The Warc Blog

The Warc Blog

Getting sports marketing right
Joseph Clift, Product Manager, Warc
Joseph Clift

Sports marketing is big business. According to PricewaterhouseCoopers, total global sports revenues will rise from $114bn in 2009 to $133bn in 2013. And sports sponsorship - from high-profile shirt deals to corporate tie-ups within match broadcasts - is set to be the fastest-growing segment within this total.

So it's no surprise that putting together an effective sport sponsorship strategy has become a big priority for many clients. At an IAA event held in London, Javier Diez-Aguirre, director of corporate communications at Ricoh EMEA, gave details of how the Japanese electronics firm had consolidated a piecemeal, "ad hoc" network of small deals with various sports in various markets to a single focus on a sport likely to appeal to its target audience of business executives: tennis.

Javier Diez-Aguirre on Ricoh's sponsorship strategy (1:37)

It seems Ricoh is confident it's getting it right. But according to other presenters at the IAA event, there are many potential pitfalls for companies attempting to strike partnerships in the sporting world.

In his presentation, Sean Jefferson, leader of media agency network Mindshare's global sport and entertainment division, pointed out that setpiece sporting events risk being outmanoeuvred by rivals in the battle for viewers. Mindshare's figures suggest 11m UK adults watched Barcelona's thrilling demolition of Manchester United in the UEFA Champions League final last month - but that a still-more-impressive 13.5m tuned in to watch Simon Cowell's return to Britain's Got Talent a few days later. This trend - televised talent contests outscoring sporting events - is also being replicated across Europe.

Jefferson suggested the X Factor and Got Talent franchises in particular are pulling ahead by adopting much more sophisticated marketing strategies. X Factor, for example, generates five times the number of tweets as the Champions League. "The lesson that can be learned is the way entertainment brands fully leverage the long tail," Jefferson said. "They reach out and engage with their audience online and on mobile."

And the Champions League final - the biggest game in European club football - also has a way to go before it gets as important for advertisers as the Super Bowl in the US.

Sean Jefferson talks about the Champions League (1:22)

So there's work to do for sporting brands in the new digital world. While sports are still attracting big audiences - and hefty sponsorship support - that could change if the promoters of these events remain wedded to traditional media. With this in mind, the IAA's Fredrik Borestrom, also a director at Eurosport, discussed the broadcaster's efforts to use mobile and online as part of sponsorship deals with clients.

Fredrik Borestrom talks about Eurosport's digital plans (1:20)

Also speaking at the event, Julie Clark, head of sport and leisure at PwC, highlighted another challenge to the sporting world: the impact of the global economic slowdown on both consumer and business spending. Tough economic times means some fans are less likely to pay out for season tickets, while some businesses, especially those in mature markets, are reducing their marketing spend on sporting events. "The economy impacts on sports spend, largely because sports spend is related to disposable income," Clark said.

Happily, it's a different picture in developing markets. Asia Pacific already accounts for 25% of global sponsorship revenues, compared to a 15% share of the global sports market, suggesting that many fans in the region prefer to follow European football and US basketball rather than spending money on tickets to see local teams. Companies in the BRICs – Brazil, Russia, India and China – are also flexing their muscles in the sponsorship arena, and accounted for 12 of the biggest 50 sports sponsorship deals in 2010, a total Clark suggested will rise sharply in the years to come.

Warc has prepared a full report on the IAA event for subscribers, including extra stats and charts, which is available here. You can look up future IAA events on their website or via our event listings.

Subjects: Marketing, Advertising

14 June 2011 14:46

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