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.

Minimal Investment, Maximum Impact 20th December, 2016

There are certain features we expect from any sponsorship deal involving a major international brand. Usually this involves months of strategic planning, a slick marketing roll out and accompanying integration and activation to help bring it to life.

This only comes after complex back and forth negotiations over contract signings to ensure that each party involved will receive what they desire; normally exposure for the brand and income for the rights holder.

However, this week a sponsorship deal was announced that seemed more like a playful idea than a well thought out plan, but that doesn’t seem to have lessened its impact.

The sponsorship link up is between Diageo owned alcohol brand Captain Morgan and Leicester City Football Club captain Wes Morgan. What makes this work essentially starts and ends with the respective names; both are Captain Morgan. Given that any Premier League footballer needs to have an excellent level of fitness it is unlikely he very often drinks alcohol, so he is not your typical brand ambassador.

The main driver of the deal was seemingly to create an instant impact online and in the press. In essence, the deal signing itself was the strategy and activation. In order to ensure maximum coverage the funny and unusual terms of the contract were released, including Captain Wes Morgan having the entitlement to “enter any licensed premises and buy every patron a Morgan and Coke” but only after starting a chant of “there’s only one Captain Morgan.” He is also required to dress up as Captain Morgan “should the opportunity arise.”

The deal was announced through a twitter photo instead of an official roll out, with Wes Morgan tweeting his signing of the contract directly to his followers and allowing them to see the terms for themselves.

The unusual terms meant it gained instant traction online and in the press, being picked up by national newspapers and international sports websites as well as being widely shared on social media.

The traditional marketing campaigner may see this as an unthoughtful approach, but this kind of guerrilla marketing, especially in the run up to Christmas, is an innovative and effective way to reach a large audience with minimal financial investment and maximum impact.  Fewer employee hours, minimal activation costs and no paid for press coverage mean the return on investment is likely to be more favourable than an expensive traditional media campaign.

This is not an indication that more strategic and considered sponsorship tactics are becoming any less effective, more an indicator that there is more than one way of making an impact, and in this instance it seems ideal.

Is Quantity or Quality More Important in Football Sponsorship? 27th June, 2018

Whether it’s Arsenal’s sleeve sponsorship deal with Rwanda’s tourist board or Manchester City’s sizzling hook-up with Tinder, the sheer quantity of football team sponsors has exploded in recent years.

You don’t have to think too far back to a time when clubs would have been more than happy to simply enjoy commercial ties with a kit supplier for team equipment, with a major sponsor’s logo splashed across the front.

However, in the age of globalisation, sports organisations – and their potential partners – see sponsorship as an enabler of expansion. This allows both clubs and brands to reach millions of potential new fans and consumers wherever they’re based, while of course remaining a key way to drive revenues.

Who is making the most of these opportunities?

Manchester United perfectly embody this renewed approach to sport sponsorship. Already a global brand with fans and non-fans alike, in recent years the Red Devils have aggressively pursued sponsorships and commercial partnerships from less traditional industries across the globe.

For example, United’s Integrated Telecommunications Partners are split up by region. This means that they have separate sponsors in many different territories, such as STC (Saudi Arabia), TM (Malaysia) and others in Hong Kong, Azerbaijan, Bahrain, Kuwait, Nigeria and Ghana. This approach allows the club to maximise potential revenue in just one specific industry.

More obscure sponsors include Japan’s Nissin Foods, who are Manchester United’s official global noodle partner (yes, really). Malaysian brand Kansai are proudly the official paint partner of the club, while in May 2018 United extended its deal with Chinese company MLILY to be their official mattress and pillow provider. These are all in addition to more traditional financial and motor companies who are considered part of their 22 “global partners”.

What are the positives and negatives of this?

Quite understandably, the main argument for this proliferation of brand sponsorships is that it boosts clubs’ coffers whilst also raising its profile in less traditional markets. In time, this expanded fanbase will generate future income thanks to merchandise sales and so forth. Meanwhile, sponsor brands benefit from increased exposure and its allegiance with a successful, popular club.

However, this explosion in sponsorships can also have a negative impact if not handled correctly. The sheer amount of sponsors a club could attract can dilute their image of exclusivity and prestige, which prospective sponsors may view as a drawback to any potential involvement. Such a multinational and seemingly unselective approach to sponsorships could also erode the identity that years of success and history have helped to create.

So what does the future look like?

There is an argument for clubs to reconsider this approach and focus on fewer, more focused and appropriate brands. This could result in greater bargaining power for clubs as they take back some of the feeling of exclusivity they have gifted away – albeit at a profit, of course.

With the 2018 Premier League television deal worth over £4.5bn – a somewhat surprising drop of around £500m on the previous deal in 2015 – there is an indication that the vast sums from this vital revenue source may have peaked. Clubs will be buoyed, then, that brands are showing no signs of being put off by the prospect of teams retaining more and more sponsors.

Although if the trend continues on the current path, there may come a day when less in considered more in the world of football sponsorship.