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Pogba + United + adidas – The perfect marketing match?

An announcement under the hashtag #Pogback at 12.30am signalled Paul Pogba’s return to Manchester United after four years at Juventus. The boy who left England with bags of potential has come back as a man to finish what he started with his first senior club.Whilst Jose Mourinho has signed Pogba for purely footballing reasons, it’s clear the club, adidas and the player himself will all benefit commercially from this new partnership. From a marketing perspective it seems to be the perfect match.One of the biggest personalities and most exciting young players in the game has joined the biggest club in the world, which is just starting its second season with kit supplier adidas, for whom Pogba is already a key ambassador.

Signing up Pogba on a £31m 10-year deal earlier this year has helped adidas create a fresh, new look that capitalises on the Frenchman’s unique style, individualism, flamboyant nature and flashy personality. He has been the figurehead of the brand’s #FirstNeverFollows campaign, a brand position that builds on the previous #ThereWillBeHaters activation and mixes football, fashion and music. The aim of this is to appeal to the younger audience, the next wave of potential adidas consumers, and win them over from newer brands like Under Armour and New Balance, who are challenging the more established giants.

Pogba gives adidas a point of difference over its rivals, such as Nike, who were also competing for his signature. He wasn’t signed just as a face to shift trainers, but as a catalyst to help change the nature of adidas’ football marketing…to make his mark on the brand itself.

From United’s viewpoint, Pogba and adidas also help the club reach a younger audience, an audience that may be swaying towards supporting Manchester City, Real Madrid, FC Barcelona or another of Europe’s big clubs.

Pogba will be the face of both United and adidas for years to come. He hasn’t returned to Old Trafford for just one or two seasons; he will surely be there for a significant proportion of his career. He represents the new United, forging a new identity in the post Sir Alex Ferguson, era under the leadership of Mourinho.

Adidas, like other sponsors, do not get a say in the club’s transfer activity (although they may have had a quiet word in Ed Woodward’s ear), but for them shirt sales are clearly critical. Aligning one of their big ambassadors with one of their biggest clubs (alongside Real Madrid) will have been music to the ears of adidas, as the ‘POGBA 6’ United shirts start flying off racks around the world.

One of the reasons adidas teamed up with United in the first place is because the club has a huge fan base in the US and Asia, both target markets for the German sports brand. Pogba will help to gain cut-through in those markets.The French midfielder’s social channels have more than 13m followers. For United, this offers an opportunity a reach a new audience; whilst for Pogba, joining the Red Devils will no doubt see this figure grow and grow, as has happened with other recent arrivals to the club – a win-win. And adidas can utilise this massive reach to push out branded content and messaging to his adoring fans.This branded content played a role in the announcement of Pogba’s capture. Adidas teamed up with UK grime artist Stormzy to record a short piece of music-focused film featuring Pogba that matches the #FirstNeverFollows theme, announcing the player’s arrival at United. We are likely to see more dual-branded content like this appear as adidas and United push Pogba to the front of their marketing activity and his global appeal spirals skyward.

Finally, a shirt sponsor for Les Bleus?

In mid-April, on the same day that the NBA announced it would be the first of the big US sports to adopt jersey sponsorship, across the Atlantic in a Bordeaux suburb French rugby luminary Bernard Laporte launched his bid to become President of the FFR, which if he is elected could see France become the last major rugby nation to sell its national team’s shirt to a sponsor.

After the NZRU sold the previously sponsor-free All Blacks shirt to AIG for five years in 2012, Les Bleus became the only major national rugby team who choose to take the field with unbranded shirts. Laporte proposes to change that.

Laporte’s is a classic sports federation rationale: selling the shirt sponsorship will create a big new revenue stream, which he estimates at €5m-€10m per year, to help fund French grass roots rugby development. But this is much more than a commercial decision for the FFR: it will require a major philosophical pivot.

In March last year FFR head of marketing Bernard Godet told L’Equipe that the FFR had received three unsolicited shirt sponsorship offers for Les Bleus, but that the bids had been “rejected outright without studying them” because the French national team shirt is “a symbol….We remain committed to this principle and we are very proud, even if the All Blacks gave in. We are the last ones.”

When the NZRU sold AIG the All Blacks’ shirt sponsorship in 2012, France became
the last major rugby nation to choose to take the field without a shirt sponsor

And earlier this year Mr Godet told Le Monde that the FFR will not “yield to the sirens’ money” and “sell our soul…The French shirt is ultimately a kind of flag, not to be tainted with a brand of coffee, or car, or olive oil” - although he also revealed that the FFR was considering selling the sevens, women’s and youth teams’ shirts to a sponsor.

A big philosophical gap then. But unbridgeable? Maybe not. In a classic piece of realpolitik, Laporte has also proposed that the shirt sponsorship should be sold only to ‘a beautiful French flagship brand’, building a Touboniste bridge between his and the FFR’s position.

We’ll have to wait until the end of this year to find out if Laporte’s Presidential bid is successful. But if it is, with 44 manifesto measures to push through he will be a very busy man. And the shirt sponsorship idea is not one of the 44 measures in Laporte’s manifesto, so could readily be de-prioritised in the inevitable politicking of the election or its aftermath.

There’s no doubt that were it to become available there would be high demand for the French shirt sponsorship given the popularity of rugby in France, the size of the French economy, the domestic and international media visibility of the shirt, and the cachet of becoming the first shirt sponsor of Les Bleus.

However, restricting the opportunity to French brands will reduce the value of the opportunity to the FFR, by driving down demand and competition from international brands who, as the All Blacks’ deal with AIG demonstrated, would surely be interested.

So for a French-only deal the lower half of Laporte’s estimate of €5m-€10m per year is about right, benchmarked against what other major rugby countries generate for their shirt sponsorships and, as our sponsorship evaluation model Synergy Decisions demonstrates, the fact that a sponsorship has varying values to brands in different categories.

Only time will tell if Les Bleus finally break with tradition. But in the meantime, it’s worth taking a look at the commercial proposals in Laporte’s manifesto – in particular the concept of pooling the commercial rights of the FFR and the clubs. Now that would be radical.

More money, more problems?

Earlier this month, the rights to broadcast the Premier League in the UK from 2016 to 2019 were sold for a combined £5.13 billion. At over £2 billion more than the equivalent package from 2013 to 2016, this works out at £10.19 million per game over that period, or a staggering £113,000 a minute (which is still three times cheaper than Wilfried Zaha...). It now means that, when the deal starts, all Premier League clubs will receive more money for their domestic TV deals than any other club in the world, save for the two Spanish behemoths, Barcelona and Real Madrid.

Whichever way one spins it (and there are a lot of ways – including this excellent analysis from The Swiss Ramble), it represents a dizzying sum of money, but what are the implications of the new deal for the sport?

For football traditionalists, there is no shortage of concerns, including the introduction of Friday night Premier League football and the increased dominance of the Premier League over other domestic competitions (the £3.5 million prize pot for the FA Cup compares fairly unfavourably with the projected £152 million for the Premier League champions). But, perhaps most intriguingly, the announcement has caused football fans to sharpen their focus on how clubs utilise these vast sums of money.

With accusations of greed and wastefulness already commonplace, the increase in TV money will be an added stick for supporters to beat clubs with if there is no tangible change in the way that most fans feel they are treated. Rising ticket prices, poor matchday experience, difficulty of getting to matches and poor administrative club staff pay are all familiar, justified gripes from football fans that will be inevitably magnified by this influx of cash.

At the announcement of the new deal, Premier League chairman Richard Scudamore declared that the Premier League would be putting more money towards grassroots football, but also called on individual clubs to act to help fans, specifically around ticket prices. This sentiment was shared by many in the footballing fraternity, who queued up to heap pressure on Premier League clubs: Gary Lineker commented on Twitter that football was now ‘awash with money’, and called for clubs to ‘cut ticket prices and make it affordable for real fans to attend.’ Jamie Carragher continued the theme by stating that ‘ticket pricing, especially for away fans, has to change’, advocating a policy of ‘£20 for the 20 away games.’

rg 2

Although ticket pricing should be the minimum that clubs are doing to improve their relationship with fans, it will be intriguing to see their different approaches to it, and will be a fairly simple aspect to track. Will we really see wholesale changes or will we see the continuation of a general theme of token gestures from clubs (I got a £2 discount off a recent away match ticket from my supported club, which knocked the cost down to a much more manageable £53…)?

If no substantial action is taken by clubs, it is clear that fans will waste no time in airing their grievances. In a world where fans feel increasingly ostracised from the football club hierarchy, there has been a noticeable rise in high-profile protests by supporters using the level of focus on the sport as an opportunity to push their agenda. This fan action is not focussed solely around the issue of ticket pricing and club treatment of fans, but in recent times has also included high-profile protests against clubs signing particular players, club owners who do not seem fit for purpose and even the use of WiFi in stadia.

In a world where Premier League clubs’ financial power continues to rise exponentially, and where fans increasingly feel marginalised, we are progressively seeing examples of supporters effectively undertaking their own PR stunts. It is a disappointing sign of the times that the public tarnishing of clubs’ images (often by their own fans) and those of governing bodies is seen as one of few viable ways to force action.

Of course, this sort of protest from supporters can also have a negative effect on club partners; Portsmouth shirt sponsor, Jobsite were probably not delighted to be associated with the above march against club owners, who fans believed were wrongly appointed to their powerful jobs. But outpourings of fan sentiment like this can often give sponsors interesting openings. Not only does it give useful fan insights that can influence creative activations (maybe fans aren’t desperate for WiFi in stadia?) but more importantly creates opportunities for sponsors to step in and add real value for fans when they may otherwise be feeling neglected.

This can be in the form of clear, tangible demonstrations of support like increasing opportunities to get to games or cutting costs of getting them there, but also can be through adding value to the matchday experience. Also, as has been seen in high profile examples such as with Ched Evans, sponsors can use their considerable clout to reinforce fans’ views to push for action and influence clubs in a way that fans simply cannot.

It will certainly to be interesting to see if, and how, Premier League clubs look to help fans with the increased TV money. But, equally, if there is continued inaction, then the reaction from sponsors to these ‘injustices’ will be worth keeping an eye on.

Watch this space.

Should Sponsors Resist Contractual Activation Guarantees?

In modern sponsorship, success is most frequently characterised as being about win-win partnerships, where both sponsor and rights holder benefit from the shared value created - in other words, the synergies - by activation at scale. When this happens in the UK, it's usually the result of the sponsor delivering on a generally non-contractual commitment to activate.

However, at Synergy, we work on sponsorship contracts with rights holders around the world, and it's not uncommon to see contractual activation guarantees, particularly in the US. These can take several forms, including guaranteed activation spends, 'activation pots' (where the brand can choose from a menu of items provided by the rights holder) and/or  activation commitments, such as leveraging on-pack to a minimum scale or dictating mandatory markets to activate within.

There is further complexity when rights holders dictate the channels that sponsors must use as part of their media buy. This typically takes the form of minimum media spend with the official broadcast partner, as part of a wider deal between the broadcaster and the rights holder. And in the latest potential evolution, the NBA is exploring mandating jersey sponsors, as part of any deals brokered in the future, to spending guarantees with its broadcast partners Turner and ESPN. Although terms of this are still very much under consideration, it is in response to fears from the broadcasters that brands with jersey sponsorships won't need to buy as much of their media.  Of course it is not directly comparable, but imagine if Chevrolet, Emirates, Standard Chartered or Samsung were contractually obliged to buy a minimum number of commercial spots on Sky as part of their Premier League shirt sponsorship deals.

We are now beginning to see more and more of these type of clauses creep into contracts in the UK. So, what are the benefits and disadvantages to rights holder and sponsor?

It is easy to see the benefit to rights holders of being contractually guaranteed an active sponsor, who will take on the financial burden of promoting the asset, thereby increasing its visibility and value.

Contractual terms also protect rights holders at the end of longer deals, when it is not unusual for sponsors' interest in activation to wane.

It is less easy to see the wins from the sponsors' perspective. By being forced down certain paths, sponsors have less choice and flexibility on how they activate their sponsorship.

A minimum spend in itself could also be construed as counterproductive, as spend levels are not necessarily a proxy for reach or efficiency of messaging. Digital and Social in particular, can be highly targeted, with less wastage than channels such as Out of Home or TV, and are generally considered to be more cost efficient. If activated smartly, sponsorships can be leveraged on a tight budget.

Dictating a minimum spend in broadcast can also limit a brand's ability to activate creatively across other channels, with budget tied up in costly media buys. It can also be strongly argued that brands know their own audiences and how to interact with them better than anyone, so are best placed to select their media strategy.

As Tim Crow suggested recently in his blog on the IOC’s Agenda 2020, imposing geographical obligations is equally unpalatable for sponsors. The IOC is contemplating this to stimulate local activation by TOPs, and whilst National Organising Committees naturally want to see these global brands activate at scale in their territories, sponsors have their business priorities across the globe, which demand the focus of their marketing budgets.

In truth, it is a very fine line between ensuring that partners are, and remain, active and simply trusting them to activate effectively. Rights holders will argue that they are simply safeguarding themselves against being used as a media buy, with little incremental benefit to themselves. The balance needs to be found where clauses are included with contracts to ensure that this doesn’t unduly restrict sponsors' freedom of choice.