Footytips deal highlights value in online communities

Start-ups are being encouraged to build online communities as part of their CRM strategies, after the owner of social tipping site Footytips was acquired by sports giant ESPN International.

Footytips is owned by Australian company ExtraCorp, founded by Nathan Isterling and Heath Kilgour.

Launched in 1997, Footytips offers social tipping competitions across a multitude of sports including AFL and NRL. The site has attracted thousands of users.

ExtraCorp has been acquired by US pay TV sport giant ESPN International for an undisclosed sum. Established in 1989, ESPN has networks throughout the world.

The acquisition is intended to strengthen ESPN’s digital audience, advertising revenue and local content in Australia.

In addition to managing social tipping competitions, Footytips has developed numerous fantasy games and allows users to chat and socialise through the site, while providing a raft of information around live scores, tipping guides, polls and trivia.

Footytips is completely free – it doesn’t receive any money for tipping competitions and does not facilitate the exchange of money.

However, the highly engaged audience returns to the site on a regular basis; a particularly valuable proposition to advertisers.

According to Mile Morrison, ESPN vice president and general manager for the Asia Pacific, the acquisition will enable the company to further enhance its position in Australia.

“Social tipping is integral to the fabric of the Australian sporting landscape,” Morrison said in a statement.

“Footytips.com.au is an extremely popular tipping platform that combines innovative social media functionality, an innate understanding of the Australian sporting culture and the value of bragging rights to sports fans and their friends.”

According to KPMG digital economy partner Malcolm Alder, start-ups can easily build a community element into their business model, namely via social media.

“Customers are spending more time on social media, discussing brands and experiences with their friends and networks,” he says.

“As a medium, it is not purely ‘social’. It is an increasingly serious business channel for consumers… Australian businesses are not capitalising on this online ‘buzz’ to listen to what their customers are saying.”

Aside from Facebook and Twitter, Online Shopping USA co-founder James Harris says blogging is an easy, cost-effective way of building an online community.

Harris says blogging can bring a community element to a site, allowing the business to develop a two-way relationship with its audience.

“We’re trying to get involved with the blogging community by allowing them to build a presence on our site… We’re focused on building an audience and finding out what that audience wants,” he says.

“It’s not good enough to allow customers to simply buy online – you need that community and social media element.”