Spotify/Barça deal symbolizes a new era of sponsorship?

The very lucrative sponsorship agreement between the music streaming platform Spotify and Barcelona marks, according to experts, the beginning of a “new era”, dominated by the actors of the digital economy.

“Cryptocurrencies, blockchain, NFT, online services, platforms, videoconferencing programs… The actors that are appearing today are mainly companies or brands from the technological or digital sector”, says Pierre-Emmanuel Davin, CEO of Nielsen Sports, a company specializing in sports marketing. “These are the actors who emerge stronger from the pandemic. Their services are increasingly used,” he added.

Spotify, the world’s first streaming platform with over 400 million active users, will put its name on Barça’s jersey and on its legendary Camp Nou stadium for €70 million a year until 2026, according to the Catalan media.

A before and after in the history of Barça, whose motto is, in fact, “More than a club”, and which for a long time tried to resist corporate football betting on its training center and its culture.

But the pandemic, “the growth of an abyssal debt” and the “need of financing for the renovation of the Camp Nou” (…) “accelerated some reflections”, explains Magali du Montcel, general delegate of Sporsora and specialist in economics of the sport.

According to William Miller, professor of sports marketing at the University of Wisconsin-Parkside (USA), “the pandemic has put pressure on sports entities to be more aggressive in their pursuit of all possible sources of revenue, including naming rights.”

For Pierre-Emmanuel Davin, it is “the extension of an underlying trend, which has accelerated with the pandemic”.

Crypto & Co

For William Miller, “we may be witnessing the beginning of this new era” of sports sponsorship, dominated by these newcomers (cryptocurrencies, online services, platforms…).

“But it should be noted that new growth industry sectors tend to be more aggressive buyers of naming rights and other highly visible sports sponsorships,” he added.

This explains the multiplication, since the beginning of the pandemic, of sponsorship contracts from companies specializing in cryptocurrencies.

The platform Crypto.com, which took the name of the former Staples Center, legendary home of two NBA franchises in Los Angeles, adopts one of the most aggressive strategies of influence in the industry, multiplying partnerships with large entities.

The company, already a partner of PSG and which appears, for example, in Formula 1 circuits and in Aston Martin single-seaters, is one of the main sponsors of the Qatar World Cup. In Premier League, 18 out of 20 clubs have signed sponsorships with cryptocurrency platforms this season, such as Socios.com, OKX or learncrypto.com.

These types of sponsors are increasingly numerous on the courts of the NBA or in the stands of Formula 1. This is the case with FTX, sponsor of the Miami Heat stadium and the Mercedes team, Tezos, sponsor of the Manchester United shirt, and the team Red Bull, also sponsored by Bybit, another cryptocurrency platform.

“Globally, cryptocurrency sponsorship investments are projected to be $5 billion by 2026, that is, an 800% increase from today,” explains Pierre-Emmanuel Davin.

“These are companies in search of visibility, notoriety. And they use sponsorship as a tool to make themselves known, to highlight their products and services, especially among fans, who are broad, captive audiences, to create important audiences,” he added.

This type of sponsor, however, must face strong regulation. Often they are not allowed to do direct advertising and choose “loyalty systems, points, tokens”. The aim is to make cryptocurrency “a formative element of the fan experience”, concludes Pierre-Emmanuel Davin.

Translated by Luiz Roberto M. Gonçalves