How brands are pivoting sports sponsorship in the face of COVID-19

Menulog, Boost Mobile, Colgate and Telstra are just some of the brands rethinking their sponsorship of sports as the unprecedented crisis hit. CMO explores the marketing strategy behind their thinking


New engagement mechanisms

For some brands, the reshuffle of sponsors resulting from the COVID-19 crisis has actually created opportunities to new forms of engagement.

For Boost Mobile, the COVID-19 crisis presented an opportunity to get deeper into sports the brand has traditionally been connected with in Australia – Supercars. Boost Mobile general manager, Jason Hayne, says action-oriented sports has been a favourite playing field for the brand, which has historical ties to motorsports and surfing, while also sponsoring numerous brand ambassadors.

So when one of the title sponsors of the fourth car in the Tickford Racing team pulled out due to COVID-related reasons, he saw an opportunity to step into the gap. This also enabled Boost to get its brand ambassador, James Courtney, back behind the wheel of a car following his decision to quit the Team Sydney project earlier this year.

“Tickford had to find someone to come in and fill that role for that fourth car,” Haynes says. “We were looking to solve how we would get back into Supercars and get James Courtney into a car.”

The arrangement goes far beyond just placing decals on a car and driving suit. Boost Mobile pays Tickford to run the car and the team and also pays the driver, and can sell the sub sponsorships on the car.

“It is almost like running a team without owning a licence,” Haynes says.

Haynes says having such a deep involvement suits Boost Mobile’s desire to be a vocal proponent of the sport, rather than just a passive advertiser. Like other brands, Boost has also turned to digital channels and user generated content to connect fans with the sport and their heroes, and has been actively working with its ambassadors to create and develop content.

“To be authentic in these spaces it has to be more than just branding and logo placement,” Haynes says. “And it has always been more than that for Boost. The people that work at Boost live and breathe it and immerse themselves in these cultures.”

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Digital realm

While many traditional sports have struggled because of the COVID-19 crisis, one group – esports – may find itself benefitting in the long term. While face-to-face events have been cancelled, gameplay and livestreaming have jumped remarkably. Gamer streaming platform, Twitch, for instance noted its audience grew by a third in March, and brands are taking notice.

Numerous sporting leagues and competitions have also launched or strengthened esports offerings, such as the virtual Grand Prix hosted by Formula One. These initiatives have caught the eyes of marketers, including at Menulog, which has signed on to sponsor the ESL ANZ Championships.

Cheng says this relationship also serves to help Menulog reach additional audiences. “A large portion of the esports audience are an underground audience that can’t be reached through other media,” he says. “It is all incremental audiences. And there is a natural fit between our product and their product.”

While the short-term impact of the COVID-19 crisis is plainly apparent, the impact of the recession that will follow is less clear. With the IMF expecting the Australian economy to contract by 6.7 per cent this year, there will be obvious repercussions for marketing and sponsorship budgets. Similarly, sports fans are likely to have less disposable income at hand to spend on their passions – or may find themselves simply unable to do so should social distancing measures remain in place.

“Even when sport returns it is still not going to be the sport that we know, and the whole experience around sport is going to be vastly different,” says O’Rourke. “We are not going to see the MCG packed out like it used to be for at least another nine months.”

At the same time, he says the crisis has given fans a more personal look at their sporting heroes, by showing them in unscripted scenarios, and by welcoming them into their homes.

“We are all in together – that is the narrative,” O’Rourke says. “Athletes and celebrities have often been seen as ‘other worldly’ entities that are more than arms distance away. There is something engaging about seeing in the background see what Ellie Carter from the Matilda’s living room looks like.”

O’Rourke also believes the growth and interest in esports will continue long after COVID-19 restrictions are lifted.

“But if you look at things that haven’t evolved, its badging exercises,” he says. “They don’t work anymore to create cut through because fans are so used to seeing logos, and brands involved in sport become white noise. What we’ll end up seeing the future is creativity to activate partnerships, and for brands to get a lot deeper in them, as opposed to them being an afterthought.”

That thinking is very much on the mind of Haynes and the Boost team. “The value proposition is going to be different,” he says.

“What brands can and can’t offer needs to be reset. We are doing what makes sense now, but in the long term it is going to be different. So what is the new normal, and what are the new expectations from a brand and what’s provided from a sport or organisation?”

At the same time, with some sponsors having pulled back from their investments (or having ceased to exist), that leaves significant room for new names to join the roster. And as players start to return to the courts, fields and pitches, many marketers and agencies are looking at the opportunities to fill those gaps.

According to Wavemaker group business director, Jamie Connolly, who was the client lead on the Colgate relationship, sport will continue to represent a means of authentically reaching mass audiences.

“If I had some budget and was able to, would now be a time to go into that market and establish yourself?” he asks. “Potentially yes, because if there are deals to be had and you can sew something up, in three, five or 10 years from now, we are still going to be looking at the sports environment as a highly effective way to do what we need to do.”

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia.

 

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