "premium advertising" offerings, such as custom content where advertisers pay for posts. One recent example was a partnership with Reebok on the first Saturday of the new hockey season. The athletic wear company paid for a series of articles about endorsed Pittsburgh Penguins player Sidney Crosby and the start of the new NHL season, written by hockey writers including editor Justin Bourne.
While theScore's presence in Britain and Western Europe is growing, the company is targeting North American advertisers where it has scale and advertisers are willing to spend, said Benjie Levy, theScore's chief operating officer and Mr. Levy's son.
He notes that "We're not just building an audience, we're building a business."
While lucrative ad deals have increased, theScore hasn't yet turned a profit. The company posted an earnings before interest, taxes, depreciation and amortization loss of $8.4-million last year.
But Mr. Levy said he is confident the company will still meet its goal to be profitable within the next four years. To ensure it has the cash to bolster operations until then, the company raised $17.3-million from the Levy family and other backers this year.
And theScore is learning as it goes, cutting back less successful ventures such as long-form feature writing. "It wasn't that the content was bad, we liked [the writers] a lot. It just wasn't content that could be consumed on the go," Benjie Levy said.
theScore also experimented with mobile video after the sale of its television channel, but the potential ad revenue wasn't enough to justify the costly production.
The big challenge now will be connecting existing and new sport fans with theScore's brand, and keeping up with how fans want to consume sports news.
"We look over our shoulders and we don't see anybody that's come close to us. It's not a matter of arrogance, it's a matter of staying on top of what's happening," Mr. Levy said. "The trick is not to lose focus."