Sponsorship market reviving
Big names splash out to support sports and other activities to build brands
published : 1 Mar 2019 at 04:00
newspaper section: Business
Last year was a robust one for the sponsorship market in Thailand, with 19% growth from the year before to US$223.4 million, according to Asia Sponsorship News (ASN).
Last year's performance was still below the peak of $247.8 million reached in 2015, which was considered an outlier, as spending was significantly lower in the following two years.
The Top 10 spending brands (see table) include the usual major players, but also some newcomers since ASN last analysed the market in 2016.
These 10 brands contributed almost 30% of the total investment in sponsorship in the country.
In terms of movement within the Top 10, Toyota was fourth in 2016 with spending of $6.8 million, and Chang topped the table at $14.4 million.
AIA was second, but it has fallen out of the Top 10 following the cessation of its Thai Umbrella Football Club partnership with the Football Association of Thailand in 2017.
Carabao and Adidas were newcomers in 2018.
Looking at the broader market dynamics that moved the needle, ASN saw a few noteworthy developments in 2018:
Platforms: Motorsports and multi-sports outperformed with 98% and 103% growth respectively, while platform leaders football ($90 million) and athletics ($32 million) gained a healthy 23% and 15%, respectively.
Categories: Two of the top 10 categories -- petrochemicals and conglomerates -- dipped into their budgets significantly in 2018, with respective increases in spending of 119% and 590%.
Genres: Unsurprisingly, content was the biggest mover with a 114% rise. Events, the perennial genre leader, gained 33% as well.
"The 19% year-on-year increase in sponsorship spending in 2018 is testament to a strong industry," said Paul Poole, founder of a marketing consultancy specialising in commercial sponsorship in Thailand.
"To see big brands and organisations such as AIA, King Power, Sports Authority of Thailand, Honda and Siam Cement Group falling off the list is somewhat of a surprise given their visibility in the marketplace and their sponsorship history.
"However, it is refreshing to see new additions to the list such as Adidas. It speaks of a dynamic and ever-changing market."
Sponsorships have the potential to reach beyond short-term sales to build a brand's identity, said Mr Poole.
"Brand strength contributes 60% to 80% to overall sales, making this benefit critical for sustained, long-term sales growth," he said.
In his view, consistency is the key to building brand awareness and companies such as Toyota and Adidas are good examples of businesses pushing through content on all platforms, especially social media.
"Since brand ambassadors are now typically anyone sharing content -- especially online via video -- brands are getting leverage from the increasing use of social media platforms across the world. And Thailand is one of the most gluttonous consumers of online content," said Mr Poole.
Leading sponsors by value in 2018 (US$ million)
Toyota 11.75Chang 10.35PTT Petroleum 7.37Singha 6.93PTT Group 5.57Tourism Authority of Thailand 5.53Thai Beverage 5.17Adidas 5.07Pepsi 5.06Carabao 4.39
Source: Asia Sponsorship News