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Sponsors’ Balancing Act: How High Can the Wire Go?

The sponsorship equation used to be fairly simple. Brands supported teams, athletes, events and other organizations that their consumers and customers were passionate about. Stepping up to become an official sponsor—rather than simply an advertiser or ticket buyer—sent a clear signal about the company’s level of commitment to the property and its fans, with the intention that it would be rewarded in kind with brand loyalty.

The underlying presumption has always been that the interests of all three parties—sponsor, rights owner and fan—were aligned. When the focus is on the playing field that presumption holds, but as numerous recent instances reveal, there often is as much attention paid to business, financial and legal factors—not to mention societal issues impacting sports and entertainment--as there is to the games, athletic performance and fan experience.

And that is often where interests diverge between fans and the caretakers of their favorite pastimes. Club owners in European soccer want to create a Super League and fans revolt. U.S. leagues take steps to support Black Lives Matter and some fans think they went too far while others say they didn’t go far enough. The IOC and the Tokyo 2020 Organizing Committee want to push ahead with the Games this summer while most people in Japan want them canceled or postponed due to COVID-19 concerns.

Caught in the middle are the sponsors, their situation summed up last week by a communications director for worldwide and local Olympic sponsor Toyota. "We are agonizing every day about what should be done,” Jun Nagata said.

While we all hope that the dilemma of how (or if) to stage a global event in the wake of a pandemic is unique, the divide between public opinion and private interests in sports is not.

Ultimately, the big question for brands becomes: Is there a point where the rewards of sponsorship stop outweighing the risk? Or, put another way, are there ways to connect with fans and tap into their passion without becoming enmeshed in the sometimes messy business and political aspects of the sports industrial complex?

The easy answer to both questions is “yes.” But in the first case, that tipping point thankfully will never be reached for the vast majority of brand partnerships where the many benefits are highly unlikely to be eclipsed by a potential negative situation.

But for the partners of sports on the global stage, such as the Olympic Games, FIFA World Cup, European soccer, the NFL, NBA, etc., the second question must be considered seriously.

Is it feasible to invest millions of sponsorship dollars with an organization but then try to keep it at arms’ length when controversy comes, as we saw FIFA partners attempt during the scandals of the last decade? Can media and digital content partnerships outside of official sponsor status deliver the same or better return on brand objectives?

It is quite likely that as more marketers explore those types of questions and delve into the options available to them that some—certainly not all and probably not most—will choose to forgo sponsorship for paths with less potential resistance.

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