The latest trends in sport sponsorship
The market for sport sponsorship has grown exponentially over the last decade. At present, global sport sponsorship has an estimated value of €38 billion, and this is expected to exceed €40bn by 2020. Consequently, sponsorship has become a critical revenue stream to exploit for modern sport businesses if they are to gain competitive advantage.
It is testament to the importance of sponsorship that sport businesses are constantly striving to offer innovative new ways of providing exposure and value to brands. This approach has led to an ever-changing market, while being responsive to the latest developments hasbecome key to commercial success.
We have observed some notable trends across this fast-moving industry that we expect to continue in the coming years. These developmentswill have important implications for the very nature of sport sponsorship, and are thus crucial to consider for all interested stakeholders. In no particular order, we will now discuss each trend.
There has been a marked increase in investment from Asian companies in sport sponsorship. Nowhere has this been clearer than at major sporting events. Notably, 7 of the 12 major partners to the 2018 FIFA World Cup were from Asia. This represents a significant movement from previous tournaments where the majority of sponsors were North American or European. Furthermore, with Japan chosen to host the forthcoming Rugby World Cup and Olympic Games in 2019 and 2020 respectively, the ascendency of Asian companies in the sport sponsorship market is only set to continue.
It is not just the major sporting events, however, that are experiencing a growing Asian presence. Asian companies are now ever-present on English Premier League football jerseys. For the 2018/19 season, 8 of the 20 main-shirt sponsors will be head-quartered in Asia – a rise from only one sponsor in the 2003/04 season. This shift towards Asia is symptomatic of the region’sgrowing economic power (relative to the West), and will continue to manifest itself in sport in the coming years.
Technology is likely to be the most influential factor in the development of sport sponsorship. By adopting and using the latest technologies, both parties in a commercial partnership (the sports club and the brand) have a wealth of new options available to them to maximise their return on investment. For instance, social media, with its unending ability to offer international exposure, is now a staple tool used by sports clubs.
Although the concept of social media is now old, its applications are not. Channels such as Snapchat and Instagram are proving adept at creating a more integrated and immersive fan experience. This is where the real value exists for brands, as their potential to interact with consumers now transcends billboard or front-of-shirt sponsorship. Now, connected stadiums and screen-obsessed societiesallow sponsors to engage with fans before, during and after sports matches.
The introduction of virtual reality is also close, and this technology is where some of the most innovative sponsorship strategies will be deployed. Companies will have the opportunity to (literally) bring their brand to life in virtual stadiums while fans watch their favourite team live from the comfort of their own home.
In 2016, Manchester United took a novel approach to announcing Paul Pogba’s transfer to the Club. Pogba, alongside English rapper Stormzy, collaborated on a music video that revealed the news. To maximise impact, the video was released before established media outlets had the story, and Adidas were placed at the centre of it. This clever marketing strategy, which involves superstars crossing over to new settings, is symbolic of a modern and interconnected world.
For brands involved in sport sponsorship, industry crossovers are appealing because they facilitate exposure in new and diverse contexts. Large sport brands such as Adidas – particularly with its ‘Here to Create’ campaign – appear to be the first-movers in this area. However, there is scope for smaller brands to utilise this powerful approach, and we can expect to see more inter-industry collaborations in the near future.