How does the Corona Virus impact sport sponsorship?
Sport Sponsorship faces a drastic change. Cancelling sporting events and tournaments lead to a digital revolution in this sector. Experts predict that spectator experiences and feelings of an event will never be the same anymore. Sporting events and sport associations have to adapt to new trends and technologies. The digital assets of an athlete, team or sport club will become more valuable to sponsors in this unpredictable time.
In the past sponsorship deals focused on exposure during sport events. It is an effective tool to connect emotional and impressive memories with your brand. Now, no sport events equal no beneficial value for sponsors from live events which are basic exposure options of sport properties, whether that’s on an amateur or professional level. Therefore sponsors do not have the basic premises to launch their marketing, fan engagement, and all other activities associated with the rights and assets they’ve acquired. Thus many companies cancel or reconsider their sponsorship deals, but some negotiations start again.
How do the sponsorship industry and stakeholders move forward?
Early reports suggest that there are big challenges for both the bigger and the smaller players in the industry, following the postponement of the Tokyo 2020 Olympics a figure of 2,5 billion Euros has been quoted as the cost of pushing back a year. Not to mention the impact on all other sports events that were already due to take place in 2021.
Even though on-site events and marketing are not effective tools anymore, sports sponsorship is adapting and transforming itself to act online. Even with a 37% decrease this year, the market is still worth over 28 Billion Dollars. Only 2,9% of all the money is invested in Social Media marketing which is very little, keeping in mind companies spend more than 50% of their marketing budget in digital advertising according to Sam Yardley from Two Circles (2020).
The consumption of media on mobile devices has increased since the beginning of Corona. The average person spends about 5h and 45min a day on their phone. Therefore, it will be unavoidable to combine sport sponsoring with a mobile digital experience.
Sport entities become more and more innovative using the digital space. Whilst some sell empty seats as real estate for advertisement, the NBA is taking streaming to the next level. They are the best example of a league already prepared for the shift to digitalization. In collaboration with Microsoft, they enable their fans an exclusive experience through a “Together-Mode”. Big LED-Screens surround the field and around 300 fans can observe each other watching the game, creating the impression and excitement of a real game happening in your living room. And one or another fan will be happy to see, they are “sitting” next to a celebrity. Even for the players, this development has an influence on their performance, as they see and feel the emotional support and reactions of their fans.
Bringing the intense emotions of a live sports event to followers through digital platforms will be a massive undertaking, but sport entities have to reinvent themselves digitally to be attractive to followers. Sponsors and sport clubs can and should work together, as the NBA and Microsoft do, to make this change happen. It is a great opportunity for sponsors to align their favourite sponsoree with their marketing strategy and achieve increased brand recognition once the new digital product of the sport entity is released.
Of course not every sport club, league or athlete has the same resources. Therefore, be creative! E-Sports can be used as inspiration to implement new strategies and give the sport property a long term added digital value to brands.
Imagine having an international fanbase…. How could you or your sponsoree give them the same experience digitally, when none of the fans could come to your events?