At 6.72% CAGR, Sports sponsorship Market size is expected to reach $89.60 Bn by 2027 Says Brandessence Market Research
PUNE, India, Jan. 19, 2021 /PRNewswire/ -- Global demand for sport sponsorship market size, in terms of revenue, was worth of USD 57.00 Billion in 2020 and is expected to reach USD 89.60 Billion in 2027, growing at a CAGR of 6.72% from 2021 to 2027. The global sport sponsorship is expected to grow at a significant rate due to the number of driving factors.
Top Sports Sponsorship Companies:
Adidas, Nike Inc., Pepsi Co., Rolex, The COCA-COLA, Reebok, Puma, Samsung, Red Bull, Castrol Others
The study provides a crucial view of global sports sponsorship market by segmenting the market based on type and region. On the basis of type, global sports sponsorship market is segmented into football, basketball, hockey, rugby, volleyball, cricket and others.
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Sports sponsorship market is booming, never before has more money been put into marketing with athletes, sports teams, or sporting events. According to a study, athlete endorsements have been shown to generate a 4% increase in sales – which corresponds to an average of $10 million in additional sales annually – and nearly a 0.25% increase in stock returns. Sponsorship is a business relationship between a provider of funds, resources or services and an individual, event or organization which offers in return some rights and association that may be used for commercial advantage. The sponsorship includes mainly three objectives to be co-created and or fulfilled by sponsor and sponsee. First of all, they have co-designed the first ever performance optimized esport jersey. Second, they have already launched a merchandise collection. Lastly, they are to introduce a varied range of activation initiatives. Digitalization offers sponsors completely new opportunities as a few years ago, sponsorship still meant having company's logo on sports assets presented to the media. Today, sponsorship is the opportunity to run storytelling and content marketing – in times of information and advertising overload, this is especially attractive for brands. In connection with the digital possibilities, enormous opportunities arise for global players as well as small start-ups.
Global Sports Sponsorship Market Segmentation:
By Type Analysis: Signage, Digital activation, Club and venue activation, Others
By Application Analysis: Competition Sponsorship, Training Sponsorship, Others
COVID-19 Impact Analysis on Global Sports Sponsorship Market
Covid-19 has affected the global sports sponsorship market quite a lot and this is one of the major sectors impacted by this pandemic situation. Due to this pandemic situation, the cancellation of mass gatherings was one of the major steps taken by governments worldwide to fight against the spread of COVID-19 which severely affected the sport sponsorship industry. So, the sporting bodies must follow these measures by cancelling or postponing the event or by introducing restrictions on sporting events to enable them to take place later. Thus, no sports events means no benefits for sponsors from live events which is the major source of income for most of the organizations in this industry. Thus, all these consequences of Covid-19 have shown a direct and negative impact on the growth of global sports sponsorship market.
The global sport sponsorship market is expected to witness a lucrative growth within the forecast period owing to growing awareness about the benefits of sport sponsorship coupled with the technological advancements in this field drives the growth of global sport sponsorship. Sporting organizations across the world depends on sponsors to provide funds, products, and services, which further supplement the profitability for all the associations involved.
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Furthermore, the increasing numbers of new sport events around the world are providing an avenue for new sponsorships across different sports which include the launch of new tournaments as well as the expansion of existing competitions in new venues. These kind of activities are attracting more audiences and encouraging the sponsors to invest in these events. The recent studies states that the use of sport sponsorship as a marketing technique is increasing in popularity globally. The benefits and potential return on investment (ROI) associated with aligning a brand with a sport, sports team, or athlete, usually outweigh the possible problems. Major advantages of sport sponsorships are; to target specific market segments, increase brand recognition, build relationships with consumers by aligning a brand with an athlete/team, and enhance image through association with winning athletes/teams.
The type segment of sports sponsorship market is segmented into football, basketball, hockey, rugby, volleyball, cricket and others. The type segment of sports sponsorship market is dominated by football by capturing the largest market share 36.05% in year 2020. Basketball accounted for the 17.84% share of global sports sponsorship market in the year 2020.
North America held the largest market share of 34.57% in 2020 of global sport sponsorship market within the forecast period owing to the emergence of new sporting events coupled with the increasing sports sponsorship spending. The baseball and basketball leagues in this country portray the highest adoption rate of these technologies. The world of sports sponsorships is mainly driven by North America. For every single dollar spent in sponsorships worldwide, approximately 37 cents come from the American and Canadian markets, where the starred and striped states play a leading role. The North American continent spent 24.2 billion in sponsorships in 2018 which is 10 billion more than the yearly spending in Europe. Asia-Pacific is expected to be a promising market growing with a CAGR of 6.65% owing to the increasing inclination towards sports and it offers good growth opportunity for various sports sponsorship vendors. This shift can be attributed to several factors, including the rise of mobile and digital penetration coupled with the proliferation of general entertainment content and a lack of deep-seated, generational sport passion in Asia.
Market Opportunities
Relatively recent emergence of new media such as social media, online channels, and digital platforms has also affected sports sponsorship market as the brands are not only looking for promotion in TVs but also taking significant step in advertising their brands through World Wide Web. This trend is currently growing explosively and is helping the brands to sponsor their products through sports in a new platform comparatively new from traditional channels, creating new opportunities for sports sponsorship market.
For example, Hotstar, the streaming platform has declared Dream11, Uber Eats, Amazon Pay and Coca Cola as the co-presenting sponsors in 2019 for all its sports events with associate sponsors includes Royal Challenge, Acko, CEAT and ICICI Lombard. Further many experts have concluded that digital medium could have share of 20-25 percent of overall sports advertisement in 2019. One of the main reasons for the opportunity that is coming through digital channel is the massive viewers that are using streaming websites for their entertainment purpose. For example, if user compares the viewership of best TV running shows that generates 200-250 Billion viewers in two months, but a cricket world cup generates viewership of about 300 Billion on streaming side.
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Another fact that is favorable for digital sponsorship of sports is the active participation and democratization of viewers which creates different flavor for both advertisement purposes as well as in sponsoring sports in social media platforms. In addition, there is an increase in the interest of viewers in second screening, triple screening and talks about games, hit moments, analyzing matches over twitters and other social media platforms. The further development in this area is that fans can demand particular content whenever and wherever they want. They can watch 15 second highlights reels of a match; can look for apps to provide them latest stats on players, behind scene contents along with instant reactions etc. All these features and benefits will be more integrated with sports sponsorship as the companies would more likely use digital media platform to sponsor their brands not in a particular time as in television, but all around the day.
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