This week’s IEG Sponsorship Report brings interesting news of an on-going audit at AB Inbev designed to analyze and evaluate over 300 sponsorship agreements the company currently has with different sports properties throughout the world.
The goal of the audit is to align AB-InBev brands with the new global sponsorship strategy that will be implemented through Q2 and Q3 this year. While not revealed in detail, the sponsorship strategy indicates AB-InBev will shift its approach in many ways, including the following:
- Focus on more activation, but with fewer properties
- Move towards vertical inventory ownership
- Set brand engagement as the main objective
- Develop a more consistent set of evaluation metrics
Payout Perspective:
AB Inbev isn’t cutting its sports marketing and sponsorship spending, so much as it’s revising where and how it allocates that money across its current slew of sports properties. I’d expect that more than a few properties will not be renewed as a result, which begs the question: will the UFC be one of them?
The three-year UFC-Bud Light deal was officially announced in February of 2008, but I don’t think it expires until May or June of 2011. Any decision by AB-InBev to renew will depend on more than a couple of things: 1.) how well the current agreement has achieved its objectives, 2.) 1.) what it sees as the future growth potential of the sport and how that might help it achieve new sponsorship objectives and 3.) the UFC’s asking price (and other contractual requirements, such as guaranteed activation spending) for a renewal.
Honestly, I’m not sure it’s a huge deal for the UFC either way. If AB-InBev renews, it likely means the company is going to commit more resources to activating the UFC sponsorship. It would be great to have the world’s largest sports sponsor promoting the UFC and MMA. However, if the contract is not renewed, there are a host of other potential suitors that could pick up the category (and they would likely do more with it than AB-InBev has in the past).
Question?…Dose having Budwiser as an alochol sponsor help or hinder the ufc credibility and growth into the next 10 years in them being a major sports player like Dana has predicted as opposed to Nike(shoe) Gatorade(beverage) Ford(vehicle)
Also..What are the ideal sponsors the ufc needs to have to become a major sports player int he next ten years?
THe UFC doesn’t “need” to have any sponsors to be a “major sports player” in the next ten years. It’s going to be either way.
While the sponsors help generate extra revenues, the main reason they are coveted by the organization is to extend/expand its reach. The UFC doesn’t need corporate America to even notice them. On PPV, they get their audience and reap the financial rewards without having to pay hompage to major TV companies, or even sponsors if they don’t want to.
The value is in activation, and getting the proper marketing message out to the masses via key partners.