Several US sports leagues, including MLB and the National Hockey League (NHL), also opened up new inventory on team uniforms to help franchises rebuild their sponsorship revenue and offer further value to partners. More pertinently, though, many sports realised that they were sitting on digital and social media assets that would enable their sponsors to […]
Several US sports leagues, including MLB and the National Hockey League (NHL), also opened up new inventory on team uniforms to help franchises rebuild their sponsorship revenue and offer further value to partners.
More pertinently, though, many sports realised that they were sitting on digital and social media assets that would enable their sponsors to engage with their fans in more innovative, creative ways while events either weren’t taking place or happening behind closed doors.
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If ‘force majeure’ was the most-searched term in sponsorship contracts during Covid-19, then ‘make good’ will have been among the most used in the industry.
1. An evolution of the rights holder-sponsor relationship
Some of those sectors remain more active than others, but few have made as big a splash in sports sponsorship than the cryptocurrency category. The industry was responsible for deals cumulatively worth hundreds of millions of dollars in the years immediately after the pandemic, only for a large chunk of those to collapse when FTX slipped into bankruptcy.
Influencers might now feel like an accepted part of the sports ecosystem, but the role Covid played in thrusting them further into the limelight shouldn’t be underestimated.
Some influencers have launched their own brands which have used sports sponsorship to boost their awareness and grow credibility, while others continue to sell out huge venues for exhibition boxing bouts and soccer matches that have been watched by millions around the world.
“Some brands have maintained a strong commitment to purpose-driven initiatives, recognising the long-term brand equity they generate, while others have shifted focus back to performance-driven metrics and commercial objectives,” he continues.
According to Matt House, the chief executive of sports marketing agency SportQuake, what brands expect from their partnerships has therefore changed.
For example, Brazilian streamer Ibai Llanos launched the Fifa 20 LaLiga Santander Challenge, which was watched by more than one million viewers and won by then-Real Madrid player Marco Asensio.
Virtual competitions held in place of in-person events created some opportunities for new and existing sponsors, but months went by where only a handful of new deals were announced as brands waited for more certainty around when things would return to normal.
To that end, it’s been no surprise to see an increasing number of sports properties investing in fan data platforms or partnering with specialists who can enable them to show brands that they can reach their target audience by partnering with them.
While many brands chose to stand by their partners, perhaps wary of the optics of walking away from a sport in its hour of need, others spied an opportunity to make use of infamous ‘force majeure’ clauses, allow contracts to wind down quietly without renewing, or withhold payments if seasons were not completed.
2. Crypto headlines emerging digital-first sponsorship categories
From a marketing standpoint, brands swiftly realised that a pandemic wasn’t the time for them to be parading their products in front of consumers or making a lot of noise about their sponsorships.
By this point, event cancellations and suspensions were very much the norm, with the health crisis already putting domestic sports seasons, globe-trotting series and international tournaments on hold.
“Brands are exhibiting a heightened focus on measuring return on investment or return on objectives,” he explains. “There is an increased need to demonstrate tangible outcomes, such as increased brand awareness, purchase intent, and direct customer acquisition.
To illustrate just how much things have moved on, a recent study from Relo Metrics found that social media accounted for 54 per cent of Major League Soccer’s (MLS) sponsor media value in 2024, as well as 41 per cent for the Women’s National Basketball Association (WNBA) and 32 per cent for the National Basketball Association (NBA).
Even as sport enters a new era of marketing, House believes there’s still room for a balance.
Perhaps emboldened by the success of those one-off events, a more recent trend has seen creators help launch new sports properties such as Kings League and Baller League. With influencers at the heart of the action, quirky rules, and streaming-first distribution, they have already been able to secure sponsorships from major brands seeking to engage with their youthful audience.
Instead, this was a time for sponsors to show that they were suffering with their consumers, and several launched charitable campaigns where they could organically contribute to their communities.
“It will be interesting to see what potential impact the Trump government stance might have on this type of spending, particularly in the key US sports market and beyond.”
House points out that sponsors now want “unique marketing rights” that help them stand out and deliver against their brand objectives. Today, in a world where more content is being distributed across streaming and social platforms and some younger audiences primarily engage with sports on apps like TikTok, rights holders are carving out packages containing assets better suited to their partners’ needs.
While already an emerging trend prior to Covid-19, influencer marketing became a crucial medium through which brands could engage with their consumers during the pandemic.
In sport, the shift to online formats gave internet personalities an opportunity to further boost their profile by collaborating with professional athletes.
3. ‘Make goods’ stand the test of time as Covid accelerates shift to digital activation
Faced with significant revenue holes to plug, sports rights holders swiftly turned to new categories both during and in the immediate aftermath of the pandemic in the hope of generating additional sponsorship income.
While the health crisis created significant challenges for companies in more traditional sponsorship sectors like travel, several digital-first brands were able to prosper because of their ability to meet the changing needs of consumers now living in lockdown.
As House puts it, crypto has experienced “a rollercoaster ride from boom to bust and back again”.
That format was recreated across multiple sports as fans became increasingly familiar with streaming platforms like Twitch and the individuals regularly broadcasting to hundreds of thousands of engaged followers.
Plus, with more digital-first and high-growth technology brands investing in sports sponsorship, activations have evolved and range from online content series and branded metaverse experiences to challenges around digital collectibles and trophies generated using artificial intelligence (AI).
Half a decade later, SportsPro picks out five ways the pandemic reshaped the sector – and which trends have endured.
The pandemic, alongside the civil unrest in North America sparked by the police killing of George Floyd, meant consumers were now looking for brands to stand for something, which led to a rise in purpose-driven marketing as sponsors looked to partner with socially conscious sports which could help them tell their story.
“While traditional marketing rights and assets remain crucial, digital and social media have become more integral to sponsorship activations,” he adds. “Experiential activations, amplified by digital and social, are also enjoying a comeback, showcasing the power of hybrid engagement models – like Nike’s recent activation with the London Eye.”
The rest, as they say, is history. Fast forward to today and creators have only become more influential in sports marketing.
The Covid-19 pandemic decimated the revenues of sports rights holders unable to fulfil their contractual obligations. At the time, Two Circles predicted that global sports sponsorship rights fees would fall by US billion in 2020, a drop of 37 per cent compared to the previous year.
4. Online formats and the mainstreaming of influencers
Despite its challenges, crypto is now an established sponsorship category in sports (Image credit: Getty Images)
On this day five years ago, the Rugby Football Union (RFU), Ladies Professional Golf Association (LPGA) and the World Snooker Tour (WST) were among the sports organisations to postpone or cancel events in response to the coronavirus pandemic.
No events meant no exposure for sponsors. Sports properties were forced to think on their feet about how to deliver value to their partners. And, as time went on, it led to calls for a rethink of how the sports sponsorship and marketing industry operates.
If Covid taught sports properties anything, then, it was that they needed to be more flexible to accommodate the evolving requirements of their partners.
However, as the world moves on from the pandemic, purpose has become less of a priority for brands shifting back towards performance marketing, particularly against the backdrop of an increasingly fractured political landscape.
In August 2020, IEG reported that US billion in sponsorship value needed to be made up, equal to more than 50 per cent of rights fees paid for that year. Indeed, the pandemic forced rights holders to find other ways to compensate partners for lost exposure and engagement, including through visibility during hastily arranged esports tournaments and virtual fan events.
While that is undoubtedly positive, macroeconomic headwinds mean brands are likely being more selective about where they deploy their sponsorship and marketing budgets, meaning measurement can no longer be an afterthought for rights holders.
5. Purpose comes and goes as priorities shift
“Crypto’s intersection with financial services and digital marketing suggests it could become a scaled sponsorship category akin to online sports betting, which went from being non-existent in 2004 to one of the top five spenders in sports sponsorship by 2024,” he adds.
“However, its future growth will depend on mainstream adoption and regulatory landscapes.”
Some rights holders, like Major League Baseball (MLB), made the best of games being played behind closed doors by replacing empty seats with sponsor branding. In many cases, that was delivered through virtual advertising technology, which has achieved much wider adoption in the wake of the pandemic.
“One key shift has been the greater use of first-party data, allowing brands to drive more targeted and measurable acquisition strategies.”
FTX’s demise – and so-called ‘crypto winter’ periods marked by a downturn in currency values and trading activity – reset sport’s relationship with the category. But the industry has shown signs of recovery over the last 18 months, with SportQuake tracking 22 deals between crypto businesses and rights holders up to late February, compared to 18 in the same period last year.
Previously unheard-of online car marketplaces such as Cazoo and Cinch and food delivery services like Uber Eats, Deliveroo and Getir moved swiftly to cement their brands in the minds of sports fans. There was also a notable increase in activity from companies specialising in areas such as video conferencing, cybersecurity, health tech, cashless payments and ecommerce.
Covid accelerated the rise of already popular streamers like Ibai Llanos (pictured above, left), who is now a prominent figure in Gerard Pique’s Kings League (Image credit: Getty Images)
