Standing Out from the Crowd 7th February, 2017

The digital music streaming industry has become extremely crowded in recent years with several leading companies vying for market share and growth. In order to differentiate themselves, the major competitors are choosing ever varying strategies, with sponsorship emerging as one of the most innovative.

As of September 2016 over 100 Million users worldwide paid for a music streaming service, a figure that is constantly growing. The most streamed songs on Spotify, the world leader in terms of paid music streaming services, have over 900 million listens. Spotify, along with Apple Music, Tidal and Pandora (US only) have emerged as market leaders with others such as Deezer and Soundcloud also competing for the same substantial audience.

The key way these companies have tried to differentiate so far is through unique content. Tidal offer exclusive, high quality music videos. Artist exclusivity is also a tactic used by Tidal, as well as Apple Music, while Spotify has concentrated on having the largest offering.

Deezer has recently adopted a new tactic of differentiating through sponsorship. Deezer, a French based company with 6 million users worldwide, has partnered with Manchester United Football Club and Barcelona Football Club as “Official Music Partner.”

Traditionally Deezer has relied on B2B deals to increase its user base through partnerships with mobile networks. This new approach showcases Deezer adopting sponsorship as a key part of their marketing and expansion strategy. Deezer will appeal directly to consumers, encouraging them to download the app out of choice, rather than receive it through a tie in.

This innovative partnership with football teams works particularly well given the strong link between sports fans and music fans.  Whether unveiling a new player with the help of a musician, as Manchester United, Adidas and Stormzy recently did, or the frequent appearance of new bands on popular TV show Soccer AM.

Deezer are guaranteed to meaningfully engage this audience as players will create new playlists which fans can download. Deezer will also be responsible for the music on match day where further activation and consumer engagement will be possible. Deezer will not only benefit from the direct access to fans, but association as the music streaming service for sports fans.

Deezer are attempting to open a whole new channel to reach consumers, purely through sponsorship. Of course, Deezer’s competitors may choose to replicate this strategy, but Deezer’s imagination and creativity in using sponsorship as a differentiation tool gives them first mover advantage and a perception of originality that is crucial in such a competitive market. This is a demonstration of the power of sponsorship when seeking to stand out from the crowd.

EPL, Bendtner & Nalbandian: How Branding IS Still Relevant, No Matter What The Cost 2nd August, 2012

I wrote a blog a few months ago called ‘Sponsorship – More Than Just Branding’.  Whilst it’s palpable that sponsorship has evolved into far more than straightforward logo placement, it’s important not to forget that branding – be it via naming rights, advertising hoardings or shirt sponsorships – is still relevant within our industry and most importantly, still deemed hugely valuable in the eyes of sponsors.

On Monday, General Motors signed a colossal £175 million deal with Manchester United that will see the Chevrolet logo replace Aon on the front of the club’s shirt for the next seven years.  Chevrolet will be provided with numerous additional benefits from their shirt sponsorship (via advertising, hospitality etc.) but primarily their logo position on United’s shirts will promote brand perception of ‘success, speed and superiority’.  Further it will automatically garner favour with United’s 659 million followers worldwide, as General Motor’s VP for N. America states: ‘this is about connecting the brand with Manchester United and its passionate supporters around the world.’

And it’s not just the Premier League’s most famous teams that are seeing such significant returns on shirt sponsorships, with the likes of Sunderland attracting substantial investment from their lucrative partnership with Invest in Africa. Recent figures reveal a 25% increase in English Premier League shirt sponsorship to £147 million, dampening fears that the EPL as a brand would suffer as the British economy entered its second dip in four years.

Now, while these shirt sponsorships represent the more expensive side of branding within sponsorship, a couple of incidents a month or so ago, illustrate that (clever/accidental) logo placement can still generate positive brand perception and awareness on a budget.

Firstly, David Nalb(r)andian  took out a knee-height Nike hoarding, along with an umpires shin, after failing to return a base-line shot from Marin Cilic.  This was followed shortly by the boxer-gate affair surrounding Nicklas Bendtner’s Paddy Power lined briefs, which he revealed after scoring his second goal in Denmark’s 3-2 defeat to Portugal.

Both men were disciplined accordingly – Nalbandian receiving disqualification from Queens and Bendtner receiving a hefty fine – and received their fair share of press attention.  Granted the Nike hoarding board was not the focal point of such attention over Nalbandian’s kick-out, but it was in Bendtner’s case, and Paddy Power got a huge amount of publicity and engagement out of it.

Their Facebook page was awash with comments from users acclaiming their ‘genius’ marketing strategy and the story was covered byevery major broadsheet.  While I don’t conform to the consensus that a distinctly average footballer wearing a green pair of briefsconstitutes exceptional intellectual aptitude, it was rather clever.

For just £80,000 (the price of Bendtner’s fine, which Paddy Power agreed to pay) the Irish bookmakers got nationwide exposure and saw thousands of additional online users flock to see what other mischief Paddy Power have been up to.

Obviously Bendtner’s boxers can’t be compared with Chevrolet’s United sponsorship in terms of worldwide reach, but you’d be hard pushed to say that it’s not better value!