Football

Sponsorship in Football and the business around it Part 1

Photo: Daily Mail

This article will first focus on different types of  kit sponsorship and how it works.

For the lovers of football, that team you follow diligently especially for the work they put on the pitch, there is more going on behind the scenes in business side of things that helps these teams remain financially healthy and to pay those big wages for your favorite players. Lets use the EPL as the casing point,it being the most watched league.

Nearly two and a half decades ago, it would have been unheard of to see any external branding on a football shirt other than the club name and logo. Now, companies are queuing to secure space on the kit of top Premier League teams. Over the seasons we have seen different companies having their names on teams’ shirts ie Yokohama- Chelsea, Standard Chartered-Liverpool, Chevrolet -Manchester United etc which will probably change in the future depending on the contractual agreement between clubs and these companies.

Companies get into this type of sponsorship mainly to create brand awareness in an era where there is a lot of competition in the market. With the vast global reach that the Premier League offers, these brands would want a piece of that. With exposure comes association; this means that brands who advertise on top football shirts immediately become household names, just like the teams they sponsor. These deals are not cheap to say the very least! Manchester United’s 2014 deal with car manufacturer Chevrolet was worth 450M Pounds in a span of 7 years where its roughly 64.3M Pounds a year!! It is one of  the most lucrative deals in the PL!

As much as companies long term goal is to make profits, they want to be associated with clubs that represent their values and beliefs hence the issue of a perfect fit.

In addition to this lets not forget the kit manufacturers/suppliers ie the likes of Adidas, Nike, New Balance, Under Armor, Puma. These companies prime objective is to manufacture and supply clubs with game and training kits but not limited to this. They also distribute these kits in their stores worldwide. Recently Liverpool won a case against kit manufacturer New Balance. New Balance alleged the club was refusing to honor the terms of its reported $52.6 million-a-year deal, which expires in May. Under the terms of the deal, New Balance said it was entitled to renew its deal with Liverpool if it was able to match offers made from rival kit suppliers. However, Liverpool argued New Balance -which has been its manufacturer since 2015-could not match Nike’s potential marketing and distribution powers and the High Court in London ruled in the club’s favor.

Clubs have different stipulations in their deals with manufacturers, for instance Liverpool’s deal with Nike for next season, the club is expected to earn a percentage from shirt sales. Nike will also help Liverpool break into markets they haven’t been able to properly penetrate, such as the lifestyle market. On the other hand what Liverpool brings to the table is a club which has always had a global following, a club that is now getting back as a footballing powerhouse and well, current Champion’s League winners and maybe just maybe soon to be Premier League winners. Then there is the Klopp factor which is just attractive!

Lest we forget sleeve sponsorship! Yes, its a thing! Introduced in 2017, it sees brands put their names or logos on the left sleeve of kits. Remember Arsenal’s ‘Visit Rwanda’? If not kindly read the article below:

‘Visit Rwanda’ where is ‘Visit Kenya’?

In Kenyan football sponsorship has been an issue in recent times with teams lacking sponsors! Corporates have shied away and especially teams that were sponsored by betting firms are feeling the heat with these firms withdrawal from Kenya. For Kenyan clubs to realize the potential and opportunities that these deals have first the numbers in our stadia has to improve, teams have to be properly managed and these clubs have to be a brand meaning have an online presence, good reach and following.

As indicated earlier it is a mutually beneficial relationship hence both sides have to bring what the other needs on the table!

 

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