Why Is Sponsorship Important in Sport?
Think about this year’s Super Bowl halftime show for a minute. No, no, not because Jennifer Lopez and Shakira performed, but think of the name of the halftime show. It was called the Pepsi Super Bowl LIV Halftime Show since Pepsi sponsored the entertainment. That’s probably the biggest example of sponsorship in sports, partnering with the NFL for the halftime show. Is sponsorship in sport really important, and if so, why?
Sponsorship in sport is crucial for the following reasons:
- Sponsorship provides the funding and/or the promotion for a large event to reach its max potential
- Athletes and sports promoters can focus more on gearing up for the big game than tracking down donations
- Big-name sponsorship can create attention for an event or game
- The increased attendance/viewership through a sponsorship partner can boost merch sales and other revenue for the sport
In this article, I’ll elaborate more on the above 4 reasons that highlight the importance of sponsorship in sport. I’ll even cover some more big sports sponsorship agreements akin to this year’s Super Bowl Halftime show and the benefits these partnerships created. You’re not going to want to miss it!
4 Great Reasons Why Sponsorship in Sports Matters
Sponsorship Allows the Sports Organization to Host Its Dream Event
Let’s say you’re part of a sporting organization and you want to host the finals of your annual soccer tournament in front of a live audience. You have your regular attendees you can fall back on as well as an influx of leads you’re working on.
You want this event to be bigger though, like really big. It’s the fifth year of your soccer tournament, after all, and the players that have worked so hard to get to this point should be able to showcase their skills on a grand stage.
Is that grand stage a 5,000-person soccer arena? More than likely something like that, right? Yet such an arena is also way outside of your budget. Using a spare high school soccer field doesn’t seem apropos for the gravity of your event, but what other choice do you have?
Well, you could seek sponsorship. A sponsor with deep pockets or even two or three smaller but financially well-off sponsors could provide the level of funding you need to secure that 5,000-person soccer arena for your sports tournament.
If you’re worried about filling the seats, you shouldn’t be. As I’ll discuss in the coming sections, once you have a quality sponsor on your side, the benefits begin snowballing from there.
Athletes and Sports Promoters Can Focus More on Training and Preparing Than Sponsorship
The duty of a sports promoter is to choose venues, secure the budget, and generate attendance, so it would be them who would seek the sponsorship for your organization. However, a sports promoter’s responsibilities include more than just those duties. They’re also in charge of logistics, marketing, and all the business aspects of successfully planning and hosting a sporting event.
If your sports promoter spends all their time obtaining donations for the event, then they’ll have little time to plan the other facets. This can lead to a less than stellar game that few people will want to attend again.
Once you pursue sports sponsorship, that’s one big item on the to-do list you can quickly check off. As I mentioned in my post about athletic sponsorship, this majorly alleviates stress.
It’s the same thing for athletes. As the performers in the game, they have to spend the days leading up to the event training hard. In NASCAR and other motorsports, it’s sometimes on the athlete themselves to find sponsorship, which can be tough. This outside venture takes away from their training time, which could lead to an underwhelming performance.
If you’re in the motorsports field and you’re looking for a sponsor, then you won’t want to miss my recent post on motorsport sponsorship.
Huge Sponsor Partners Can Bring in a Bigger Audience
The Pepsi Super Bowl LIV Halftime Show sounds so much better than the Pibb Xtra Super Bowl LIV Halftime Show, doesn’t it? That’s not a knock on Pibb Xtra, but this brand pales in comparison to Pepsi.
With the Pepsi Halftime show, people feel inclined to tune in because hey, they know Pepsi and that’s a ginormous brand. A Pibb Xtra Halftime show could be anything. It might be a better time to grab a snack or take a bathroom break than sit down and watch.
Your first sports sponsor might not be on the level of Pepsi, but you do want to aim for at least one well-known sponsor if you can. That name recognition could attract attendees to your event or TV viewers who might not have otherwise bothered.
Now, you’re probably wondering, how do you get sponsorship from a high-level company? To answer that question, I implore you to think about a sponsor company’s own objectives and goals when they decide who they want to support.
Some sponsors are interested in extending their reach and branching out into new territory, such as sports sponsorship. Others want the media exposure that can come with a big event like your soccer tournament.
Sponsors may also be interested in building their own brand awareness or generating more leads from your audience.
Once you know what it is your sponsor wants or needs, it’s a lot easier to craft your sponsorship strategy. You can also check out my post about event sponsorship to gain some pointers that will help you get started.
Higher Attendance at Sporting Events Means More Revenue
The last reason sponsorship matters so much in sport is the almighty dollar. Your sponsor, in backing you financially or promotionally, wants your event to be a smashing success. They’ll get plenty of good publicity, and that large audience turnout gives them a larger pool in which to cull leads.
On your end, your revenue could surpass your forecasted expectations. The more people who attend your event, the better your ticket sales are, unless by chance it was a free event. Even still, there’s lots of ways to make money at a sporting event, such as by selling food and drinks, t-shirts, and other commemorative merch.
According to a 2017 report from CNBC, in that year, United States citizens spent $56 billion on sporting events, including the purchase of food and drinks, transportation, and tickets. That’s not too shabby.
Also, this report cites research from a firm called Transparency Market Research that mentions how, by 2024, the licensed sports merchandise market will earn $48.17 billion.
There’s certainly money to be made through your sporting event, which you can use to fund future events or on marketing efforts to grow your audience even further.
The Biggest Sponsorships in Sports
In this section, I thought I’d share the most significant sporting sponsorship deals at current as well as how both the sports organization and the sponsor benefit. This will show you how the synchronous relationship between a sponsor and their partner is supposed to work. You’ll feel more amped up than ever to chase your sport sponsorship!
Samsung and the International Olympic Committee, Others
Samsung, which is based in South Korea, of course wanted to be a part of the 1988 Summer Olympics in Seoul. That participation landed them a long-standing seat on the International Olympic Committee. Other members of the Olympic Partner program are General Electric, Coca-Cola, Panasonic, Toyota, Visa, Intel, and Airbnb, so some pretty heavy hitters overall.
Besides its work with the Olympics, Samsung has also sponsored PGA Championship games, La Liga (a Spanish football division), NASCAR, and MLB. Most importantly though is its Samsung Sports division, which includes eSports, volleyball, and soccer teams.
These leagues, such as the Daejeon Samsung Fire Bluefangs in volleyball, the Seoul Samsung Thunders in basketball, the Samsung Lions in baseball, and the Suwon Samsung Bluewings in football never have to worry about sponsorship with the backing of Samsung. Plus, given that Samsung is in the name of every team, it’s instant promotion for them.
The Samsung Sports division even has teams in taekwondo, (the Samsung S-1 Taekwondo Club), wrestling (the Samsung Life Wrestling Club), table tennis (the Samsung Life Table Tennis Club), badminton (the Samsung Electro-Mechanics Badminton Club), and equestrian activities (the Samsung Electronics Equestrian Club). They’re pretty far-reaching!
Coca-Cola and the World Cup, Olympic Games, Others
Is there a bigger name than Coca-Cola? Maybe Nike, Amazon, or Apple, but few other brands can ever compare to the soda giant. It’s no wonder then that Coke has had its figurative hands in all sorts of sporting organizations and events, among them World Cups (for rugby, cricket, and soccer) and the 2021 Tokyo Olympics.
Coca-Cola has sponsored the FIFA World Cup since 1978, which is incredible. How did such a long relationship come to be? Well, Coke has always liked soccer, especially the FIFA World Cup. As far back as 1950, they’ve advertised at the soccer event’s stadiums. Building on common interests is certainly one way to create a seamless professional relationship.
Red Bull and Formula One Racing
Another relationship in which the sponsor has explicit interest in the sport is Red Bull with Formula One racing. So strong is the interest that Red Bull wasn’t content merely being a sponsor, but they wanted to get in on the action too. That’s how the Red Bull Racing Team was born.
This is just like the Samsung Sports division, in that those drivers lucky enough to get on the Red Bull Racing Team never have to worry about sponsorship dollars or promotions. Fortunately, Red Bull has branched out to other sports as well, including eSports, soccer, and hockey.
As decades-long relationships like those between Coca-Cola and the FIFA World Cup or Red Bull and Formula One tell us, sponsorship will always have a place in sport. Even if you’re not pursuing such behemoth sponsors, through sponsorship, you can expand your event, focus on training and readying the event, and bring in a bigger audience. Said audience will also spend more money between ticket sales, food and drink, and merch.
Now you’re ready to pursue your first sport sponsors. Good luck!
ABOUT THE AUTHOR
Chris Baylis is the President and CEO of The Sponsorship Collective and a self-confessed sponsorship geek.
After several years as a sponsor (that’s right, the one investing the money!) Chris decided to cross over to the sponsorship sales side where he has personally closed tens of millions of dollars in sponsorship deals. Chris has been on the front lines of multi-million dollar sponsorship agreements and has built and coached teams to do the same.
Chris now spends his time working with clients to value their assets and build strategies that drive sales. An accomplished speaker and international consultant, Chris has helped his clients raise millions in sponsorship dollars.