Nike buys sports prediction app Tally
today Oct 15, 2019
The race is on among the world’s top sports and lifestyle players to acquire the latest app relevant to their market. A few weeks ago, Foot Locker acquired a stake in youth culture e-commerce and content platform Ntwrk. This week-end, US website TechCrunch, a specialist in digital technology, revealed that Nike has bought Seattle start-up TraceMe, which developed the Tally sports prediction app.
TraceMe was founded in 2017 by Seattle Seahawks superstar quarterback Russell Wilson, the US National Football League’s highest-paid player, and digital tech entrepreneur Jason LeeKeenan. Initially, TraceMe was conceived as an app which enabled sports stars to interact with their fans and generate digital content, potentially helping athletes to better manage their media exposure, and the commercial activity stemming from it, than via platforms like Instagram, Facebook or YouTube. The project attracted several investors in a funding round worth $9 million, which included Bezos Expeditions, the investment fund owned by Amazon's boss Jeff Bezos, and Chad Hurley, co-founder of YouTube. According to US media, last year TraceMe had a market value of $60 million.
A few months ago, TraceMe transitioned to a different model, developing Tally, an app enabling users to engage in sporting events by making live predictions about stats, scores and the outcome of individual plays. For example, as a basketball player is about to take a free throw, Tally users are able to predict whether they will score or not. The concept is attractive for sports teams, their sponsors, as well as broadcasters and fans. Among the latter, those most loyal and most accurate at predictions will earn rewards. Tally is a new marketing and commercial tool that leverages the kind of instant access provided by social media.
Nike now owns both apps developed by TraceMe and, according to TechCrunch, is especially interested in the area of direct relationships with athletes. In general, Nike is relying heavily on digital solutions to boost its business. Two years ago, its CEO Mark Parker announced the group wanted to limit to 40 the number of retail partners worldwide, and the share of Nike’s total sales accounted for by e-commerce is expected to rise from 15% to 30% in 2022.
Nike targets 30% e-tail sales share in 2022
Last July, Nike hired Ratnakar Lavu to lead its digital strategy, and is advancing by leaps and bounds in this field, notably via the SNEAKRS app, which allows customers to learn in advance about and register for upcoming new product drops. Nike has been a digital pioneer, having worked on several projects with Apple, and having staged one-off marketing operations too, as for example with Snapchat. Nike is keen to weave a close relationship with its digital customers, telling them stories, providing experiences and giving them a sense of exclusivity. On the performance side, it has deployed the Nike Run Club app, and surely the tools offered by TraceMe, both the sports prediction app and the means for fans to connect with star athletes, are extremely interesting for the US group as ways of driving traffic to its sites.
In the 2018-19 financial year, with the Nike, Jordan, Converse and Hurley brands, the US sports giant generated a revenue of $39.1 billion, and indicated that online sales grew by 35% over the previous financial year.
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