Soccer sponsors worry about paying nothing
PARIS: With dark stadiums, match shirts folded in closets, and most homebound players, football Sponsors have lost all visibility and are becoming increasingly restless.
European clubs are struggling to offer their 'partners' a return on their investments as sport faces coronavirus pandemic .
We are trying to do activities with our players for our sponsors, who are even more demanding since closing. But it is very complicated due to the health crisis, a club marketing manager told AFP.
The stars, the surest way for sponsors to attract an audience, are at home, many of them in their home countries.
Worse yet, there are no games for them. Games on television show the markings on team jerseys or around the field to millions of viewers.
In West Ham, one of the sponsors, the high-risk finance company Basset&Gold, which the club stresses is not related to owner David Gold, has just filed for bankruptcy, blaming the coronavirus crisis.
Many sponsors belong to particularly affected sectors, such as airlines and hotel and restaurant chains.
Some sponsors begin to cancel payments.
It is quite obvious that having no more events, everything has to be suspended, it seems very logical to me. It's a case of force majeure, said Marc Vanhove, the head of the Bistro Regent restaurant chain, which sponsors the Bordeaux shirt. AFP
The Bordeaux-based chain has suspended its contract, which runs until 2023, he said, until we have the dates for the restart.
The French hotel group Accor, the main sponsor of PSG, left open the question of whether it would pay the total amount foreseen in its contract (around 50 million euros, $ 54.7 million, one year), before saying two days after it had complied. your commitments. .
When you're a sponsor, you want visibility, Accor CEO Sebastien Bazin told French radio.
But at the same time, it is in the bad moments that you recognize your friends and those who are there for you.
Sponsors can say overnight we are stopping everything because we are in an emergency situation where we have to cut all superfluous spending, sports economist Jean-Pascal Gayant told AFP.
In the event of a crisis, the first budget line they cut is often communications.
With matches canceled and some broadcasters, especially in France, starting to withhold payments, the club's finances are already strained.
Sponsorship is particularly important for Europe's biggest clubs, Deloitte, the accounting and services firm, said in the 2020 edition of its 'Football Money League' that ranks clubs by revenue.
He said the main source of revenue for his top five clubs (Barcelona, Real Madrid, Manchester United, Bayern Munich and PSG) is commercial and averages 49 percent of total revenue, although that number is inflated by PSG, which reports 57 percent of sponsorship revenue.
Further down the Deloitte table, the proportions change.
For clubs located between 16-20 (Rome, Lyon, West Ham, Everton, and Napoli), 65 percent of revenue comes from streaming.
A market expert, who did not wish to be identified, said the risks of deserting may outweigh the financial costs, especially for companies that are doing well in less affected sectors, such as technology or the food industry. .
You can turn to them and say, 'You can play white knight by investing in sports in these tough times,' said the market expert.
The value of being seen as faithful is reflected in the attitude of the Iberdrola Group, the main sponsor of the first division of Spanish women.
It is now, in this dramatic situation, that the support of sponsors is needed more than ever. It is not withdrawing at times like these, a spokesman for the Spanish electricity supply group told AFP.
Still, industry players estimate a 60 to 70 percent drop in investment and the prospect of several difficult years.
Of course, there is a risk that some companies that wanted to invest will no longer do so, but will do so later, said Bruno Bianzina, director of the sports market agency, a French company.