Sponsors Bet Big on Euro Soccer Series
As the players take to the field during Euro 2008, a larger and perhaps even more cutthroat competition also will be sweeping the tournament. The prize? The attention and spending power of the more than 1 billion fans worldwide expected to tune into the three-week sporting event.
That's the goal for the sponsors of UEFA European Soccer Championship, among them some of the world's top companies—McDonald's (MCD), Coca Cola (KO), and Adidas (ADSG.DE). With the opportunity to reach so many customers, they're using a host of sophisticated techniques to raise awareness and increase revenue for their brands.
The complexity of sports event sponsorship coincides with the changing interests of fans. Long gone are the days when a company could plaster a stadium with banners and sit back while consumers flocked to its products. Now, media-saturated customers barely register such "one-dimensional" product placements, forcing sponsors to seek new, more interactive ways to grab their attention.
At the same time, the stakes are higher than ever because buying into event sponsorship has gotten a lot more expensive. Analysts figure sponsors paid up to $29 million each for rights to Euro 2008—about 40% more than eight years ago—and will likely spend twice that via ancillary events and exposure. That makes executives keen to ensure return on their investment.
A Conversation With Consumers
As a result, Euro 2008 sponsors are embracing more innovative strategies than ever to get their messages across. For many, that includes an Internet presence—either through standalone Web sites or in conjunction with UEFA's heavily trafficked homepage—to offer extra services and promotions to soccer-crazy fans. Other companies are taking a more "analog" approach, providing live experiences at the games or offline promotions to fans across Europe.
No matter the strategy, creating a dialogue with consumers has become the name of the game. "Sponsors are looking for genuine interaction with audiences," says Andy Sutherden, managing director for sports marketing and sponsorship at London media consultant Hill & Knowlton. "Brands are desperately trying to create their own perspective for fans during Euro 2008."
At the same time, analysts say, sponsors must be careful not to act too aggressively. Brand overexposure can be harmful if fans react negatively to commercialization of sporting events. That was a major criticism of the 1996 summer Olympic Games in Atlanta, and it has forced companies to walk a finer line between boosting brand awareness and turning people off.
Connecting With the Buying Habits of the Young
The extra revenue and brand awareness to be gained from Euro 2008 sponsorship far outweigh these risks, though. Paul Meulendijk, head of sponsorship at MasterCard Europe (MA), says the company's link with the previous European championship in Portugal four years ago resulted in triple-digit growth in card activation there after the tournament. While he won't predict the impact of this summer's event, Meulendijk expects Euro 2008 to lift MasterCard's European business. "Sponsorship is a critical component for us. It drives both profitability and recognition of the brand," he says.
McDonald's is also looking for a boost from Euro 2008. The fast food chain has launched an online fantasy soccer league on the UEFA homepage to attract the highly lucrative 18-to-24 age bracket.
The virtual game already has 20% more participants than it had during the last tournament, says Johan Jervoe, McDonald's corporate vice-president for global marketing, and is expected to create more interaction between fans and the company. "If you are not part of the media habit of young people, you won't be there in the future," Jervoe says.
Other companies are following suit. Coca Cola has launched an online soccer trading-card game in conjunction with Italy's Panini that allows fans to collect and swap information about their favorite players. Castrol sponsors a digital performance index for the Euro 2008 teams that gives supporters online access to up-to-date stats and profiles of the tournament's stars.
Using Online and Offline Techniques
Not that high tech is the only weapon in a sponsor's arsenal. Canon (CAJ) is combining its online presence with more traditional techniques, such as providing photo booths for fans throughout host cities and assistance for professional photographers covering the tournament. "There's a trend towards interaction through the Internet, but there's still room for people to associate with brands offline," says James Leipnik, Canon's chief of communications and corporate relations for Europe, the Middle East, and Africa.
Despite their multi-pronged tactics, sponsors find it difficult to quantify the economic impact of supporting events like Euro 2008. Iain Ellwood, head of consulting at Interbrand in London, says it's almost impossible to correlate specific sponsorship deals with extra revenue because the events represent only one element in a company's overall marketing strategy. "The key is to leverage [the deals] into extra brand recognition," he says.
To do that, interacting with fans will be sponsors' top priority. While the soccer teams may grab the headlines over the next three weeks, the economic competition off the field will play a huge role in the financial success of Euro 2008.