Digitally Activated: Sports Centered

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A Marketing Solution Offered by Tottenham

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Did the EPL club Tottenham Hotspur revolutionize European soccer sponsorship?  I will argue in favor of this proposition.  Furthermore, I will contend that the Spurs decision to separate its kit sponsorship into league and cup components  – while a strategically sound business decision on their part – demonstrates the ability of clubs to create customized solutions for current and future business partners.

When Tottenham signed Investec to a two-year, £5 million jersey sponsorship agreement for cup competitions, the club increased its jersey sponsorship by 25%.  An achievement which validated the team’s decision to pursue multiple jersey sponsors, but did not help the club surpass Chelsea in terms of jersey sponsorship revenue.  However, I believe we can all agree that in terms of prestige, the North London club is a notch below their counterparts in the West.  Therefore, the 10% gap in jersey sponsorship is more of an affront to Chelsea than the Spurs.  Moreover, the Spurs decision to pursue two-year contracts should not be discounted.  I believe it is indicative of the club’s long-term business interests.

The Spurs have held informal talks with London’s, Olympic Park Legacy Company about making a bid for Stratford Stadium following the 2012 Olympics. The club’s marketability would increase exponentially with a move to Stratford Stadium.  Upon moving to Stratford Stadium, the team could continue having multiple jersey sponsors, tie their stadium naming rights to a jersey sponsorship (unlikely because of the cautionary tale which is Arsenal’s deal with Emirates Airlines), or have a primary jersey sponsor and a separate stadium naming rights partner.  The course of action which the Spurs choose to embark upon will determine if the club can develop a brand with assets which are beneficial to its partners.

A sponsorship’s effectiveness is measured in a brand’s ability utilize a property’s image and trademarks to drive its business objectives.  Thus, we must examine the business objective of Autonomy (league play) and Investec (cup play).

Autonomy, with a market cap of $6 billion, has the resources to spend to spend an extra £2.5 million to procure the rights for cup play.  Their decision to only secure the rights for league play must be driven by a company focus.

Autonomy is a b2b software infrastructure company.  Consequently, hospitality packages are an important component of any sponsorship which they enter, and the Spurs’ North London location appealed to their interest.  Moreover, EPL matches which are broadcasted in Asia during primetime, are more important to their business interests than Champions League matches; which reach a greater percentage of European countries – where the company’s strength is – but are broadcasted in the middle of the night in Asia.  Conversely, the Champions League format coincides with the business interest of the Spurs’ cup partner.

Investec is an international specialist bank and asset manager based in South Africa, where the Spurs brand is strong due to a 2003 tour and win in a South African international tournament.  Investec caters to a select client base, and focuses its interest on countries of Anglo-Saxon origin.  Having a select clientele, hospitality was a major consideration in the firm’s sponsorship evaluation.  Furthermore, an emphasis on cup play enables the company to expand its footprint in European markets.

The Spurs decision to have multiple jersey sponsors is indicative of a growing trend amongst professional sports franchises to offer specialized marketing solutions to their partners.  It is incumbent upon sports properties to demonstrate that they understand the business objectives of their partners.  The properties that place their partners objectives at the forefront of a sponsorship will have the most success in this decade.

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Written by Peter Amador

August 26, 2010 at 8:28 PM

3 Responses

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  1. […] Soccer Sponsorship August 27, 2010 tags: EPL, Soccer, Sponsorship by UM ESLS Interesting blog post from Peter Amador about Tottenham and the club’s strategy for its jersey sponsorship. The […]

  2. Do you know the plans on kits? Will they release two, one for each sponsor, hoping consumers buy two? I’m sure there are some fanatical fans who would, which would prove another stream of revenue from having two sponsorships.

    Although it could backfire. It does increase revenue for the team in the short term, but will it hurt in their long run branding efforts? Guess we’ll have to wait and see.

    Tom Scovic

    August 27, 2010 at 6:43 AM

    • Tom – Thanks for the comment. I believe they are planning to release two kits for sale at retail. You are correct to believe that those sales should provide the Spurs with some incremental revenue. To your question concerning whether having multiple kit sponsors will affect the club’s branding efforts, I do not believe it will. Performance on the pitch will always determine a team’s marketability outside of their own market (in-market is a different subject). However, it is important that they work to renew one or both kit sponsors after their contract expires in ’12. Their brand would lose credibility if the are consistently changing the name on the front of their kit. m – Thanks for the comment. I believe they are planning to release two kits for sale retail. You are correct to believe that those sales should provide the Spurs with some incremental revenue. To your question concerning whether having multiple kit sponsors will affect the club’s branding efforts, I do not believe it will. Performance on the pitch will always determine a team’s marketability outside of their own market (in-market is a different subject). However, it is important that they work to renew one or both kit sponsors after their contract expires in ’12. Their brand would lose credibility if the are consistently changing the name on the front of their kit.

      Peter Amador

      August 29, 2010 at 12:30 PM


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