Sports sponsorship global market to reach £ 35 bn in 2019: Report
Brand spend on sports sponsorship will grow to £35 billion ($45.6 bn) globally in 2019 at a 4% growth rate, states a…
Brand spend on sports sponsorship will grow to £35 billion ($45.6 bn) globally in 2019 at a 4% growth rate, states a report by Two Circles. However, the market will still under-exploiting their sponsorship assets by £ 14 billion ($18.25 bn), the report points further
The report has valued the sports rights-holders’ sponsorship assets global market worth at £49 bn ($ 63.0 bn). Due to unsold inventory, unreported engagement and outdated asset-packaging, the market will only be able to exploit £35 bn of this market, missing out on the opportunity worth £ 14 billion.
“Most rights-holders continue to package and sell sponsorship just as they did 20 years ago – offering brand exposure through linear broadcast coverage as the main benefit for brands,” said Gareth Balch, Two Circles CEO.
“Globally we’re spending more time consuming entertainment on digital platforms; we consistently see a disparity between what brands need to reach an audience effectively and quantifiably, and what digital assets rights-holders are able to offer in their sponsorship packages,” he added.
Through its new Sponsorship Engine product, the agency’s industry-leading data platform, Two Circles found rights-holders have under-exploited their sponsorship businesses by £12bn a year on average since 2014. This is despite sports sponsorship spend growing by 4% on average during the same period, demonstrating sport’s position as a powerful gateway between brands and engaged audiences.
As more rights-holders package digital assets into sponsorship propositions – and use data-driven evaluation tools to show brands the tangible impact their content is having on audiences in real-time – Two Circles predicts spend on sponsorship will increase by 6% on average year-on-year between 2020 and 2024 to hit £48bn overall by the end of the period.
This growth comes despite concerns in Europe that marketing restrictions on gambling firms, which currently account for 12% of sports sponsorship spend in the UK alone, will have a considerable negative impact on the sports sponsorship market.
Balch added: “Rights-holders are adapting to this new world and we predict a sports sponsorship correction: by embracing the power of data and digital to create sponsorship assets that better satisfy the objectives of brands, rights-holders will realise the true value of their sponsorship businesses. This will drive greater spend from brands in all sectors, not just the ‘traditional’ sectors for sport such as financial services, automotive, airlines and gambling.”
Two Circles’ new Sponsorship Engine measures the value and impact delivered to sponsors across owned and earned rights-holder channels, providing unrivalled insight into what sponsorship assets are worth and how they should be packaged.