So, that’s it. London 2012 is over. Now we’re just left with misty-eyed memories, an impossible choice for SPOTY, a never-ending supply of video montages and the realisation that we’re unlikely to see anything quite like it again in our lifetimes.
It also provided a watershed moment for sponsorship in the UK. Ever since London was awarded the Games in 2005, London 2012 provided a focal point and growth engine for an entire industry. So where do we go from here?
What will London 2012 do for the perception of sponsorship in the UK
London 2012 did deliver some predictable anti-sponsorship stories. Coca-Cola, McDonalds, Cadbury, Dow, Atos Origin and BP were all given a bit of stick (for one reason or another), while numerous articles questioned the ROI of Olympic sponsorships, the relative success of ambush campaigns and various activation #fails.
But all of those issues were pushed into the background once the Games began and for that reason they will not be the enduring perspective of sponsorship in the wake of London 2012.
The narrative is already starting to crystallise around the positive stories. Sainsbury’s are out of the blocks early, claiming a 5.6% uplift in sales and a meaningful 0.3% market share gain as a result of their brilliant Paralympic sponsorship. Adidas, in fact, were able to confirm a positive ROI before the Olympics even started. You can expect the other sponsors to either follow suit or keep quiet.
No sponsor will admit to destroying value (why would they) while the positive case studies will be accentuated and decorated with plenty of awards. The overwhelming perception will be that sponsorship of London 2012 created business value and, of course, it is in everyone’s interest to support that perception.
Empirically, the sponsorship market is remaining buoyant as we continue to see a series of record-breaking new deals and contract extensions including Barclays/Premier League, Chevy/Manchester United, Samsung/Chelsea, Wonga/Newcastle, Capital One/League Cup, Investec/ECB, and O2/RFU and BMW/ RFU.
There is no doubt that London 2012 has accelerated the overall development of sponsorship in the UK – a trend which we see continuing as brands see how sponsorship can help them deliver their business, brand and marketing objectives.
What will the London 2012 Sponsors do next?
With the exception of Acer (whose category is disappearing with the convergence of consumer electronic devices), the rest of the TOP sponsors will continue on their Olympic journey. Some of these (e.g. Coke, McDonald’s, Visa, Samsung, etc.), have a strong portfolio of global sponsorship assets so probably aren’t in the market for any big new assets.
But the local sponsors, including Lloyds TSB, BA, BT, BP, Cadbury, EDF and UPS have an Olympic-sized hole in their marketing programmes.
BMW have already moved to sign an innovative new deal with the RFU to create the BMW Performance Academy, which creates a strong post-Olympic transition.
But the big question is what comes next for the others. All of these brands are in highly competitive markets with aggressive competitors who have major sponsorship assets in place. It is probably safe to assume that some of them are looking for their next big play.
Another angle to consider is whether there is a group of brands that have been keeping the powder dry for the past few years. If one of your competitors was an Olympic sponsor, it might have been a clever strategy to avoid fighting a losing battle for exposure. We might start seeing them emerge into the sponsorship market with big ambitions and healthy budgets.
All of this will create demand in the pipeline, which will fuel the competition for the best sponsorship assets.
What interesting properties are available?
I have to start this section with an enormous health warning: when developing a sponsorship strategy, identifying the right property should be the last step in the process. First, you should develop a sponsorship strategy – a clear articulation of precisely how sponsorship will help you deliver your business, brand and marketing objectives. Only then should you look to identify the assets that will best deliver that strategy.
But that’s not going to stop me giving you a quick overview of some of the key opportunities that are out there. This is not meant to be a comprehensive list – just a quick look at why this is being called the ‘Golden Decade’ for sport in the UK.
Glasgow 2014 Commonwealth Games:
Coming so soon after London 2012, there is a danger that the Commonwealth Games will feel like an anti-climax. Of course, it won’t be anything like the scale of the Olympic and Paralympic Games, but the Commonwealth Games have a unique personality which some brands have historically been able to tap into very successfully, like Imperial Leather in 2002 and NAB in 2006.
Glasgow 2014 will be nothing like Delhi 2010. First and foremost, this is because many of the biggest names and most famous athletes will be coming to Scotland. The fact that the Home Nations compete as independent teams will add some interesting storylines, while the 2014 Referendum will ensure that the “Scotland” angle provides an interesting political backdrop and a lightning rod for Scottish national pride (despite the Governing Body’s best attempt to de-politicise it).
Rugby World Cup 2015:
OK – so Rugby doesn’t have the global appeal of Football, but make no mistake, the Rugby World Cup will dominate the UK sports agenda in 2015. With a 6-week tournament taking place in all four corners of the country (plus Cardiff) and Stuart Lancaster building a team that can challenge for the title, the opportunity for sponsors is clear.
Athletics World Championships and World Paralympics Championships 2017:
This is as close as we’re going to get to a repeat of Super Saturday. With the IAAF and IPC World Championships taking place in the same city for the first time, we will be able to see first-hand the legacy left by Mo Farah, Jess Ennis, Greg Rutherford, David Weir and Jonny Peacock.
Ryder Cup 2014:
Anyone who watched the Ryder Cup last month knows that it delivers incredibly compelling sporting drama. It has an interesting narrative that opens the activation window beyond the 3-day event, while the event itself generates interest that stretches far beyond traditional golf fans.
UK Athletics and other Sports Governing Bodies:
After a 13-year partnership, Aviva has announced that it is not extending its deal with UK Athletics. UKA have announced that they are hoping to move away from a single title sponsor towards a “Champions League model”. However, I don’t think it’s a big enough asset to split into parts, with more value to one brand looking to “own the sport”.
While this isn’t public knowledge yet, the industry grapevine is abuzz with at least three other Olympic sports whose governing bodies are looking for new title sponsors. In many ways, this was entirely predictable – sponsoring an Olympic sport is a classic ambush technique. But it is a shame to see brands be so transparent and head for the hills as soon as the Olympics leaves town. Still, it provides a great opportunity for new brands to come in and create something brilliant. Do you like what Sky has done with Cycling and British Gas has done with Swimming? If so, there are plenty more opportunities like that.
Venue Naming Rights:
Venue naming rights are one of the fastest growing sectors in sponsorship. While O2 and Emirates have already done it well in the UK, looking to the US shows us what our future might look like. Over there, the Barclays Centre and MetLife Stadium are just the latest in a long line of major naming rights deals.
Over here, rights holders are actively selling naming rights for the Olympic Stadium, Aquatics Centre, “Copper Box” and VeloPark, while ExCel wants you to put “your brand here”.
Over the next decade, we could be also looking at a few new Premier League stadiums under construction. Chelsea, Liverpool, Spurs, Everton and QPR all have expressed the desire to either redevelop their existing stadia or build a new one. You can bet that most (if not all) of these will come with a naming rights sales pitch.
Arsenal Shirt Sponsorship:
AON, Standard Chartered, Samsung and DHL (for a training kit) all set the bar for the value of the kit sponsorship for a high-profile Premiership Team. Then Chevy came along and did a couple of backflips over that bar. Brands clearly still see huge value in these deals. If you are one of them, I would give Arsenal a call.
The Football League:
Npower announced recently that they would not be extending their title sponsorship of The Football League. The great thing about this asset is that it gives a brand the ability to reach deep into 72 communities around the country. It’s difficult to think of a better asset for a brand that wants to touch and be ever-present with the mass market.
England Cricket Team:
Brit Insurance cited a “shift in business strategy” for the decision to end their England shirt sponsorship, which they only signed in 2010. Their contract does not end until 2014, but this announcement clearly signals that they are looking for an early exit. If you move quickly, you can even be in place in time for the 2013 Ashes Series.
Self Created Assets:
Red Bull have been blurring the definition of sponsorship and re-writing the rules for many years. But I think that Red Bull Stratos has finally brought us to the tipping point where brands are more willing to risk blazing their own trail with self-created and other owned assets. The power of sponsorship comes from its ability to give you access to your audience’s heart and brands now see that they don’t need an established asset to take them there.
All in all, I am convinced that London 2012 will not be the high water mark for sponsorship in the UK. Rather, it will be the springboard which accelerates sponsorship to even more exciting places. The assets are there to do some interesting things and brands will become better and more ambitious in terms of how they use them. The accelerated development of the sponsorship industry will be one of the real legacies of London 2012, which is an exciting thought for all of us who are part of it.
By Carsten Thode on October 30th, 2012
Tags: Advertising, Ambush Marketing, Consultancy, Default, London 2012 sponsorship, Naming Rights, Olympic sponsorship, RBS 6 Nations, Red Bull, Ryder Cup, Sponsorship, Sponsorship consultancy, Synergy