Brand spending on sports sponsorship is continuing to rise. According to a recent report on global activity published by media analytics company Nielsen, the sponsorship market grew by 107 per cent in 2021. And with a series of major sporting events - including the European Football Championships (women) and the World Cup - scheduled for this year, the upward trend seems likely to continue. But this is a crowded market and for the all-important fans, the focus is always on the athletes and tournaments rather than the corporate sponsors. So how can brands get the most out of their partnerships with rights holders?
As Marcel Blijlevens - Manager of Brand Partnerships at Next Day Media - points out, sponsorship is, at its heart, a very straightforward proposition. "A sponsorship deal buys you the right to communicate with the rights holder's audience," he says. That audience is potentially huge. The European Football Championship is expected to attract 250 million viewers worldwide, an unprecedented number for women's football. Fast forward to the autumn, and FIFA is predicting that five billion people will tune in to the World Cup. But the execution of a sponsorship deal is far from simple. "Sponsorship is not a media buy," Blijlevens adds. "Sponsorship is a very complicated marcoms discipline. Brands need to invest in sponsorship leverage campaigns to get the most of their sponsorship investments."
But what does that mean in practice? Well, the first step is to identify a business case around the sponsorship of an event, asporting body or an individual athlete. Ishveen Jolly is CEO and co-founder of Opensponsorship.com, a platform that enables brands to identify sponsorship opportunities and secure rights. As she sees it, brands need to think carefully about their objectives. "Are you seeking to engage your existing audience, or are you looking for new customers?" She asks. "If you're looking for new customers, sponsoring an athlete might help you to reach audiences you are not currently addressing." Depending on the sport, a sponsorship deal could help you reach an audience comprised of otherwise hard-to-reach young males. Equally a particular sport might help a brand address customers in different geographies or minority groups in the home markets.
The rise of women's sports - as exemplified by the Euros - is also creating opportunities. "Women's sport offers sponsoring brands a new point of difference, '' says Lee Gibbons, MD of specialist marketing agency, Sports Unlimited. It's a space with less clutter and a proposition better suited to landing a purpose-led message - purpose being a territory which 65% of UK sports fans say they want to see more of post-COVID. Purpose is an increasingly important factor in sports sponsorship. Witness a recent deal between Mexican food brand, Old El Paso and Team GB. Announced to coincide with World Olympic Day, the deal sees the brand becoming the official meal supplier for the British Olympic team, while also providing food donations to Fareshare, a charity tackling hunger in the UK. Thus, the deal provides a high-profile platform while also reinforcing values of generosity and social connection.
And of course, an association with sport also helps brands that want to promote themselves around concepts of fitness, wellbeing and environmental concerns. Miles Rose is Commercial Director at the Sweetspot Group, owner of the Tour of Britain (cycling) and the Women's Tour. It has been working with a brand partnership agency to develop sponsorship deals and packages. He notes a trend towards his sport aligning with the corporate social responsibility of brands. "With the growth of Cycling over recent years and the popularity in CSR partnerships, we're seeing an increased interest from brands who seek to create purpose-led partnership campaigns," he says.
The objective of a sponsorship campaign may be to raise sales and there is evidence that this is effective. For instance, Nielsen notes that sponsorships generate a 10 per cent uplift in buying intent. But in the first instance, the focus could be on raising awareness by engaging fans. And an association with sport can play an important part in building trust in a company. Put simply, sporting bodies, teams and individual athletes tend to be loved and trusted by fans. A brand can validate itself by association. That could explain why there has been a rush of sponsorship deals by companies working in the cryptocurrency, blockchain and NFT space. For instance, Coinbase is sponsoring the NBA and Bybit has signed a deal with Oracle Red Bull Racing. According to Nielsen, sponsorship from companies working in this space is set to rise to $5 billion per annum by the middle of the decade. The blockchain technologies that underpin cryptocurrencies and non-fungible tokens (NFTs) are new and little understood. Blijlevens says sport is helping them find a mass audience. "Sports sponsorship can help your brand go mainstream," he says. "The main asset is what we call image transfer."
So there are a lot of very good reasons why brands might choose to invest in sports sponsorship but the key to success lies in leveraging the rights to maximise the impact. The starting point is often a presence at an event. "You will typically find activation zones - such as theKFC Zone or the Coke Zone at the start and finish of events," he says. This presence on the ground provides not only opportunities for sales, giveaways, and direct engagement with customers but also hospitality for major customers, investors and other stakeholders. And according to Adam Goodman, MD of ACA Live - a company that has created live events at London's Wembley Stadium and for The Jockey Club, face-to-face interaction energies sponsorship campaigns. "Live experiences let you engage better with your audience by creating new moments that engage each sense. With the help of brand experience, you can create an ambience that cannot be imitated, recreated, or captured by mere photos or videos and provide people with an everlasting experience of your brand," he says.
So how does that work in practice? Goodman cites the example of American Express, which created a VR experience at the US Open tennis. Visitors were given a chance to return a serve from Maria Sharapova. But what about the wider audience? The fans who will be watching events via TV, phones, tablets and laptops, while also engaging in social media discussions. Ishveen Jolly says the sponsorships should align with the company's broader marketing agenda. "Traditionally sponsorship has been seen as a silo. But it is most effective when it is part of the marketing mix," she says. Thus the campaign should utilise social media, tv advertising and PR. If possible, athletes should be signed up to take part in PR campaigns to get the brand message across.
This isn't always easy to get right. Marcel Blijlevens cites a "sponsorship guru" Kim Skildum-Reid who famously said: "Don't sponsor the property, sponsor the fans." In other words, the sponsorship should be seen - primarily - to be enhancing the fan experience. But a laser focus on a group of fans might not align exactly with wider objectives. In that respect, Blijlevens says sponsorship should continue to be a specialist field, albeit one that uses all the available channels and draws on a wide range of marcoms skillsets The impact of sports sponsorship can be difficult to measure but brands do seem to benefit from an association with sporting heroes. Nielsen found that 81 per cent of respondents worldwide trusted brand sponsorship of sports. That trust factor provides a compelling reason to allocate budgets to sports partnerships.