Sponsorship Snacks

Week 7

As the vaccination process advances, there seems to be a light at the end of a long pandemic tunnel. From time to time, you just need some good news. If you ever feel like you need to read something positive, check out the website: Positive News. They collect and curate positive news from around the globe.

News

• Manchester City’s Etihad Stadium to be fitted with ‘supersized’ LED system
  The new LED system will allow for a better picture quality and twice the exposure compared to the older technology. That is a good example of how strategic sponsorships can be beneficial for both parties. The new system was installed by City’s new partner Unilumin. While they benefit from the additional awareness through media coverage and the display of their products, City reinforces their innovative image and can maximize their sponsoring efficiency (Source).
• Toronto is playing with the idea of an eSports arena as soon as 2025
  Veteran Snacks readers will know that eSports has long entered the mainstream market. While the municipality still has to confirm the project, the plans for the 7000 seat arena are already coming together. What makes this arena so interesting is the potential multi-use. The idea is to keep the stadium occupied throughout the week. Contrary to sports arenas, eSports does not need any specific playing field. That makes it easier to change the arena into a concert hall or an exhibition place. An own stadium will offer plenty of new sponsorship opportunities for eSports brands and partners, and it will be interesting to see if and how eSports can brand their “own” arenas (Source)
• The German Football League (DFL) is looking to raise equity.
  The DFL has invited around 30 bidders to acquire minority stakes. While the DFL is the undisputed number one in Germany, it lacks global reach. Contrary to other leagues like the Premier League, the DFL lacks prominence as a league. They are looking to catch up to the Premier League and LaLiga with the investment. Even amid a pandemic, the DFL has a strong financial position, and investors believe that a money injection could make the DFL a global product (Source)
• In rather unorthodox news, Beşiktaş JK and Icrypex have agreed to a sponsorship deal that will be paid out in 42 bitcoins (US$1.3 million).
  While this is not the first time (eToro did it in 2018), a trending curve is visible. The Scottish football club Rangers has also signed a jersey sponsorship. The pandemic urges clubs to look for different revenue streams. Cryptocurrency brands could use this opportunity to get an entry into the sports market. We could see more football clubs chartering the undiscovered territory of cryptocurrency (Source).

Food For Thought

German club Mainz 05 has been the first carbon-neutral football club in the Bundesliga since 2010. The club has shown that professional sports and ecological activism can be combined. To illustrate how a focus on sustainability helped Mainz 05, here are a few numbers for you

18% of their sponsoring revenue is directly linked to their sustainable strategy

the combined reduction in energy that they saved because of their sustainability mindset was around 33.000 €

they reduced their Co2 emissions by a combined 550 tons (Source)

Beyond those numbers, more lucrative benefits await the club. The demand for sustainable products is rising (Source), and both consumers and brands are noticing. Mainz05 has experienced increased revenues due to its sustainable merchandising. Besides, the club can access a target group, few other clubs are able to reach. As the market follows the demand of its consumers, sustainable companies have been on the rise. Mainz 05 has seen an increasing number of sponsoring requests from brands that also focus on sustainability.

From a European perspective, Mainz 05 joins other sustainablity-driven clubs such as Arsenal, Manchester City, and Juventus. All of those clubs have also recently announced sustainability strategies. However, in total only 11% percent of sports clubs have sustainability strategies, and major German clubs like Bayern Munich still have some catching up to do(Source).

The most significant upside that sustainability brings to Football clubs is the increased fan connection. Within an article about sustainability, BBC sport discovered that 74% of fans care about the impacts of their favorite Football clubs.

The biggest issue of sustainability for sports clubs is yet to be solved. The largest percentage of their Co2 footprint is the mobility of their fans. The next step is to influence fan behavior towards the use of mass transit, waste recovery, and carbon offsets. Sports has always been a catalyst for societal change, and the time has come for Football clubs to embrace it.

Case Study

Twitch has been gamer’s territory for a long time, but times appear to be changing. Let’s discuss the core principle of how to utilize Twitch.

Esports has infiltrated the mainstream market, and other sports organizations are slowly catching up on the streaming platform. As we showed in our 2021 trend analysis, Twitch is gaining traction.

The Amazon-owned service has cooperated with multiple major sports leagues such as the NBA, NFL, and English Premier League. With more than 15 million daily viewers and a daily watch time of 95 min per day, Twitch is very attractive for all sports organizations (Source).

That comes to little surprise since Twitch has already established strategic partnerships with some of the most prominent football clubs like Real Madrid, Arsenal, PSG, and Juventus (Source). Contrary to the likes of Instagram or Facebook, sports organizations are still unsure when it comes to activating the Twitch audience.

Tom Hines, Arsenal’s head of media, argued that the potential of Twitch lies in their audience. Contrary to other social platforms, Twitch users embrace longer content. Besides, the streaming platform offers many tools for interactivity (Source). What else needs to be considered?

“There’s no magic formula, there’s no process really that protects you,” admits Hines

After Arsenal landed on Twitch they tried out different things. Some of them worked, some did not. It is essential to keep testing and refining your content, especially on a new network. One learning was that they need the right host to deliver authentic content.

Twitch offers instant feedback opportunities through their live chat. Viewers can and will voice their opinion there, and it is on the clubs to collect and analyze this qualitative data. Semantic analysis might become even more important in the long run. While it can already distinguish between negative and positive words, it cannot detect sarcasm or irony.

That puts clubs in front of a tough choice: Use precious human resources to analyze the chat or automate it. The optimal solution might lie somewhere in the middle. Yet, at first, it might be more valuable to know exactly what your fans are thinking and use a human being to analyze the live chat. What might simplify the problem is the need for moderation. Teams must be cautious that they can enforce a respectful discussion that requires trained staff.

As of today, Twitch is still uncharted territory for most sports organizations. Hines states that: “I’m excited that there’s a lot of stuff on the platform I don’t understand. I can only see opportunity in it.” (Source).

The sports streaming landscape is changing, and clubs are trying to secure a pole position. Amazon is already streaming some of their Premier League games on Twitch. Yet, other streaming services such as SkySport are still trying to resist the change. Ultimately, the fan’s demand will decide the battle. Until then, the most crucial question will probably be around co-streaming. Nobody really knows if co-streaming is still covered by club rights.

For more expert insights into sponsorship data & analytics visit us on Advanced Sponsorship Insights.