10 important future trends in sports sponsorship

Sports sponsorship is considered as an ideal way to raise brand awareness. Going forward, we expect considerable change in sports sponsorships due to generational shifts, Corona and technology. We discuss 10 different trends.

Sports sponsorship has been around for ages

Due to Corona and the lack of live sports events, we have seen plenty of old footage, with (often local) billboarding the most prominent way of sports sponsorship. Since these old times a lot has happened and particularly money spend on sports sponsorship has grown tremendously.

Sports sponsorship is now seen as an ideal platform to raise brand awareness as sports is truly captivating fans all over the world. What more could you wish for? It is the reason why it has become one of the main revenue generators for athletes, teams, leagues and right holders. This is unlikely to change anytime soon. However, similar to local (billboard) advertising being a thing of the past, it is sure we will witness incredible changes going forward.

Generational shifts, technology and Corona will be the main catalysts behind change

Catalysts always play an important role in change. In the case of sports sponsorships, I believe there are three important catalysts that define the future: the arrival of new generations, the aftermath of Covid 19 and technology becoming ever more important.

A. Generations Z and Alpha becoming ever more important

As I explained in several other blogposts, Gen Z and Gen Alpha are just plain different from the generations that were born earlier. Their habits, traits and preferences will have a major impact on the direction that sports sponsorships will take place. Note that this group is growing a lot quicker than you may intuitively think. By 2030 this group will account for an astonishing 45% of the working population. Mind you, that’s just 10 years away!Let me just briefly explain the main characteristics of these new generations

• They eat, sleep and breathe tech. From the moment they were born, tech formed a major part in their lives, much more so than the generations before them. It means sports sponsorships will be impacted by this. Tech will become increasingly important in consumption habits.
• GenZ and GenAlpha are digital consumers. TV is not the way they tend to watch sports. OTT (basically streaming) and social media is how they consume it. They want to decide when, if and where.
• They want to pay only for what they consume and hate fake and non transparent ways of advertising/sponsoring. They will smell it from a mile and ban it forever.
• They are socially and environmentally engaged. Equality, sustainability and the planet are key in their perception.
• They have an incredibly short attention span of less than 8 seconds. You have to make an immediate impact to keep them interested.
• They are global citizens and will change jobs, careers and places several times in their lives.
• They like to have their own identity.
• Influencers play an important role in their lifes.
• Chilling with friends and having experiences are important to them.

Well there you have it! They are a bit different compared to many of us, aren’t they? And yes, they are the main catalyst for future changes in sports sponsorship.

Also interesting to read: How GenZ will change the world of sports and GenAlpha to create huge changes in sports

B. The rapid evolvement in technology offers huge opportunities.

Technology is changing so rapidly nowadays, it is almost impossible to keep up with it. Digital transformation and the emergence of new technologies such as Augmented Reality, Virtual Reality and Artificial Intelligence will have a huge impact on the future of sports sponsorship.

Also interesting to read: 10 great technologies that will change sports

C. Covid 19 will accelerate underlying changes in sponsorships

Live sports is the bread and butter of sports sponsorships. No live events mean that sponsors don’t get any major returns for their bucks. Marketing, fan engagement and other activities all find their base in sporting events. With sponsors getting no returns and sports partly dependent on the income stream of sponsorships, you can imagine the troubles both are experiencing.

Slowly things are starting up again, but the damage has been done and both sports and sponsors will investigate new ways to cooperate.

10 important future trends

Given the catalysts mentioned above, some trends might come forward rather sooner than later. Some of them are actually already shaping up. I believe the most important ones can be summarized as follows:

1. Ongoing trend towards digital

If one thing is crystal clear, it is the shift from traditional to digital content and it won’t stop any time soon. Both sponsors and (future) consumers are turning to digital. TV is out, digital platforms are in. Whether it is streaming or digital platforms, brands want engaging content delivered through digital channels. Whereas return on investments could not really be measured in traditional sponsorships, in the digital world this is a hell of a lot easier. With the data gathered, campaigns can quickly be adjusted to the liking of the consumer, something which was not possible in the old world.

Also interesting to read: 6 powerful trends in sports media and broadcasting

2. Datagathering will be the new gold for rights holders and their sponsors

Expect closer cooperation going forward. It’s all about data, isn’t it! Data driven digital fan engagement will be crucial going forward. Why? Both the rights holders and the sponsors want to gather as much data as possible. With these data they can measure brand engagement and hence evaluate key metrics like brand awareness, purchase intent and leads generated. Moreover, with data, they will be able to target specific customer groups both demographically and/or geographically. This way they can reach their audience in a more effective way and see how successful a campaign is.

That’s what I call a decent measure of Return on Sponsorship. Instead of billboarding to all, it will now be tailor-made to specific targeted groups. No doubt Covid 19 has and will accelerate this trend as sports organizations are frantically building digital fanbases in order to stay connected to their fans and content viewership has been on the rise. In any case sponsors and rightsholders/clubs need each other and increasingly will establish partnerships to exploit these data.

3. Global events will become more valuable as result of globalisation trend

Whether it is consumer, brand, league or club or digital platform, everything is turning global. GenZ and GenAlpha will be global rather than national citizens and they want to be able to engage 24/7 wherever in the world. Traditional leagues and clubs have to turn global in order to compensate for lower local participation and engagement rates. Digital platforms are already global. Geographic reach will be the name of the game and with reach I mean consumers!

That’s also why global events will only get more traction in the future. These events are capable to reach these audiences and connect to fans all over the world. That’s why the Discoveries, Amazons and Facebooks of this world are willing to pay big bucks for rights of global events and sponsors no doubt will pile up to jump on the bandwagon.

Also interesting to read: new formats in traditional sports: winners and losers

4. New technologies will create new sponsorship opportunities

Whether digital platforms, Artificial Intelligence, Augmented Reality or Virtual Reality, all of them offer sponsors, athletes, federations, clubs and leagues an opportunity to leverage to whatever service they offer. In the end it is all about fan engagement and all of these technologies have the opportunity to improve this.

5. E-sports and alternative trend sports will eat away sponsorship dollars from traditional sports

Traditional sports are under pressure in their home countries. Participation and stadium visits are coming down and I talk pre Corona now. One way to counter this is to start greenfield operations in countries where those sports are not active yet. It does not take away the fact that new sports are stepping forward. Alternative sports like extreme and outdoor sports are very much to the liking of GenZ and Gen Alpha, as they can express their identity with it, whilst simultaneously having fun with their friends. Red Bull has been one of the first parties recognizing this and is hugely benefitting.

But there is more! What to think of E-sports? These are taking the world by storm and are becoming ever more important. GenZ and GenAlpha have been brought up with gaming and tech and not surprisingly they embrace it as it ticks many of their boxes. Do not be surprised if E-sports will have Olympic status in 2028. In fact E-sports can be considered as a new form of entertainment. It means sports sponsorship money is pouring in, whether into leagues, players, teams or events.

Note that the investment in sponsorships in 2020 alone already amount in excess of USD 1 bln! Yes, that’s right, USD 1 bln! Covid 19 has and will accelerate this trend, as it is one of the sports which have received widespread coverage during the crisis. In the future there is more in store. With the help of VR, games might be transformed into real physical sports with players equipped with goggles playing the game physically. In any case E-sports is here to stay and sponsors will increasingly discover it as a way to reach out to the new generations.

Also interesting to read: 10 awesome reasons why E-sports will take off this decade

6. Storytelling and content marketing becoming ever more important

As mentioned earlier, the new generations have a short attention span. Good storytelling and snappy funny content that grab immediate attention will be the main tools in reaching the fan. Sponsors will use their sponsorships to create such content in cooperation with rights holders.

7. Individual athlete becoming more important to sponsors

Influencers are important to GenZ and Alpha. They rather identify themselves with individual stars than with teams. This is important for sponsors. Note that Christiano Ronaldo has the most followers on social media rather than any individual club. It means that individual athletes will be a brand’s biggest ambassadors. They are rolemodels, datacarriers and influencers all at once. Their importance will likely further increase.

Also interesting to read: the evolving modern athlete

8. Creating experiences is the name of the game for on/off-site sponsoring

No doubt some sponsors still want stadiums or sports arenas to carry their names as long as they get something in return. As explained this may be through access to valuable data but you can also think about creating experiences in-site and off-site. Think about augmented and virtual experiences in the stadium offered by the sponsor, a chatbot gathering data for the sponsor etc. It’s all about getting ownership over the fan.

This is not necessarily limited to on-site. With Virtual Reality creating stadiums in home, the sponsorship opportunities are plentiful. In any case, partnerships between clubs, sponsors and organizations will only get more important going forward.

9. Sustainability, environment, social responsibility and mission alignment are important.

GenZ and GenAlpha are into planet, health, integrity and transparency. As said, they smell fake from a mile. For sponsors, this means they should align with their mission and put their money where their mouth is. It means sponsorships of events and sports that are close to their DNA. Think of the Northface sponsoring climbing, a wind energy corporation sponsoring windsurfing etc. The brand should fit the sport or the event! Additionally sustainability and acting socially responsible will be as important. Such initiatives will do well with new generations. Think of sponsorships of women sports, green initiatives etc.

Also interesting to read: sports going green

10. Entertainment around sports way to leverage sports sponsorship.

Experiences is what is important for future generations. This leaves an important opportunity for sponsors to create these in and around games. We know how important the half time show of the Superbowl is. Just a match won’t do the trick in the future. Visiting an all-encompassing experience is what the future fan wants. A great opportunity for rights owners and sponsors!

These are just a few trends that could become more important when looking at the change in future consumers. Undoubtedly some of these trends might not materialize, whereas others will emerge. i would love to hear your opinion. Please share!