How COVID-19 could affect gambling sponsorships of football clubs
Gambling sponsorships are one of the most vulnerable ways to finance sports teams. Learn more about how sponsorship worked in the sports industry during the Covid era.
Introduction
Sports sponsorship is estimated to be worth between $50 billion and $60 billion. The cancellations of events, seasons, or even whole seasons have caused havoc in the industry. Sports Business Journal estimated that 5,300 events were cancelled in the first month of the shutdown, which affected 51 million fans and cost $3.4 billion.
COVID-19 continues its destruction of the global economy. Premier League clubs are becoming more concerned about the long-term consequences. Sports event sponsorship is a significant problem in the EPL. Shirt sponsors are threatening to cut back on payments or end all deals because of the current shortage of football. Gambling sponsors have voiced concerns about the lack of movement in English football.
Many punters are turning to online casinos to get their thrills, as there is no legalised sports gambling. In this article, we will discuss how Covid-19 might affect gambling sponsorships of football clubs.
Why Gambling Sponsorships Matter For Premiere League
Sponsorships are becoming more critical in the modern era for Premier League clubs. Many football clubs are now more dependent on sponsorship income than ever, from shirt sponsors to sleeves sponsors.
Gambling sponsors worry that their sponsorship deals aren't delivering value due to the lack of football activity. The popularity of online casinos is becoming more popular with those who enjoy betting on sports. For this reason, there are many bettors who search for the best payout online casino to get as many benefits from betting as possible. Online gambling can be exciting, but it can also be confusing. Review sites can assist players in choosing the right casino as there are several online casinos in the industry. Those sites allow players to get appropriate information about how online casinos work and operate in the industry.
Both gambling sponsors and the clubs they sponsor are facing a significant problem: the insufficient money available to the global betting and sports markets. This could lead to a reduction or complete stoppage of sponsorship payments by gambling companies to clubs, impacting the club's spending power and negatively affecting its performance. Sponsorships can bring in millions of dollars each year for teams. If they don't, it could lead to teams not paying their staff. This could result in fines or even liquidation.
NFL And NBA Sponsorships In Covid-19 World
According to IEG, a sponsorship consultancy, the revenue from sponsorship for the National Football League (NFL) and its 32 teams soared to US$1.62 billion during the 2020/21 season.
The pandemic resulted in brands being unable to do on-site activations. However, revenue for the NFL still grew ten per cent compared to the 2019/20 season. This was due to a significant boost from gambling, which saw the league's income increase to US$1.47billion.
IEG stated that increases in NFL sponsorship revenue are typically between four and six per cent annually. However, they noted that new spending for 2020/21 was driven by the naming rights agreements for the Allegiant stadium and SoFi stadiums.
These deals helped the Las Vegas Raiders and Los Angeles Rams to be in the top half for NFL sponsorship revenue. However, growth for the league's 29 other franchises was steady at 2%. According to the study, new league-level sponsorship opportunities were also critical contributors to revenue growth. New partnerships with Subway, Trust, and Invisalign were just a few of the deals.
Gambling played a significant role in the signing of 23 new gaming and lottery deals, which increased revenue by almost 25% compared to last. BetMGM signed six new partnership agreements, while Monkey Knife Fight and PointsBet, Caesars, DraftKings, and Caesars all signed at minimum two new sponsorship agreements.
The pandemic had an impact on ridesharing, with Lyft and Uber dumping nine combined deals with NFL teams. This was likely due to the low number of fans travelling to and from the games. For a Zoom party, the Los Angeles Dodgers attracted 11,000 people. Other teams have followed their lead. Although replays of classic games from both leagues have attracted decent viewership, they do not attract the same level of attention as live games.
Rebroadcasts of high-scoring games late in the season of Night Football averaged around 500,000 viewers, compared with the nearly 17 million viewers who watched the live game. Compare that to the live, original programming for the 2020 NFL Draft, which attracted over 15 million viewers on its first day. To offer value-added brand opportunities, the NFL teams have worked with sponsors. The Denver Broncos used Drizly, an alcohol delivery app, to deliver sponsor products to U.S. Bank clients. This was just before the Zoom happy hour.
The media channels that are most effective in reaching and engaging the lost fan base due to cancelled games or games without fans are the best ways for teams and sponsors to work together.
Conclusion
Sports sponsorships are a major revenue stream. They contribute 20% to the bottom line of most teams and leagues. The pandemic will make it challenging to maintain a sponsorship relationship as companies cannot take advantage of the opportunities offered by live sports. Travel (airlines and cruises), hotels, destination advertising, autos, restaurants, and auto parts are some of the most vulnerable industries for sponsorship after gambling. Beer, tech companies, and fitness and health brands are some of the best-performing businesses that could be more involved.
