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Sports Marketing and Sponsorship - UK - June 2011

There are various ways of defining the concept of sponsorship. One useful version, put forward by S Sleight in the 1989 publication Sponsorship – What It Is And How To Use It, reads as follows, and is used by Mintel as a guide throughout this report:

"Sponsorship is a business relationship between a provider of funds, resources or services and an individual, event or organisation, which offers in return rights and association that may be used for commercial advantage."

Within this framework for the sector, Mintel’s analysis and value statements are confined to:

  • events taking place in the UK
  • international events, part(s) of which take place in the UK
  • representative organisations and governing bodies based in the UK.

Sponsorship of individual athletes is not included in value assessment but is included in discussion.

The cyclical nature of the sports sponsorship market and the high proportion of deals whose value goes unreported mean there is no reliable measure of brand expenditure in this market at present. Values included in this report refer to new deals only, but give some indication of trends in the market in terms of both the number of deals being done, and the value of these.

Most of the small-scale sponsorship deals that exist are not included in the market size. That is, local or regional projects or events, local sports leagues and anything else that is not reported in the national media and is, therefore, not quantifiable.

Sponsorship versus donations

One of the key difficulties that exist in assessing the size of the sponsorship market lies in drawing a distinction between sponsorship and donations.

In general, sponsorship and donations have very different objectives for companies, with the former originating from their marketing departments and the latter from a donations committee or something similar. However, where large sums or complex funding arrangements are involved, or where a corporation’s leading executive – most probably a founding entrepreneur – is likely to make personal decisions on both sponsorships and charitable contributions, sponsorship and donations are often combined in a single package.

A third type of involvement complicates the picture further, in the form of corporate patronage, a half-way house between donations and sponsorship that generally provides only some recognition of a company’s activity among a relatively small, though influential, group. Although this is more common in the arts than sport, it is pertinent to mention because of the instances where it does occur.

The difference between sponsorships and donations is often obscured. However, the main distinction between them is based on four factors:

Source of funds – Sponsorship is typically funded by marketing, advertising or communications budgets, while donations come from charitable donations or philanthropy budgets.

Cost of funds – Sponsorship is written off as a full business expense in the same way as media placement costs, for example, while the ability to write off donations is limited to 75% of net income.

Aims of the funding – The main goal of sponsorship is to help a company sell more products/services or to increase positive awareness of the company among its consumers and possibly government. Donations, in contrast, are designed to show a company is a good corporate citizen and to improve the company’s image with its closest stakeholders (eg employees, shareholders, suppliers).

Where the funding goes – Sponsorship is usually directed to events, teams, arts or cultural organisations, projects or programmes. A cause is sometimes associated with the undertaking, although this tends to be a secondary element. Donations, in contrast, are typically primarily cause-related (education, health, diseases, disasters, environmental), but can also be culture-, arts- or sports-related.

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Table of contents

  1. Introduction

      • Definition
        • Sponsorship versus donations
          • Abbreviations
          • Executive Summary

              • The market
                • Figure 1: Volume and value of reported new UK sponsorship deals, 2009-10
              • Olympic effect softens blows of recession
                • Football still the only game in town
                  • Trade perspectives
                    • Figure 2: Trends in sports marketing expenditure, 2011
                  • Still plenty of reasons to make room for sports marketing
                    • Restrictions on resources slow sophistication of sponsorship
                      • Sponsors turn down titles to pair up with performers and partners
                        • Figure 3: Most popular sports marketing activities, May 2011
                      • The consumer
                        • Figure 4: Trends in agreement with statements on sponsorship, 2006-10
                      • Exposure v engagement – spectator v participation sport
                        • Can Olympic sponsors become national champions?
                          • What we think
                          • Issues in the Market

                              • How is sport retaining its appeal in a fragmented marketing landscape?
                                • London’s Olympic Games – opportunity or threat?
                                  • How has sports marketing responded to the recession?
                                    • How are sponsors and properties exploiting new technologies?
                                      • Is activation now nine tenths of the sports marketing law?
                                        • How are brands evaluating the performance of their sports marketing activities?
                                        • Future Opportunities

                                            • Trend: Edutainment
                                              • Trend: Attention Economy
                                              • Internal Market Environment

                                                • Key points
                                                  • Sport – a national interest
                                                    • Figure 5: Interest in sports, 2006-10
                                                  • Playing vs watching – two different ball games
                                                    • Figure 6: Most popular spectator, participation and television sports, 2010
                                                  • Televised sport – could more be less for sponsors?
                                                    • Figure 7: Sports coverage on television, by channel, 2006-10
                                                  • Major events = major opportunities
                                                    • Figure 8: International events being staged in the UK, 2011-2015
                                                  • The 2012 Olympic Games – an invitational event
                                                    • Figure 9: Trends in agreement with statements on the Olympics, 2006-10
                                                  • New stadia open up new name game
                                                    • Figure 10: New stadiums planned/being built across the UK
                                                  • Will government stay on the sidelines?
                                                  • Broader Market Environment

                                                    • Key points
                                                      • Advertising market beats wider economy in emerging from recession
                                                        • Watching sport set to defy the ageing process
                                                          • Figure 11: Trends in the age structure of the UK population, 2005-15
                                                        • Broadband’s depth more attractive than breadth
                                                          • Figure 12: Broadband penetration, by demographics, 2004-10
                                                        • Smartphones create new route to inspire and engage
                                                          • Figure 13: Smartphone penetration and mobile internet access, Q1/2008-Q2/2010
                                                        • Sponsors look beyond bums on sofas
                                                          • Figure 14: UK multichannel TV penetration, by platform, 2005-10
                                                      • Competitive Context

                                                        • Key points
                                                          • Sport to stretch its sponsorship lead
                                                            • Figure 15: UK sponsorship market, by share, 2000-08
                                                          • Sport sponsorship punches above its advertising weight
                                                            • Figure 16: Main media advertising expenditure, 2006-10
                                                        • Strengths and Weaknesses in the Market

                                                            • Strengths
                                                              • Engagement
                                                                • Exposure
                                                                  • Proximity
                                                                    • The Olympic effect
                                                                      • Potential of technology
                                                                        • Weaknesses
                                                                          • Impact of the recession
                                                                            • Image
                                                                              • Evolution of objectives
                                                                                • The Olympic effect
                                                                                  • Availability
                                                                                  • Who’s Innovating?

                                                                                    • Key points
                                                                                      • Smart shoppers get in through the back door
                                                                                        • Slicing through the clutter?
                                                                                          • A bigger wardrobe to cover the cracks
                                                                                            • Sponsors seek centre (court) stage
                                                                                            • Market Size and Forecast

                                                                                              • Key points
                                                                                                • After the crash: Volumes recover faster than values
                                                                                                  • Figure 17: Volume and value of reported new UK sponsorship deals, 2009-11*
                                                                                                • The future: Creativity the key to demonstrating value
                                                                                                • Segment Performance

                                                                                                  • Key points
                                                                                                    • Popularity and inventory driving saleability
                                                                                                      • Figure 18: Most-sponsored sports, by volume of new deals, 2009-11*
                                                                                                    • Major events boost minor sports
                                                                                                      • Football still the most valuable game in town
                                                                                                        • Figure 19: Most-sponsored sports, by value of new deals, 2009-11*
                                                                                                      • Location and timing influence pricing
                                                                                                      • Market Share

                                                                                                        • Key points
                                                                                                          • Big four dominate the top of the league table
                                                                                                            • Figure 20: Leading sponsor industries, by volume of new deals, 2009-11*
                                                                                                          • Brand builders still flock to football
                                                                                                            • Figure 21: Leading club sponsor industries, by competition, 2010-11 season
                                                                                                          • Sport takes a hit in the banking crash
                                                                                                            • Figure 22: Leading sponsor industries, by value of new deals, 2009-11*
                                                                                                          • Olympic sponsorships: Tiers within tiers
                                                                                                            • Figure 23: London 2012 Olympic Games Tier 1 sponsors
                                                                                                            • Figure 24: London 2012 Olympic Games Tier 2 sponsors
                                                                                                            • Figure 25: London 2012 Olympic Games Tier 3 sponsors
                                                                                                        • Consumer Awareness

                                                                                                          • Key points
                                                                                                            • Reach delivers awareness, but niche delivers approval
                                                                                                              • Figure 26: Trends in agreement with statements on sponsorship, 2006-10
                                                                                                            • Olympic brands have head-start as 2012 approaches
                                                                                                              • Think outside the box to stop TV closing proximity gap
                                                                                                              • Trade Perspectives: Sponsors and Sports

                                                                                                                • Key points
                                                                                                                  • Figure 27: Mintel sports marketing and sponsorship survey participants, by category, May 2011
                                                                                                                  • Figure 28: Mintel sports marketing and sponsorship survey participants, by sports sponsored, May 2011
                                                                                                              • Trade Perspectives: Sports Marketing Budgets

                                                                                                                • Key points
                                                                                                                  • Sports brands and the lower profile go all-in
                                                                                                                    • Figure 29: Sports marketing spend as proportion of overall company marketing budget, May 2011
                                                                                                                  • Spending increases target quality over quantity
                                                                                                                    • Figure 30: Sports marketing spending trends, May 2011
                                                                                                                • Trade Perspectives: Decision-making

                                                                                                                  • Key points
                                                                                                                    • Sport is still a results business
                                                                                                                      • Figure 31: Most common influences on sports marketing spending decisions, May 2011
                                                                                                                    • Contrasting views of the economy
                                                                                                                      • Sponsors watching the bigger picture
                                                                                                                      • Trade Perspectives: Sports Marketing Activities

                                                                                                                        • Key points
                                                                                                                          • Few contenders for the title
                                                                                                                            • Figure 32: Most popular sports marketing activities, May 2011
                                                                                                                          • Athlete endorsement powerful as passion play
                                                                                                                            • Go to the top to reach the bottom
                                                                                                                            • Trade Perspectives: Marketing Motivations

                                                                                                                              • Key points
                                                                                                                                • Awareness and exposure can no longer stand alone
                                                                                                                                  • Figure 33: Most common motives for involvement in sports marketing, May 2011
                                                                                                                                • Proximity to passion gives sport its appeal
                                                                                                                                • Trade Perspectives: Discovering Opportunities

                                                                                                                                  • Key points
                                                                                                                                    • Preferred agents side with sponsors
                                                                                                                                      • Figure 34: Sources of information about sports sponsorship opportunities, May 2011
                                                                                                                                    • More sponsors doing it for themselves...
                                                                                                                                      • ... and properties take to the road
                                                                                                                                      • Trade Perspectives: The Sports Marketing Cycle

                                                                                                                                        • Key points
                                                                                                                                          • Figure 35: Number of years over which companies involved in sports marketing plan their activities, May 2011
                                                                                                                                      • Trade Perspectives: Sponsorship Activation

                                                                                                                                        • Key points
                                                                                                                                          • Activation no longer an innovation
                                                                                                                                            • Figure 36: Most popular types of sports sponsorship activation, May 2011
                                                                                                                                          • Lack of resources and realism can kill off good intentions
                                                                                                                                            • Targeting spend: buy in to build-up or tackle off-season troughs?
                                                                                                                                              • Sponsors still learning social media etiquette
                                                                                                                                              • Trade Perspectives: Sponsorship Evaluation

                                                                                                                                                • Key points
                                                                                                                                                  • Increasing pressure to measure...
                                                                                                                                                    • Figure 37: Most popular methods of evaluating sports sponsorships, May 2011
                                                                                                                                                  • ... but time and money are against it
                                                                                                                                                    • Comparisons of the past live on in the present
                                                                                                                                                      • Hard proof is hard to come by
                                                                                                                                                      • Trade Perspectives: Sponsor Dissatisfaction

                                                                                                                                                        • Key points
                                                                                                                                                          • High admission prices and rising costs of sponsorship living
                                                                                                                                                            • Figure 38: Most common sources of difficulty encountered in sports marketing activity, May 2011
                                                                                                                                                          • Communication breakdowns
                                                                                                                                                            • Clutter still more threat than reality
                                                                                                                                                              • Properties playing catch up as sponsors change gear
                                                                                                                                                              • Appendix – Internal Market Environment

                                                                                                                                                                  • Figure 39: Sports/activities played or taken part in regularly, 2006-10
                                                                                                                                                                  • Figure 40: Most popular spectator sports, 2010
                                                                                                                                                                  • Figure 41: Share of TV coverage, by most televised sports, 2006-10
                                                                                                                                                                  • Figure 42: Sports coverage on television, by channel, 2006-10
                                                                                                                                                                  • Figure 43: Broadband penetration, by demographics, 2004-10
                                                                                                                                                              • Appendix – Segment Performance

                                                                                                                                                                  • Figure 44: Reported new sponsorship deals, by sport, 2009-11
                                                                                                                                                              • Appendix – Market Share

                                                                                                                                                                  • Figure 45: New sponsorship deals, by sponsor industry, 2009-11
                                                                                                                                                                  • Figure 46: Main sponsors, FA Premier League, 2010-11
                                                                                                                                                                  • Figure 47: Main sponsors, county cricket, 2011
                                                                                                                                                                  • Figure 48: Main sponsors, Aviva Premiership (Rugby union), 2010-11
                                                                                                                                                                  • Figure 49: Main sponsors, Magners League (Rugby union), 2010-11
                                                                                                                                                                  • Figure 50: Main sponsors, Super League (Rugby League), 2011
                                                                                                                                                                  • Figure 51: Main sponsors, European PGA Tour events staged in the UK, 2011
                                                                                                                                                                  • Figure 52: Main sponsors, Governing bodies
                                                                                                                                                                  • Figure 53: Other major sponsors, Governing bodies, 2011
                                                                                                                                                              • Appendix – Consumer Awareness

                                                                                                                                                                  • Figure 54: Agreement with statements on sponsorship, by demographics, 2010

                                                                                                                                                              Companies Covered

                                                                                                                                                              • Bank of Ireland
                                                                                                                                                              • BMW (GB) Ltd
                                                                                                                                                              • Bolton Wanderers Football Club
                                                                                                                                                              • BP p.l.c.
                                                                                                                                                              • British Airways Plc
                                                                                                                                                              • British Medical Association (BMA)
                                                                                                                                                              • BT Group plc
                                                                                                                                                              • EDF Energy
                                                                                                                                                              • Fédération Internationale de Football Association
                                                                                                                                                              • Football Association of Wales
                                                                                                                                                              • IFM Sports Marketing Surveys Ltd
                                                                                                                                                              • Irish Football Association
                                                                                                                                                              • J. Sainsbury
                                                                                                                                                              • JJB Sports Plc
                                                                                                                                                              • Kantar Media
                                                                                                                                                              • Lloyds Banking Group
                                                                                                                                                              • Mercedes-Benz UK
                                                                                                                                                              • Newcastle United PLC
                                                                                                                                                              • P&O Ferries
                                                                                                                                                              • Professional Golfers Association
                                                                                                                                                              • Rugby Football League
                                                                                                                                                              • Samsung Electronics (UK) Ltd
                                                                                                                                                              • Scottish Football Association
                                                                                                                                                              • Tottenham Hotspur PLC
                                                                                                                                                              • Union of European Football Association (UEFA)
                                                                                                                                                              • West Ham United Football Club

                                                                                                                                                              Sports Marketing and Sponsorship - UK - June 2011

                                                                                                                                                              £1,995.00 (Excl.Tax)