Faster, higher, stronger—the challenge of sports sponsorships

We recently asked Craig Giles, associate at leading sports law firm Bird & Bird, 'what complications arise when sponsors seek to develop a campaign in the sports sector?'

And then this happened:

https://twitter.com/FBI/status/603524052888756225

And this:

https://twitter.com/fifamedia/status/605779809050857474

Did nervous sponsors contribute towards Mr Blatter's decision?

At the moment, we don't know.

https://twitter.com/VisaNews/status/605824504875511809

Whatever the reason, the ESA makes a valid point:

https://twitter.com/EuropSponsAssoc/status/606059374998646784

So what do you need to know if you are advising a client which is looking to enter into a sponsorship arrangement? Things, as we have seen, can go from 'fantastic' to 'challenging' very quickly indeed.

Craig Giles explores some of the important challenges that face sports sponsors below.

How does sports sponsorship differ from other forms of sponsorship?

What distinguishes sports sponsorship from other types of sponsorship is the wide-range of opportunities available. You can decide to sponsor:

• a team
• an event, championship or league
• a venue or arena
• an individual
• sporting content, such as a television programme

Each type of sponsorship carries its own potential risks and rewards.

Ultimately, a sponsor will need to decide which property is the best fit with the sponsor’s brand, and offers the greatest exposure in the territories and to the demographics that the sponsor wishes to target.

What are the key issues for rights holders?

Before commencing the sale of any sponsorship packages, a rights holder should undertake a rights assembly exercise to identify the rights that it has available to offer.

The rights holder will also need to consider whether it needs to take any steps to protect those rights or to acquire additional ones from third parties—for example, by obtaining rights to use player imagery, or purchasing advertising inventory around a stadium.

The rights holder will then need to consider how best to structure its sponsorship programme in order to secure its desired goals. It is common for rights holders to operate a hierarchy of sponsors—with those at the higher tiers, such as the title sponsor of a league, being offered a greater range of rights than those at the lower tiers.

It is also common for rights holders to require some of their sponsors to provide goods or services as ‘value in kind’ as part of the overall consideration under the sponsorship agreement. This can help the rights holder by enabling i