Advanced Sponsorship Insights

Will Rakuten Extend the Partnership With the FC Barcelona?

Discussing the Halo Effect in sponsorship

  1. The Holy Grail of Sponsorship Evaluation
  2. FC Barcelona — A Crumbling Giant
  3. Can Barca Replace Messi?
  4. Are Barca’s Sponsors Suffering From the Bankruptcy Scandal?
  5. Conclusion

Introduction

When comparing a football team to sport sponsorship, one finds a surprising number of similarities. Just like a team victory, sponsorship success also depends on multiple variables. Yet, there is one crucial difference. While it is quite easy to measure the success of a team, measuring sponsorship success is much harder to quantify.

The Holy Grail of Sponsorship Evaluation

Historically, sponsorship evaluation has been heavily dependent on media equivalents such as direct sales or aided and unaided awareness levels. Though, recently scholars have voiced their doubts about these evaluation techniques. They argue that sponsorship managers are missing out on indirect sponsorship effects which can be quite powerful. One of these intangible variables is the Halo effect.

FC Barcelona — A Struggling Giant

Let’s look at a real-life example of how the Halo Effect affected FC Barcelona. The Spanish club and their long-term sponsor Rakuten have recently extended their contract for one more year. After many years of continuous success, the one-year extension can be explained by the fact that Barca will (likely) lose the best player in the world. Besides, their on-pitch success has lacked its typical luster recently. Furthermore, off field factors can play a role in Rakutens decision. Barca is apparently on the verge of bankruptcy, in midst of regional political instability, and struggling to to pay thier player in full (El Mundo).

Can Barca Replace Messi?

A big part of the solution to the pressing question to renew or terminate Rakuten’s sponsorship can be answered if we take the Halo Effect into account. Messi’s GOAT (greatest of all time) aura will lead fans to perceive Rakuten as a great company. The power dynamics, in this case, are shifted towards the clubs. Since there is no consensus on measuring the positive Halo Effect, teams can drive the value of sponsorship deals to infinity.

Are Barca’s Sponsors Suffering From the Bankruptcy Scandal?

One of the biggest contemporary sports scandals has been the Tiger Woods case. Kittel and Stango (2012) estimated that due to the Tiger Woods scandal the full portfolio of sponsors lost more than 2% of market value, with losses concentrated among the core three sponsors: Electronic Arts, Nike, and PepsiCo (Gatorade). Will Barca’s bankruptcy scandal have a similar effect?

Conclusion

The ultimate aim of sport sponsorship is to connect to the internal core of a fan and play an active role in their relationship to the sponsoring brand. Only if sponsors can make indirect influences like the Halo Effect tangible, are they be able to pinpoint the true value of their sponsorships.

  • The Brand Impact each sponsorship delivers against its specific objectives (ROO).
  • Quantifying the contribution a sponsorship has on your workforce.
  • Considering the risk factors associated with the sponsorship property.