As the world’s sports industry is seeing continuous growth with no signs of slowing down, the growth of the number of people consuming it runs parallel. In the information age that we are presently in, the world’s digital capabilities are flourishing, especially in developing countries. By capitalising on the sheer size of this market, businesses have the ability to reach international audiences and grow their consumer base.

A digital marketing channel which is seen regularly within the sports industry is sponsorship where businesses are sponsoring sports events across the globe. Thompson (2016) suggests that the ultimate goal of digital sponsorship would be creating mutually beneficial content which in turn encourages consumer retention for both parties involved.

(Bacon, 2016)

Looking at the graph presented above, it is clear that the viewing habits of fans across the globe is shifting and this is ever present in emerging markets such as Brazil, India and China (Bacon, 2015).

Examples

One of the first major examples of digital sponsorship was Budweisers campaign in which they sponsored the 1998 France World Cup on the Sky Sports site. Cracknell (2001) states that Budweiser’s strategy was to target males aged 18-34 in order to inform them of their business whilst emphasising their sponsors of the event. The sponsorship was a success and has led to the two companies continuing to work with each other to this day.

Another example of a sponsorship deal which perfectly highlighted the collaboration between two companies is the deal between theSPORTbible and Table Tennis England which featured a qualifying match being streamed exclusively on theSPORTbible’s facebook page. Due to sports associations being more aware of the change of demographic concerning viewing habits, they understand that more young people are using the internet to view things rather than TV. Due to this, there was an opportunity for theSPORTbible got utilise their platform, which gets more than 110,000,000 views a week, to sponsor the event (Madill, 2016). This case again highlights the increasing digital consumption of sports which businesses should be aware of in order to exploit the market.

Risks

Of course, utilising digital sponsorships isn’t a risk-free procedure and ultimately such large deals can be extremely difficult to negotiate, especially in the rapidly growing market, where the demands from consumers are ever changing. Imada (2017), explains that one aspect of digital sponsorships that is often overlooked is whether the deal is targeting the right audience. For example, a deal which targets an audience of 18-24 males which actually resulted in more impressions from people from other age groups, or females, would not be considered a successful sponsorship. This can be very costly for businesses as sponsorship deals in such a rapidly growing market can be extremely expensive.

Another risk for sports sponsorship deals is unforeseen events which more often involves the sporting committees. An example of this is International Association of Athletics Federations corruption allegations which led to Nestle ending the 5.6m a year deal. Kinmont (2016) suggests that due to many similar events like this happening, sports sponsorships are increasingly risky business. This has also been evident with deals with FIFA, with many sponsors shying away from deals due to corruption. Bowden (2017), explains that this has led FIFA into a position where they are struggling to find a sponsor for the 2018 World Cup in Russia.

Taking the risks into consideration, a digital sponsorship deal still has the potential to benefit both parties exponentially, and this is evident when looking at how lucrative some of these deals are. Of course it isn’t just for the huge global events, as sponsoring smaller events is a much more likely option for SME’s. If executed effectively, digital sponsorships still provide a way for businesses to efficiently market themselves to a target audience and build on their digital presence in an ever growing market.

References:

Bacon, J. (2018). How sport sponsorship is joining the digital age – Marketing Week. [online] Marketing Week. Available at: https://www.marketingweek.com/2015/04/22/how-sport-sponsorship-is-joining-the-digital-age/ [Accessed 2 Jan. 2018].

Bowden, E. (2018). FIFA: Russia World Cup 2018 is struggling to find sponsors. [online] CNNMoney. Available at: http://money.cnn.com/2017/12/01/news/fifa-sponsors-russia-2018/index.html [Accessed 3 Jan. 2018].

Digital sponsorship 2002, , Centaur Communications Limited.

HuffPost. (2018). Risks of Digital Advertising and the Value Provided by “People-Based” Measurement. [online] Available at: https://www.huffingtonpost.com/entry/risks-of-digital-advertising-and-the-value-provided_us_5935cef3e4b033940169cd2d [Accessed 3 Jan. 2018].

Kinmont, S. (2018). Is sports sponsorship still worth the risk?. [online] Available at: http://www.thedrum.com/opinion/2016/03/16/sports-sponsorship-still-worth-risk [Accessed 2 Jan. 2018].

Madill J. (2018). Driving Fan Engagement. [online] Available at: https://medium.com/@jonnymadill89/driving-fan-engagement-in-the-digital-age-what-digital-disruption-really-means-for-sport-e4444f595a61 [Accessed 3 Jan. 2018].

Thomson, M. (2018). Digital Sponsorship Benefits. [online] Available at: https://www.linkedin.com/pulse/digital-sponsorship-benefits-how-manage-increasing-mark-thompson [Accessed 2 Jan. 2018].

Digital marketing is simply defined as the application of digital technologies and media in order to achieve marketing objectives (Chaffey, 2015). In the modern age, it is key for businesses to make their online presence count due to how influential the internet is on consumers. The use of online partnerships is a very popular, and successful method of digital marketing as it allows businesses to market themselves whilst building a working relationship with other likeminded businesses. With online markets becoming more congested every day, is cooperation really the way forward?

So what are the benefits of utilising an online partnership for a small/medium organisation? They represent an opportunity to collaborate with other like minded businesses in order to achieve a mutual goal. Whether that goal is to create value\profit or gain more users for a service. Ryan (2014), explains how strategic online partnerships are seen as deals which has an outcome which benefits all parties involved.

Listed below are examples of some very successful online partnerships, varying from advertising in computer games to co-branding with other companies.

• An example of where the use of online partnerships have been effective is Uber’s integration with Citymapper. Citymapper, being the most popular commuting app, partnered with Uber to allow commuters to plan their routes whilst having the in-app option to request an uber to fulfill their commute. The strategy behind these types of partnership, is the sharing of resources which in this case would be the client base. By allowing Uber to feature on the app, Citymapper are taking a small commission fee for every ride requested on the app, whereas Uber are gaining access to the large consumer base which use the Citymapper app. Lomas (2017), states that the integration was a seamless success for both parties and that Citymapper has recently partnered with London Black Cab app Gett.

• Another method of marketing collaboratively is the affiliation between ClassicFootballShirts and Football Manager. With FM being one of the most played PC games over the last two decades, a sponsorship deal for ClassicFootballShirts, the largest online store for football garments, was likely to be beneficial for both parties. With FM actually advertising ClassicFootballShirts in game, it is being seen by hundreds of thousands of players worldwide. With just a click of the advert, it directs you straight to the sports retailers website. On the other hand, the release of the game was extensively covered by the ClassicFootballShirts marketing team. Patel (2017), describes how affiliate marketing is likely to be a commission based incentive for the parties involved, so like Citymapper, FM are likely to be making a ‘per click’ commission for their advertising efforts.

• Co-branding is another way that businesses can work together in order to create value. Jackson (2017), explains that co-branding is a strategic partnership which aims to recognise the value of synergising each other’s reputation in order to create awareness about a product or service. Uber and Spotify have teamed up in order to allow Uber users to create a soundtrack for their journey. This partnership synergises the two differing companies together, in order to improve the users experience. This aims for both companies undertaking this collaborative effort run parallel as it can be simply defined as a strategy to create more users.

For a small/medium size organisation, the use of digital marketing can be a very efficient method of amplifying awareness of a product/service. The methods presented in this report are some of ways in which businesses can benefit from an online partnership. With successful online partnerships being a beneficiary to all parties, it is certainly a productive way to build a digital presence.

References:

• Bernazzani, S. (2017). 10 Examples of Successful Co-Branding Partnerships (And Why They’re So Great). [online] Blog.hubspot.com. Available at: https://blog.hubspot.com/marketing/best-cobranding-partnerships [Accessed 26 Nov. 2017].
• Chaffey, D. & Ellis-Chadwick, F. 2015, Digital marketing, Sixth edn, Pearson, Upper Saddle River.
• Chaffey, D. & Dawsonera 2009, E-business and e-commerce management: strategy, implementation and practice, 4th edn, Financial Times Prentice Hall, Harlow.
• Jackson, C. (2017). How Co-branding Can Make Two Reputations Better than One | Trackur. [online] Available at: http://www.trackur.com/cobranding-branding-reputation [Accessed 25 Nov. 2017].
• Lomas, N. (2017). Citymapper ties with Gett to launch shared taxi commuter route in London. [online] TechCrunch. Available at: https://techcrunch.com/2017/09/21/citymapper-ties-with-gett-to-launch-shared-taxi-commuter-route-in-london/ [Accessed 27 Nov. 2017].
• Panico, C. (2017). Strategic interaction in alliances.
• Patel, D. (2017). Affiliate Marketing Made Simple: A Step-by-Step Guide. [online] Available at: https://neilpatel.com/what-is-affiliate-marketing/ [Accessed 25 Nov. 2017].

How is a global brand like IKEA going to utilise social media?

Swedish manufacturing giant Ikea, is the worlds largest retailer of furniture and has held that title since 2008. With 365 IKEA superstores reaching 45 countries, IKEA have been recently aiming to increase their efficiency when it comes to listening and monitoring to their customers and also to easily liaise with their partner stores overseas.

The business had an understanding of the use of social media, but it seemed this use didn’t always translate from different regions. Due to this, they wanted to establish a social media presence in which can connect their stores, so they could work more cooperatively and collaboratively with them, as they understood that they would be able to collect and share useful data and insights, which they could utilise to benefit the business as a whole.

With the aim of developing a socially intelligent system to link the business’ together, along with the customers, IKEA worked with The Socializers to establish a ‘broader cultural shift around sharing and governance’ (Brandwatch, 2017). In order to spot and analyse data from around the organisation, they built and developed a platform, named ‘The Listening Hub’, in which they could digitally filter data which is useful to them. In essence they built a social media platform, so they can understand more about how the brand is perceived globally. by using this platform, they were able to gain insights into customer perceptions of the brand.

Cohn (2015) implies that the use and understanding of social media in the present day can be critical for growth and development, and this translates to IKEA’s case as Brandwatch Vizia found how the customer service platform differs depending on region. For a global business such as IKEA, this is critical to know as its key for them to get a clear understanding of where their customers are relaying their customer service feedback, so they can act upon it and look to develop more social relations with their customers.

In conclusion, it is encouraging to see global corporations such as IKEA understanding the importance and impact that social/digital marketing can have on their business operations. It highlights the presence which a social profile can have in relation to their development/growth.

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