In 2015, the UK became the first country in the world where digital took over 50% of total ad spend (emarketer), greater than the combined efforts of TV, print, outdoor and radio. However, this is not the case in sport sponsorship where digital benefits are often a footnote to a rights schedule.
Advertisers are accustomed to the benefits of digital – it is targeted, flexible, trackable and quick to activate. If sport sponsorship could mix these advantages with the natural passion a fan has for a club or league then the value of sponsorship rights could be dramatically increased.
The next five years are going to be an interesting time for sponsorship and it is essential that rights holders not only retain their digital assets but nurture these too. Without embracing and investing in technology, clubs risk becoming less relevant to their fans and losing touch with an ever changing commercial landscape.
Here are four examples of how digital rights can improve sponsorship:
Currently sport sponsorship does not lend itself to short term campaigns. It takes a long time to sell and is difficult to activate, usually involving experienced agencies at no small expense.
Take a product like a new Hollywood film; the marketing team behind the film’s release will not want to be tied into a 3-5 year period of spend which is common for sport sponsorship. Rights holders should instead offer a digital package that enables a concentrated two month campaign rather than ignoring these substantial marketing budgets.
All brands understand their customer demographic. When sponsoring a sports club or event there is often a large amount of ‘waste’. If, for example, a financial services company is looking to target consumers aged over 35, with a household income of £X and live in a specific location then this might only make up 10% of a club’s fan base.
A sports club with well-established digital rights and could take a lower rights fee and enable the financial services company to target the 10% of the fan base that they are interested in. This then frees up the remaining 90% of fans for a different company to target.
One of the fantastic things about sport is how willing fans are to interact with their favourite team or event. Vitality, a life insurance company, use sponsorship to encourage fans to calculate their “Vitality Health Age”. Whilst fans are unlikely to directly download an insurance app or visit an insurance website, if the Vitality Health Age Calculator is integrated into the England Cricket app then these fans are able to interact with an insurance company in a digital environment that they enjoy being on.
There are many companies local to a sports team who would like an affiliation with the team beyond the level a hospitality package can get them but without the marketing budgets of pan UK brands. A local car dealership for example could have a dedicated section of a club’s official app for their clients and employees. The dealership would generate value through pointing their clients to sponsored content in the app but would not need to access the wider fan base.
Currently these local sponsors take some signage around the pitch which reduces the value for bigger sponsors as well as creating a more cluttered commercial environment. A digital approach would provide these companies with the advertising they need but without affecting bigger sponsorship rights.
It is a simple fact that we are consuming ever more digital media, particularly on mobile where in the UK we spend two hours on our smartphones every day (Ofcom). As a result, digital media can and should be an integral part of every live sport event and we are starting to see a shift in sport sponsorship to cater for this demand. Clubs, events and other sports rights holders will enjoy greater revenues from these sponsorship rights in the five years.