Supermarkets come out on top for sponsorships
SuperValu, Tesco, Aldi and Lidl made up the top four of more than 35 sponsors seen by the Irish public to stand out during the Covid-19 crisis, new research by Onside reveals
28 July 2020 | 0
The number of new reported sponsorship deals in Ireland dropped 46% in the first half of 2020 versus the same period last year, while supermarkets dominated the public’s vote for stand-out sponsors in the past quarter, according to new research by sponsorship consultants Onside.
Despite overall declines, the latest Onside Quarterly Sponsorship Review has revealed that sport continues to command a lion’s share of the reduced sponsorship activity in Ireland, with eight in 10 deals so far in 2020 played out in the sports space.
Sponsorship deals reported were down 86% across April and May, with early seeds of a recovery beginning in June with new campaigns such as the RTE Does Comic Relief supported by sponsors including Bank of Ireland, JustEat and TK Maxx.
“2020 opened strong in terms of high-profile major renewal deals including Aldi and PwC’s multi-year extension of their Irish Rugby sponsorships, Allianz’s sponsorship renewal of GAA Leagues, and a steady stream of sponsorships in horse-racing by major sponsors including Paddy Power and Dubai Duty Free,” said John Trainor, founder and CEO of Onside.
“However, since March, sponsorship industry deal doing has switched to adjusting existing arrangements between top sponsors and rights holders to account for the impact of Covid-19 on current deals, rather than any significant volumes of new deals,” Trainor said.
SuperValu, Tesco, Aldi and Lidl made up the top four of more than 35 sponsors seen by the Irish public to stand out during the Covid-19 crisis by using sponsorship to help communities in the past three months, with three in 10 of the public singling out these sponsors for special recognition.
“In highly competitive spaces like retail, an edge has been achieved by these four supermarket brands over others in the market,” Trainor said.
Overall however, mirroring the sharp decline in activity and spend in the sponsorship arena, the latest wave of Onside research of the Irish public saw a 12% drop in recall of sports sponsors that appealed most to them in the second quarter of 2020, with supermarkets proving the one sector that collectively grew in sponsorship appeal performance. Rugby sponsors experienced a particularly marked impact from the lockdown in quarter 2 as landmark events like the Guinness 6 Nations and club tournaments were put on pause through what is typically peak season for the sport.
Looking ahead to the second half of the sponsorship year and beyond, Trainor said: “The sponsorship rights industry is at risk of shrinking in value by more than 10% this year if there is enduring damage from the pandemic through autumn and winter months, with some sponsors seeking relief or opting out of deals.
“Rights holders will need to look for new business elsewhere as traditional sponsorship sectors such as auto, airlines and apparel take time to recover from the impact on their businesses,” he said.
“As we gear up for a huge year of sport in 2021, with hopefully the return of mega-events like the Olympics, the Euros and the Ryder Cup, pivoting fan engagement in new ways around the live event will be the name of the game,” Trainor added.
“Private equity investors and tech firms turbo boosting digital transformation in the sports and entertainment landscape will also be interesting to watch playing out.”