February 2023 Newsletter

1) Navigating the Economic Uncertainty. Empirical Evidence, not ‘Turkeys Voting for Christmas’

There is inevitably ongoing concern and debate about the economic fragility around the world currently, and how best to manage businesses in such uncertain times.  Whilst some of the economic shocks that have caused this slowdown are different to anything that we’ve seen previously, there are many learnings from the past that are worth considering as business leaders plot a path through these turbulent times.

• Analysis by Ranjay Gulati et al., Bain & Co and McKinsey on recessions of the past would suggest that the difference maker is preparation.  Switching to survival mode and making deep cuts will often result in a slower recovery and losing market share.  Those that pivot and take a more positive stance to developing growth strategies will outperform their competitors through the downturn and beyond.
• By the same token, there are lessons from the past where companies that maintained brand marketing spend during a slowdown have seen significantly superior growth when the green shoots of recovery arrive, leaving competitors that have made cuts trailing in their wake. It’s the long-term effects of brand building that bears fruit.
• Brand building budgets may be considered a dispensable luxury, but when competitors are likely to cut back, recessionary conditions present a great opportunity for those businesses that can find the right balance between cutting operational fat whilst continuing to invest in the brand.

So, while some business leaders may conclude that now is the right time to reduce spend on marketing (or more specifically sport / entertainment partnerships), there will be others that will see it as a real opportunity to invest wisely.  History would suggest that a balanced but positive approach may well pay dividends in the short term and put you in a position of strength for the future.   

2) The Value Xchange: Client Update

• Rugby League World Cup 2021 finished on 19th November 2022, delivering a fantastic tournament with record crowds, TV audiences of over 30 million in the UK and the most successful commercial sponsorship programme ever. 
• We helped Activision secure Leo Messi, Neymar Jnr and Paul Pogba to appear as characters in Call of Duty. The campaign ran during the FIFA 2022 World Cup at the end of last year.
• Since our last Newsletter, we have also been appointed to work with FA Wales and the Tour of Britain Cycling Series to support them both with the commercial sponsorship programmes 

We have also began working with The Last Ride – an ambitious world’s first in global ski mountaineering and an exploratory Netflix documentary investigating catastrophic deglaciation and its effects on the broader climate emergency.

3) Trends for the year ahead 

Where would we be at the start of every year without the innumerable trend pieces.  So here’s a very short summary of what we expect to see happen in the sponsorship industry in the year ahead.

• Where better to start than the accelerated growth in women’s sport.  It’s in catch-up mode, interest levels are growing exponentially, rights owners are prioritising it and brands are demanding it.
• Consumers will continue to turn to digital platforms, while brands want engaging content delivered through digital channels.
• The ability to own and analyse data will become an ever-increasing priority for rights owners and brands to help understand, nurture and grow their audiences.
• There will be growing investment and opportunity with new technologies, particularly Augmented Reality (AR) and Virtual Reality (VR) that provide deeper engagement for fans.
• The influence of sport and entertainment talent is undoubted.  Individual talent will become increasingly important in brand activation campaigns.
• Purpose, as a sponsorship objective, is increasingly coming to the fore as consumers, brands and rights owners all strive for ways to stimulate positive change. Our next webinar will be on this very subject, watch this space for more information soon.    

4) Headlines that caught the eye

NBA’s Global Appeal
The NBA has recently surpassed 75m followers on Instagram, perhaps rather surprisingly 70% of whom are outside the US.
 
F1 Practice Makes Perfect
Max Verstappen has reportedly had his private jet renovated so that he could put a full racing simulator in his cabin.  When you’re spending around 10 days in the air per season, that sounds like a good idea.
 
Football Football Football
FIFA World Cup 2022 has clearly demonstrated the planet’s love of the sport, delivering record viewing & engagement levels, whilst the English Premier League increasingly dominates the domestic scene. Football offers brands an unparalleled platform to engage with fans, and there is a broad spectrum of opportunities for brands, not least in the EPL and EFL for next season.  Please do get in touch for more details.
 
World Cup 2026
Host cities at the FIFA World Cup 2026 in USA, Canada, Mexico and USA will be permitted to sell their own sponsorships, which will be separated from FIFA’s commercial programme.
 
A Thirst for Tech
According to the Mastercard Sport Economy Index 2023, 61 per cent of European sports fans say technology plays a major role in their enjoyment of their favourite teams, leagues and events.  43 per cent of UK fans said they watch more sport on social media than on television, and 46 per cent would like to see a sporting event featuring virtual reality (VR).
 
Sports Industry Bouncebackability
The PWC Global Sports Survey 7th Edition, completed by 500 leaders from 43 countries, predicts global growth of 6.5% in the next 3-5 years, with 83% of executives believing that institutional investment will continue to grow over the same period.     

5) Deal or no deal

Standard Chartered Bank & DP World Tour
Standard Chartered has added DP World Tour to its sponsorship portfolio, a multi-year deal that includes associate partner and official banking partner designation.  The firm will support the Green Drive sustainability initiative as part of the agreement.
 
What a Cazoo
Online car retailer Cazoo has pulled out of several sports deals across Europe including The Hundred as it looks to cut costs.

Sky Sports & International Cricket
Sky Sports has announced a new long-term broadcast partnership with the International Cricket Council (ICC) that sees the UK pay-TV network retain the rights to the sport’s major national team tournaments until 2031.  The deal, which begins next year, covers 28 international events and includes streaming coverage via Sky’s Now streaming service.
 
F1 Driver’s Eye
Formula 1 has signed a deal with RacingForce to make helmet cameras available to all on the grid this season, enabling viewers to see the perspective inside the driver’s cockpit. (see here)
 
Starry Takes Centre Stage
PepsiCo’s newly launched Starry brand has been named as the official soft drink of both the Women’s National Basketball Association (WNBA) and the National Basketball Association (NBA).  Starry is the latest in a long line of PepsiCo brands used as the focus of the partnership. PepsiCo extended its NBA partnership in 2021, signing a multi-year deal worth a reported US$300 million.
 
Byju’s Exit
Bangalore-based EdTech firm Byju’s has confirmed that it is ending its multimillion-dollar sponsorship of India’s national cricket teams early.  It is also reportedly not planning to renew deals with the ICC or soccer’s governing body FIFA.
 
Adobe Gets Creative with NWSL
Building on the success of the Bayern Munich partnership, Adobe has now agreed a partnership with the National Women’s Soccer League that will see the launch of a new programme for female content creators using Adobe’s suite of digital and marketing tools and expertise.