Brands move beyond sponsorships and advertising by developing—and owning—new sports, championships, and leagues. The Red Bull approach to brand-backed sports becomes the rule rather than the exception. It’s not just your brand’s name on the stadium—the sport itself embodies your brand.
Large, hard-to-quantify sports sponsorships become a thing of the past as brands redirect their marketing budgets to personalized, micro-targeted digital ad campaigns with an audience of one and an instantly verifiable return on investment. It’s not about the most eyeballs but the right ones.
Big Data: analytics, targeting and personalization
Explosion of new content-production options (GoPro, YouTube, Instagram, Periscope, etc.) giving brands new sports-related avenues to reach consumers, and consumers new, non-sponsored channels of their own
During Commercials, Fans Are Texting Their Friends
Multitasking consumers are not ignoring the ads — counterintuitively, they actually have better recall of the ads they view than those who are only viewing the event, according to Paul Verna, eMarketer Senior Analyst.
Who Owns the Ball Makes the Rules
The more the landscape fragments, the greater the natural urge for a shared communal experience. Major sports will always retain their ability to bring people together.
Loss of Control
Controversy is no longer taboo. Certain kinds of controversy are actually healthy and sustain the conversation that engages fans — such as a controversial call by an umpire, or a quarterback controversy, or the debate over a player trade. These kinds of controversies don’t drive fans away, they suck fans in.
In 20 to 30 years, everyone will look like Red Bull. Red Bull is now the event. ESPN started this with X-Games, and it’s the way things are going to go. All major leagues and sports will have proprietary networks. For each one, you’re going to log in to watch what you want to watch and buy it directly from the supplier. Embedded in that are the sponsorships and product mentions and everything else that a sports property needs to monetize the event.
Dr. David K. Stotlar
Professor, School of Sport and Exercise Science, University of Northern Colorado
|Media Type||Definition||Examples||The Role||Threats||Benefits|
(the old way)
||Brand pays to leverage connection with league or franchises||
(for those with the resources)
|Brand controls the content and the channel||
||Create direct relationship between franchise or league and fans||
(the Holy Grail)
|Word-of-mouth: when consumers become the channel||
||Allows fans to share information and reactions that are meaningful to them||
Alongside the 2 billion smartphones already in operation, 3 billion more new smartphone users will come online in developing countries in the next five years alone. Brand sponsors have an enormous opportunity to rush into developing markets such as Brazil, Russia, India, China, and the Middle East.
One of the biggest challenges for marketers is fragmentation — not just in terms of the proliferation of brands, but also in terms of consumer interests. Twenty years ago, you could advertise on the networks; sponsor the four big sports; get involved with a few big-name concert tours and rest assured that your brand message was being delivered. Now, you have dozens of cable channels with programming that draws passionate followers, let alone original programming that lives only on online; emerging sports and local sports opportunities; a music landscape that is much more diverse; the impact of social media; and new trends and passions emerging every day.
Former Chief Marketing Officer of Millercoors
Sports has never had it better; it’s the one thing on television that hasn’t been disrupted by DVR technology. People still watch sports live, so they don’t skip through the commercials. This simple truth has drastically driven up the value of sports programming. In an increasingly fragmented media environment, sports are the one thing that still grabs the attention of a widespread audience.
The Conversion from The Planned to The Improvised
Fans so crave authenticity that staged interactions are seen as stiff, and fail to get traction. The sponsorship game is going to have to be played like sports themselves — improvised instantaneously rather than packaged and planned. The winners in the viral social media space — where consumers become broadcasters — are those who will be able to respond quickly to new events and make the most of what are, essentially, broken plays.
Example: A tornado leveled large parts of an Oklahoma City suburb. Farmers Insurance tapped golfer Rickie Fowler to use social media to reach out to people in his home state. Farmers identified a boy who saved his dogs from the storm but lost his golf clubs; Fowler met with the boy and give him a new set of clubs. Farmers tied that back to an appearance by the company’s CEO in the area signing claims. “We used the celebrity of Rickie — bridging to what it is we do,” said Chuck Browning, head of sponsorships, events, and corporate giving for Farmers.
The Rise of Athlete & Team Crowdfunding
Never has it been easier for the local school team to raise the funds online to get to that tournament across the country. But this phenomenon is much larger, and it’s going to potentially crowd out traditional sponsors along two vectors:
Subsidization of costs
The US Ski & Snowboarding Association’s RallyMe site currently helps skiers get to the world championships with a network of individual donors who contribute to individual athletes’ training budgets. The athletes send their patrons personal thank-yous via email or social media. Look for more online one-to-one sports sponsorship marketplaces to emerge.
Participation in future revenue
Star athletes can take on investors. Fantex sells real securities linked to the earnings generated by a pro athlete’s brand. Athletes get money up front in exchange for a share of future income; San Francisco 49ers tight end Vernon Davis raised $4 million. The potential is there to create a futures market for young amateur athletes, to remove obstacles that keep them from maximizing their athletic potential.
Predicting the Future
Overcrowding & Fragmentation
Brands’ messages get lost in a blizzard of marketing. Logos on the outfield fence or the hood of a stock car become indistinguishable due to overcrowding. As advertising grows more ubiquitous, the traditional “corporate graffiti” becomes increasingly invisible. Fans’ attention is divided among a myriad of screens and entertainment options.
Athletes continue to fight their teams and their leagues over who “their” sponsor is. (See: Russell Wilson & Beats audio vs. the NFL.) Scuffles over exposure become common. Fans easily see through inauthentic sponsor deals. To cope with these challenges, brands seek to become part of the event itself, owning their original athletic endeavors — especially in the exploding new markets like the Middle East. On and off the field, the line between sport and sponsor is blurring. Brands want to give fans experiences they can’t buy, or ignore — such as United Airlines giving its most frequent fliers batting practice at Yankee Stadium.
Personalization & Nation Building
The era of the “official” and “exclusive” sponsor ends. Tapping proprietary datasets about their fans, corporations focus on personalizing the perfect marketing/content mix for millions of “audiences of one” over tailored on-demand mobile device streams.
The big spenders on sports sponsorships are no longer just the corporations. They’re emerging nations. Following the early lead of Qatar and Azerbaijan, developing nations realize sports sponsorship is the way to stand out in their region and to be seen as modern, egalitarian, and tourist-friendly. Their real goal here is gaining the stature to join intercontinental trade zones like the European Union, which opens up tourism, reduces interest rates they pay on government debt, and attracts further capital for modern infrastructure. Sports sponsorship becomes an important nation-building tool.
All the middlemen begin to disappear, replaced by frictionless technology (descended from Google AdWords) that reaches sports fans more effectively for less. Everyone between the fans and the athletes is in jeopardy. This list of vulnerable targets includes advertising agencies, broadcasters, journalists, and even leagues themselves. Every smartphone is a broadcast-grade camera; every athlete has her own syndicate of sponsors. Feeling held back by shared revenue agreements, superbrand teams with global audiences ditch their leagues to barnstorm against international competition.