Hyperice Leverages Combination Of Sports Properties, Influencers To Build Business
BY ADAM GROSSMAN
One common question we receive at Block Six Analytics is whether it is more valuable for a brand to work with a property or an influencer when it comes to sponsorship marketing. Hyperice’s new multi-year partnership with Major League Baseball (MLB) and the San Diego Padres’ Fernando Tatís, Jr announced last week shows that the answer can be both when used in a way that maximizes ROI.
Hyperice is an “industry leader in recovery technology and pioneer of percussion, vibration, dynamic air compression and thermal technology.” The company’s partnership as the official Recovery Technology Supplier of MLB builds on previous partnerships with the National Basketball Association (NBA), Ultimate Fighting Championship (UFC), and the English Premier League's Tottenham Hotspur.
Hyperice’s now extensive partnership portfolio builds on a strategy of leveraging league partnerships to create differentiation in a competitive market. It is an approach we have discussed in a recent post focused on how Lowe’s uses its NFL partnership to create new products and clearer points of differentiation between its competitors.
Hyperice, however, is not only relying on commercial partnerships to grow its business. The company recently closed a $48 million investment round that values Hyperice at $700 million. A list of prominent athlete-investors originally included Anthony Davis, Rickie Fowler, DeAndre Jordan, Jarvis Landry, Patrick Mahomes, Christian McCaffrey, Ja Morant, Naomi Osaka, Chris Paul, Doc Rivers, Ben Simmons, Kelly Slater, J.J. Watt, Russell Westbrook, and Trae Young.
The strategy of working with players as both investors and influencers is one we highlighted with the impact of athletes such as J.J. Reddick and Chris Paul in Beyond Meat. More specifically, Reddick and Paul organically used Beyond Meat’s plant-based products before either agreed to become influencers and receive stock in Beyond Meat prior to the company’s IPO.
Hyperice’s new relationship with Tatís demonstrates an extension of this approach. Tatís “has used Hyperice recovery and mobility products since he entered the league in 2018.” The “walking highlight reel” is “the first-ever MLB athlete to join Hyperice as an ambassador and investor.”
We have consistently found that organic partnership content from athletes is one of the highest drivers of value from social media using B6A’s Social Sentiment Analysis Platform (SAP). The most valuable form of organic content is when an athlete actually uses a product or service as Tatís has done with Hyperice.
However, Tatís also enables Hyperice to achieve specific goals of reaching customers that may not seem possible at first when considering he plays in the MLB. Hyperice’s latest investment round is focused on using new capital to facilitate growth with new customers in the “sports technology marketplace.” However, a recent Bloomberg post highlights a 2017 Sports Business Journal study that found “U.S. baseball fans are too old, too white and too few” according its author Stephen L. Carter.
The MLB and its partners would likely find fault with this characterization of MLB’s domestic fan in part because of players such as Tatís. Our Audience Inference Platform, which uses natural language processing (NLP) to determine the demographics of virtually any Twitter account’s followers, actually demonstrates that almost the exact opposite true for Tatís as seen in the table below.
AIP shows that Tatís can help Hyperice reach younger and more diverse audiences. His fans are more likely to be under 34 years old as well as Hispanic and Asian as compared with Hyperice fans overall or the base population.
Therefore, Hyperice is poised to achieve success in growing its revenues from $100 million in 2019 to “well over $200 million this year” through its league and athlete relationships. More specifically, its partnership with MLB and Tatís will enable Hyperice to facilitate growth in a competitive market in ways that are unique to its business.