In the world of professional sports, sponsorship represents a significant source of revenue and plays a vital role for the successful operation and growth of clubs and sport organisations, both at a local and international level. Within sport marketing, sponsorship is one of the crucial tools brands use to expand audience reach and gain new clientele, associating their name and image with popular and successful sport organisations or individual athletes.
Sponsorship in sport essentially allows the sponsor to “borrow” the attention of the sport entities’ audiences and start building a rapport with them. This can be done in various short- or longer-term arrangements: by displaying a brand’s name and logo on a club’s or athlete’s sporting equipment, in different locations in a sporting competition venue, becoming an official supplier for a sporting event, buying media rights for a tournament broadcast, or naming rights for a stadium.
Have you heard of the saying that “football is the most important of the least important things in life“? Well, it seems that football is no less important within sport sponsorship. Due to the extraordinary global popularity of the sport, today, some of the biggest sponsorship deals involve football organisations and players. FIFA has reported record revenues of US$7.5 billion during the last four-year commercial cycle 2019-2022, concluded with the Qatar 2022 World Cup (over US$1 billion higher than the figure for the previous cycle concluded with the 2018 Russia World Cup). Qatar World Cup also produced record-high viewers’ attention: the organisation said that 1.5 billion people watched the finals, while the World Cup related posts on social media scored a cumulative reach of 262 billion across all platforms.
The importance of sport sponsorship makes it an unavoidable topic within sport management education. Such is the case also with AISTS’ Master in Sport Management and Technology, where Prof. Björn Walliser’s course Sport Sponsorship teaches the key concepts of effective sponsorship strategies, how to measure the return on investment in sport sponsorship and provides real-world examples of creative sponsorship campaigns; topics discussed briefly in this article.
The beginnings of sponsorship in sports
The concept of sport sponsorship is as old as the ancient Greece and Rome, where wealthy individuals used to fund festive games with the aim to gain favour and popularity among the people. The modern form of sport sponsorship had its beginnings in the late 19th through to mid- 20th century. In 1880s, a tobacco company from Louisville, Kentucky, sponsored a professional baseball team, Louisville Colonels, providing the team with uniforms that prominently featured the company’s logo and name. In 1902, Slazenger became the official tennis ball supplier of Wimbledon, marking the start of a partnership that continues to this day. The first sponsorships of sport event media coverages happened with radio broadcasts of baseball matches in the US in 1920s. 1928 is considered the beginning of the modern era of sport sponsorship with Coca-Cola’s epic partnership with the Olympics. Of course, with the evolution of marketing and especially digitalisation, new opportunities and formats for sponsorship activities were born.
Fundamental Concepts of Sport Sponsorship Strategy
Sponsorship in football entails a strategic partnership between a brand and a football entity, wherein the brand offers financial or in-kind support in exchange for promotional benefits. Let’s briefly discuss the key concepts that make part of every football sponsorship deal.
Establishing clear sponsorship objectives informs and directs sponsorship activities. Sponsorship objectives can be enhancing brand visibility locally or globally, reaching target audiences, driving sales, or supporting community initiatives.
Brand Identity and Target Audience Alignment
Aligning the key values and brand identity traits of the sponsoring brand and the sponsored entity, as well as the interests, demographics, and values of their target audiences is crucial for effective sponsorship activation that will benefit both parties.
As said, sponsorship objectives and the traits and behaviour of the target audiences will affect the design of the sponsorship activation plan. One sponsorship deal can include many different offline and online marketing activities, including social media campaigns and experiential marketing, next to the more traditional formats.
In order to maximise brand exposure and mitigate risks, big brands usually create diversified sponsorship portfolios where they engage with various football entities, including clubs, leagues, tournaments, players, and community initiatives.
Measuring Sport Sponsorship ROI
While on the one hand sponsorship funding may be of crucial significance for sport organisations, the benefits for the sponsor are many. Brands engage in sponsorship deals with prominent athletes, clubs and organisations to enhance the company’s visibility, foster goodwill among the team’s devoted fans, and boost loyalty with their own customer base when brand identity alignment is done well.
Measuring the return on investment (ROI) in football and any sport sponsorship can be challenging. Like with any marketing activity, proper metrics to measure need to be chosen in line with the sponsorship objectives. For example, media equivalency indicators are a set of metrics commonly used to assign a monetary value to the visibility and coverage a sponsor receives in various media channels, such as television, radio, print, online, and social media. This is typically done by comparing the sponsorship’s media exposure to the cost of purchasing equivalent advertising space or airtime. This estimated cost is then attributed as the media value of the sponsorship exposure. Still, media equivalency indicators are often seen as an imperfect measure of sponsorship value, as they essentially only compare the cost of the sponsorship deal to the traditional advertising costs, and do not capture the full range of benefits and return on investment that a sponsor may gain from a sponsorship, such as brand association, fan engagement, and long-term brand loyalty.
While media equivalency indicators can provide some quantitative insights into the visibility of a sponsorship, it is advisable to complement this approach with qualitative assessments and other metrics that capture the broader impact and effectiveness of the sponsorship, such as brand surveys, social media engagement, website traffic, and sales data.
Creative Sponsorship Formats
Exploring real-world case studies on sponsorship activities is usually the most interesting part of learning about sport sponsorship and sport management. In a competitive sponsorship landscape, finding innovative and creative formats can help brands stand out.
Here are some of the commonly used, plus some more modern sponsorship formats:
- Shirt Sponsorship: probably still the first form that comes in mind when we talk about sport sponsorship. Placing a brand logo on the front of a team’s jersey provides extensive visibility during matches, press conferences, interviews, and any media coverage. Barcelona FC’s sponsor Spotify occasionally replaces its own logo on the club’s jerseys with logos of trending music stars to give them special promotion.
- Naming rights: Placing a brand’s name on a sporting venue like a stadium or adding it to the title of a sporting tournament is one of the most effective ways to increase brand awareness among the visitors and viewers. The home of Premier League club Manchester City is currently known as Etihad Stadium as part of the sponsorship deal. Another example is the Toyota Center in Houston, Texas, home to the Houston Rockets of the US National Basketball Association (NBA).
- Digital Integration: Leveraging digital platforms for branding opportunities, such as stadium signage, LED boards, online streaming, social media campaigns, and mobile applications.
- Fan Engagement: Creating immersive experiences for fans through interactive activations, VIP access, contests, and exclusive content fosters emotional connections between the brand and its target audience.
- Cause-Related Initiatives: Collaborating with football entities to support social or environmental causes generates positive brand associations and enhances corporate social responsibility efforts.
Sponsorship in football presents a significant opportunity for brands to build brand recognition, create meaningful connections with passionate and dedicated audiences, and drive positive impact. By understanding the fundamental concepts of sponsorship, developing a strategic approach aligned with brand identity, and exploring creative formats, brands can unlock the immense potential from football sponsorship.
If you are interested to learn about the potential of sport sponsorship and how to successfully design sponsorship strategies and implement effective sponsorship campaigns, check out the program of the MAS in Sport Management and Technology or contact us for more information about Prof. Walliser’s course on Sponsorship in Sport.