Shirt Sponsorships

galaxyPutting your company name front and center on a team’s jersey could arguably be seen as a wiser investment than placing your name on the team’s stadium.  In Europe, some teams are finding kit sponsorships even more profitable than stadium deals thanks to increased levels of investment.

According to the research firm Repucom, the British Premier League experienced a 20% increase in shirt sponsorships in the 2014/15 season following a 36% rise in shirt sponsorships the season before.   Chelsea AFC, one of the league’s biggest clubs, recently agreed to a deal with Yokohama Rubber Company worth $61.4 million per year.  Even greater, Manchester United is in the middle of a $70 million per year deal with Chevrolet.  According to CNN, Qatar Airways spends $181 million a year to be the jersey sponsor of Barcelona, arguably the most recognizable soccer team in the world.

Jersey sponsorships do not come without controversy.  In England, Newcastle United has been forced to remove the Wonga logo from its children’s replica jerseys starting in the 2016 season because the company is a payday lender.  In Spain 86% of all jersey sponsorships come form outside of Spain.  While this is excellent marketing for companies looking to increase their international reach, its one less avenue for companies within the country to push their own names.

Jersey sponsorship in MLS totaled $55.8 million, which is higher than the Netherland’s top league, the Eredivisie.  In 2012, 13 teams had kit sponsors and today, 18 out of the 20 teams have sponsors. The team with the greatest deal, the LA Galaxy still only makes $4.4 million per season from Herbalife.  As the league continues to grow in international prominence, time will tell if these jersey sponsorships grow in size and scope. Here is a promotional video hyping  the new Sporting Kansas City jersey, with sponsor Ivy Funds, introduced this past Wednesday.

REFERENCES

http://edition.cnn.com/2015/02/24/football/football-shirt-sponsorship-deals/

http://www.totalfootballmag.com/features/world-football/how-do-mls-kit-sponsorship-values-compare-to-europe/

http://www.businessofsoccer.com/2014/07/11/mls-jersey-sponsorship-tells-two-different-stories/

http://www.mlssoccer.com/news/article/2014/03/03/jersey-week-2014-la-galaxy-unveil-new-primary-kit-updated-sash

Coca-Cola Sponsors Major League Soccer

coke mlsThis weekend, MLS, as well as U.S. Soccer, and the Coca-Cola Company announced a new sponsorship agreement  that will last four years.  This new agreement will allow Coca-Cola to use MLS and U.S. soccer player appearances at hospitality events, gives the company the right to use MLS and U.S. soccer marks in its original media content, as well as in-stadium signage.

This deal marks the end of the original agreement between MLS and PepsiCo Inc. that lasted from the birth of the league in 1996 to December of last year.  PepsiCo. recently announced a monster deal with the NBA, ending a partnership that Coca-Cola held since 1986.

The Coca-Cola Company is the largest beverage company in the  world with over 500 brands under its portfolio. The company has 20 brands that make over $1 billion annually in retail sales and a reputation as one of the most recognized brands in the world.  According to MLSSoccer.com, this agreement will make Coca-Cola the official beverage partner in the carbonated and water beverage categories of MLS and the official non-alcoholic beverage of U.S. Soccer. Coca-Cola is already a regular sponsor of the World Cup, and has been working with FIFA since 1974, giving the company plenty of experience in terms of sponsoring soccer events. Here is an example from Coca-Cola’s powerful “One World, One Game” ad campaign during last year’s FIFA World Cup in Brazil that promoted inclusiveness.

This agreement serves as another example of how Major League Soccer’s growing popularity is enticing greater investment by large companies.  Combined with the league’s agreements with Mondelez, Johnson & Johnson, and Audi, MLS is quickly building an impressive portfolio of corporate sponsors.  Coca-Cola clearly sees how it can reach its target market of millennials through partnering with the league and how it can attract the rising Latino population in the United States through greater exposure by way of soccer entities.

REFERENCES

http://www.bloomberg.com/news/articles/2015-04-13/mls-u-s-soccer-sign-four-year-sponsorship-deal-with-coca-cola

PepsiCo nabs NBA sponsorship rights from Coca-Cola

http://www.mlssoccer.com/news/article/2015/04/13/mls-us-soccer-federation-announce-new-partnership-coca-cola-company

Sponsorship Success

Mondelez, the Official Snack Provider of MLS
Mondelez, the Official Snack Provider of MLS

In the past two weeks, Major League Soccer has announced two major sponsorship deals with the Mondelez snack food conglomerate and the U.S. branch of the Audi automotive group.  The Mondelez partnership will last for two years, while the Audi deal was only announced as a multi-year partnernship.  According to Forbes, this marks a trend in sports marketing where sponsors are choosing to align with soccer over baseball due to millennials being more attracted to the less established sport.

Mondelez is the manufacturer of Oreo, Trident, and Ritz, and is already in the middle of a partnership with the U.S. Soccer Federation that organizes the national teams in the FIFA World Cup. Under the deal, Mondelez brands will have exposure at MLS stadiums, league media platforms, and the right to activate campaigns for major league events such as the All-Star game and MLS Cup final. The company also has the licensing rights to use four players for advertisements and product packaging. According to Forbes, Stephen Chriss, the head of the company’s consumer engagement and marketing in North America  said that working with MLS allows Mondelez to market both nationally and at a grassroots level thanks to the nature of the league.

Under the Audi agreement, Audi will have field-level signage during nationally televised broadcasts, become the presenting sponsor of the MLS Cup Playoffs, and air MLS-themed commercials during these games as well.  Here is the latest commercial that aired during the NYCFC home opener on ESPN2.

These deals show the growing profile of MLS’s popularity in North America and how large companies have been noticing the demographics of fans going to games.  The most notable part of the deals were the importance of a digital presence for ads by Mondelez due to MLSSoccer.com’s reputation.  If the trend continues, MLS could be on pace to gain more sponsorships by companies looking to reach millennials while sports slowly losing appeal due to the length of the game, like baseball, could have many reasons to be worried if adjustments aren’t made soon.

REFERENCES

http://www.forbes.com/sites/chrissmith/2015/03/19/snack-food-giant-mondelez-to-be-official-partner-of-major-league-soccer/2/

http://www.forbes.com/sites/davidlariviere/2015/03/07/major-league-soccer-audi-sign-multi-year-partnership-deal/

http://www.mlssoccer.com/news/article/2015/03/06/mls-announces-partnership-audi-including-presenting-sponsorship-mls-cup-play