Research and Markets: Value of New Deals in UK Sports Sponsorship Market Stood at £412m in 2004

June 7, 2005 -- Research and Markets (http://www.researchandmarkets.com/reports/c18584) has announced the addition of Sports Sponsorship Market Report 2005 to their offering.

The value of commercial sponsorship of sports in the UK reached its peak in 2002, with the last 2 years (2003 and 2004) seeing lower spending levels. The value of new deals in the UK sports sponsorship market stood at £412m in 2004. This represents slightly more than is spent by UK companies on arts sponsorship and accounts for only 2% of the total annual UK spend on marketing services and advertising.

Although the market has reached a plateau in terms of value, the average amount spent per new sponsorship deal has increased to more than £761,000 — double the typical value seen in the 1990s. (It should be noted that this applies only to the major types of sponsorship and not to the numerous local sport or grass-roots deals.) Accordingly, the volume of major new deals is falling. According to specialist researcher, Ipsos UK, there were only 541 deals in 2004, compared with 1,172 in 1999.

One reason for this trend is that larger sponsoring companies are dominating the market. They tend to spend more per sponsorship and therefore drive out smaller companies. However, the major sponsors are having to bargain harder to gain privileges in return for their money. This has resulted in an increasing number of title sponsorships of events (such as the npower Test Series and the John Smith's Grand National), stadiums (such as the Reebok Stadium and Walkers Stadium) and even football clubs (such as TNS [Total Network Solutions] FC).

Football — with its dominance in terms of spectating figures and media coverage — is still the most popular sport among sponsoring companies. Other team sports are also heavily sponsored, particularly the national cricket and rugby teams. Other sports with a less `macho' image, such as horseracing, tennis, athletics or snooker, tend to appeal to particular companies with a specific target audience.

Sports sponsorship is employed by a wide range of companies, but it is particularly, and increasingly, favoured by the financial services sector in an attempt to enhance what could otherwise be seen as a dull image in the eye of the consumer.

As a result of the proliferation of alternative investments available in the marketing arena, the immediate future does not look positive for sports sponsorship. However, it is predicted that the current slide will soon draw to a close. There is potential for companies to support more amateur, grass-roots sports participation, with the favourable associations with fitness and anti-obesity campaigns that this brings. Nevertheless, major sporting events — such as the World Cup and `Euro' football tournaments, golf's Ryder Cup, Wimbledon tennis, major horse races such as the Grand National, and the Olympics — will continue to attract plenty of sponsors.

For more information visit http://www.researchandmarkets.com/reports/c18584

Laura Wood
Senior Manager
Research and Markets
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