Disrupting the sports sponsorship industry thru Gamification

Disrupting the sports sponsorship industry thru Gamification

The sports sponsorship market is a nearly $20 Billion market.

Over the past 30 years sports sponsorships have been sold primarily the same way: sales teams scour the local landscape to identify companies with marketing budgets large enough to justify a six-figure investment.  With no real means of measurement available, these potential sponsors are pitched on the value of having their brand appear alongside that of the team’s brand to create an emotional attachment with fans and consumers.  In today’s world of virtually unlimited leisure-time options, consumer brands have now recognized that simply paying for their logo to appear next to that of a professional sports team, or purchasing television advertising or in-stadium advertising during games no longer provides the same return on investment. Consequentially, the cost of advertising has escalated; competition for advertising space has increased, all in a limited market of potential consumers.  Finding ways to stand out is no longer an academic option, but a marketing necessity.

The prices and other terms for these sponsorships rarely contain performance clauses and instead are based on the geographic market size and how well the team is performing (which directly dictates how many fans might be following the team).  In the simplest terms, these sponsorships consist of multi-year contracts providing multiple forms of display advertising.  With the advent of digital marketing, sponsors have gained tools that provide a much broader and deeper connection with the fan, but the revenue generated by teams has not grown proportionately.

So while the potential for fan interaction has increased dramatically for marketers, team revenues have stayed basically the same.  In order to meet an annual increase in revenue, sales teams are tasked with finding new big-ticket advertising clients from  an ever shrinking pool of candidates.   

We believe the reason that sponsorship revenue has remained basically flat compared to the value teams offer the marketer lies in the fact that the business model for monetizing sponsorships hasn’t changed in 30 years. Currently:

1. The fan is treated as prospect to sell instead of a resource to be groomed and harvested. 

2. Team sales departments are looking upmarket for bigger clients with bigger budgets.  The evolution of the sports industry means these bigger ad deals are getting done mainly at the league level – leaving the individual teams fighting for the smaller clients and budgets.  

We foresee the future of sports sponsorship that will depend on creating dynamic and engaging campaigns that allow sponsoring brands to become closely integrated with the team being used as the channel.  Our strategy is to intertwine the team, the fan and the sponsoring brand with interactive online gaming to yield increased benefits to all parties.

We believe the Gamefication of Sports Sponsorships is fundamentally disruptive technology.  As is true of other disruptive technologies we believe the solution to increasing sponsorship revenues lies in expanding the market opportunities by looking downmarket.  Starting with the fan as our focus, we propose to apply technology to team resources that have been underutilized and undervalued.  Our goal is to bring small businesses (that cannot afford a six-figure sponsorship) into sports sponsorships. This market, when aggregated, provides teams a larger source of potential revenue than all the big targets marketers combined.