Sports-dedicated streaming service DAZN will begin running advertising and sponsorship placements this year for the first time, the company announced today. The UK-based business has been steadily building up its portfolio of sports rights and expanding into new markets since its 2016 launch, but has so far only monetised its content through subscription fees.
DAZN’s ad inventory will be sold through sales house DAZN Media alongside parent company DAZN Group’s other media brands, which include Goal, SportingNews and Spox.com. DAZN Media will also handle sales for the DAZN Player (formerly ePlayer), a video on-demand (VOD) service which is distributed through third-party sites including Mail Online, MSN, Mundo Deportivo and La Repubblica.
The company sees this combination of multiple sports-based media brands as a key strength of its ad offering. “This is another watershed moment for DAZN as we mobilise the combined strength of our brands, products, editorial and video content together with data-led insights to build a new and innovative way for advertisers to associate with sport and fans at a local and global level,” said DAZN Group’s chief revenue officer James Rushton.
DAZN says it has already signed up a limited number of advertising partners to start, including VW, Tipico, bwin and Krombacher, ahead of a full roll out later this year.
“DAZN has set out to change the way the world sees sport and we now feel that we are in a position to change the way brands engage with sports fans,” said DAZN Media’s EVP Stefano D’Anna. “With the introduction of media placements on DAZN, we are providing brands with the impact of TV, complemented by the targeting and insights of digital.”
Not much detail has been given on how advertising will work on DAZN’s streaming service, which is currently available in the US, Canada, Germany, Italy, Spain, Switzerland, Austria and Japan (the company had not responded to a request for comment at the time of writing). Currently DAZN charges users a flat monthly subscription cost ($9.99 in the US, €9.99 in Europe), but the company has not said whether ads will run on a new, cheaper subscription tier, or whether they’ll simply be added into the existing subscription package with no change in price.
DAZN is spending billions building up its current base of sports rights, which includes major properties like the UEFA Champions League, the Premier League and La Liga in Germany, and the MLB in the US. In recent months the company has invested heavily in boxing too, signing deals with high profile names like Anthony Joshua and Gennady Golovkin. And currently, it sells these events for much cheaper than its competitors – a single pay-per view event in boxing can cost as much as $99 elsewhere- almost as much as a year’s subscription to DAZN.
This strategy has been costly though, with the group recording losses of £214 million in 2017. And while this has all been part of the plan (DAZN Group CEO Simon Denyer has said he’s following Netflix’s high cash-burn model to build up its subscriber base), the move towards advertising might be an effort to minimise these losses.