ITV is pushing its IPs into the metaverse and mobile gaming more strongly than ever before. In its drive to connect with lucrative audiences on other platforms, how is it managing to ensure the new ventures deliver value back to the core business?
ITV already has undeniable reach among the 16-34-year-old demographic. That cohort is attractive and valuable for advertisers, and ITV’s IPs like Love Island enjoy significant cut-through among those younger viewers. This is in part why ITV recorded an increase in its ITV Studios revenue in today’s half-year results, with its total revenue up 26% at £798m on the previous year.
But what ITV doesn’t necessarily have at the moment is frequency of contact with those younger audiences. Dan Colton, group strategy and transformation director, says that the broadcaster recognizes the need to speak to those audiences on new platforms, rather than relying on those tentpole programs to draw them back to the linear channel: “What all businesses have learned – and what we certainly have – is that you can’t move the audience.
“You have to go to where the audiences are. Linear TV channels … still absolutely have their moment with those audiences, of course, and it’s still for the big events … but you have to realize they are spending a lot of time in different places.
“They’re spending more time on their phone, they’re spending more time gaming, they’re spending more time just doing other things. And we need to make sure our IP and our presence is in those places.”
The metaverse, gaming and wellness
To reach those audiences and to increase the frequency with which it reaches audiences, ITV has just announced the first three companies to benefit from its Studio 55 Ventures program. The collaboration with strategy and innovation firm Founders Intelligence, announced last autumn, sought to invest in smaller businesses that had the capability of connecting with viewers outside of the confines of linear television.
To that end it has announced investments in companies that specialize in mobile gaming, the metaverse and health and wellness. Live Tech Games specializes in mobile entertainment, creating live, player-v-player, short-form games and transforming them into ‘nationwide experiences’ on phones.
Metavision, meanwhile, is an agency and studio bringing entertainment IP and brands to the metaverse. Its aim at ITV is to lead the expansion of ITV’s IP and brand partners into metaverse platforms, as well as “driving the group’s long-term strategy around the convergence of gaming and entertainment in these spaces”.
Woo, the wellbeing-driven media platform, lifestyle brand and marketplace, is a content-led commercial play across categories such as supplements, apparel, tech and beauty.
Colton says that while all the companies have their own commercial appeal, they share the capability to extend ITV’s IPs into those new mediums. Using the intersection between wellness and content as an example, he explains: “What’s underserved is the interaction between wellness and content, and that’s something that we can really do. We’re very keen with this that we don’t do something completely tangential to ITV, that we actually make use of these core strengths.
“So what’s so important about Woo is that intersection between delivering wellness content, and a wellness marketplace that sits alongside it. If it was just the marketplace, it wouldn’t be as appealing to us.”
The extension into the metaverse comes as Facebook has announced its own drive to accelerate the development of that market, with Mark Zuckerberg arguing it is the successor to the social web. Colton, who notes that he has personal experience with the early stages of the metaverse in games like Fortnite and Rec Room, states that there is significant opportunity in leveraging IPs in the new space.
He cites the recreation of ITV’s The Void gameshow within Fortnite Creative as an example of being an early mover in the space relative to other broadcasters, though he does note that the metaverse is well-established enough to be a growing part of brands’ marketing plans.
The commercial metaverse
The commercial opportunities enabled by Studio 55 Ventures’s new investments are expected to be additive to ITV’s advertising revenues, rather than cannibalizing them.
Colton says that discussions internally at ITV have flagged this as a potential issue, but that he believes brands and agencies recognize that each new medium has a different audience demographic: “We don’t think that the money that advertisers spend on a brand campaign in Fortnite is going to be the same money they would otherwise spend on linear advertising. It’s just not going to be for the same people as that, it’s clearly different people being reached in a different way. Time obviously will tell a little bit because once we start selling those first few campaigns, we can find out.”
The new ventures are currently planned to start rolling out over the next few months and into next year, with the extensions allowed by Metavision currently set to come first.
Ultimately, says Colton, the investment allows ITV to have a hybrid approach to reaching that lucrative demographic in a hybrid manner that doesn’t prioritize either editorial or commercial: “When we went out and said, ‘we want to do more with these audiences’, the easy option is just to go, ‘well, let’s just come up with some good content ideas.’ We forget that.
“It’s really important to us that we focus on things that are extensions of what we’re capable of, but are still brave and still take us into into new worlds, different worlds where those audiences exist.”
As other broadcasters invest in mobile gaming, wellness and the metaverse, there is an advantage to having IPs that can exist well on those platforms. While ITV has previously had success with mobile games based around properties such as Love Island, these investments signal its intention to expand them far beyond linear television, to where younger audiences spend more of their time.