What does the loss of sport mean for retail?
With last week’s decision to postpone the Summer Olympics in Tokyo, which had been set to start July 24, the world may be without major sporting events until the fall.
The shutdown of sports began on March 11 when the NBA suspended its season after the first of its players tested positive for the coronavirus. On March 12, the NCAA shocked sports fans by canceling the March Madness college basketball tournament after recognizing that even playing to empty arenas was not feasible. Within days, the professional baseball, hockey and soccer leagues, as well as Little League, suspended their seasons. Major golf and tennis tournaments were canceled.
In a blog entry, Matt Powell, SVP, industry advisor, sports, NPD, said he sees a minimal impact at least on sports retailing. Sales of sports licensed products, for instance, will take a near-team hit as teams aren’t playing, but much of those sales may be recaptured should events such as the Major League Baseball playoffs and World Series occur later in the year as planned.
Sports marketing will be impacted by event postponements, but again Mr. Powell sees a minimal short-term blow to sales. “That kind of exposure does not manifest itself directly through consumer behavior. Instead, its value is more of a long-term brand-building tool,” he said.
Even so, major advertisers are scrambling to pivot large chunks of their 2020 ad budgets, sidetracking their primary outreach vehicles due to the cancellations and suspensions, according to the advertising trades.
Seen as one of the last “DVR-proof” platforms in television broadcasting, given its real-time action, the value of sports marketing has increased exponentially in recent years. ESPN has said 96 percent of sporting events are watched live.
Sponsors of the Olympics began planning their marketing creative years in advance, in some cases.
Fred Chasse, senior VP at Analytic Partners, whose specialties include marketing optimization, told Advertising Age, “It’s going to be impossible for advertisers to take that Olympics money and spend it, last minute, to have anywhere near the kind of reach, brand and sales impact that the Olympics buy would deliver for them — especially in an election year.”
- Sneakernomics: The Impact Of Sports Cancellations On The Sports Retail Market – NPD
- Joint Statement From The International Olympic Committee And The Tokyo 2020 Organizing Committee Tokyo Olympics – International Olympic Committee
- Assessing The Brand Fallout From Olympics Delay – Advertising Age
- What coronavirus means for sports marketing – Marketing Dive
- For the sports-entertainment business, coronavirus is taking a huge toll – The Washington Post
- Loss of Live Sports Changes ESPN’s Marketing Plans – The Washington Post
DISCUSSION QUESTIONS: How do you see the loss of league games and major sporting events such as the Olympics affecting retail? What does sports marketing provide to brands that other marketing can’t match?