Football Sponsorship in Forex industry has been a controversial topic among Forex Brokers. Are sport sponsorship deals beneficial for Forex brokers? Let’s find out.
03 July, AtoZForex – Forex industry can be challenging not only for Forex traders but also for Forex brokers. As in any other industry, every broker is fighting for piece of the market share. Every year, many brokers spend thousands, even millions of dollars on various marketing campaigns to stay in the game, and sport sponsorships are becoming more and more popular.
Football Sponsorship in Forex industry
Football Sponsorship is one of the marketing techniques that has become quite popular among Forex brokers in the past couple of years. Many of the firms started to enter sponsorship deals with Football clubs. If you have followed the Premier League, Serie A or La Liga lately, you could notice that many football teams are sponsored by various Forex brokerages. Some being shirt sponsors, some being just one of many sponsors.
In addition, aside from having annual contracts with Football clubs, Forex brokers also sponsor different sports events each year.
Initially, it was FxPro, who started the trend of the Football Sponsorship in the Forex industry. Back in 2010, AtoZ Forex Approved Forex Broker FXPro was already investing big money in sports sponsorships. They have also just returned as the shirt sponsor of Watford FC.
Forex Industry Football Sponsorship Growth drivers
Why Football clubs, you will ask. Why do Forex brokers sponsor football clubs? The answer for these questions is not too simple. However, there are a number of reasons for the popularity of Football Sponsorship in Forex industry.
Numerous brokerages have their focus specifically on Premier League Football. The Premier League possesses huge potential in terms of global reach. Millions of football fans are closely watching every match, which allows Forex brokers to present their brand to this wide audience.
Many of Forex brokerages that have entered sponsorship deals with some of the Football clubs, enjoy wide international presence.
An effective marketing tool
Moreover, sports sponsorships have proved to be an effective marketing tool. Despite the high cost of sponsorship deals, many well-known retail Forex brokerages still team up with sports teams. They tend to develop the long-term relationship, while many firms renew their contracts every year.
Another reason for the spread of Football Sponsorship in Forex industry is the type of audience these sponsorships reach. Both Forex and sport tend to attract people with risk appetite. Thus, Forex brokers have been signing sponsorship deals with some other sports’ representatives. These include partners involved in sailing, motorsports, polo and even other sports like base jumping and chess.
Any drawbacks of Forex Football Sponsorships?
Yes, definitely. Also, it is still difficult to say with certainty whether Football sponsorships are profitable for most Forex brokers. However, statistics show that more and more Forex firms continue to sponsor sports deals. Let’s have a look at some potential drawbacks of Football Sponsorship in Forex industry.
Customer base shift
As we all know, the biggest part of football fans comprises men. Thus, when a Forex broker enters a sponsorship deal with a particular Football club, it is predominantly aiming at the male audience.
However, some online reports show that there are more and more female traders in the Forex world. Just like this, by focusing solely on the Football sponsorships, Forex firms are missing out on a good percentage of their potential audience.
Another potential drawback is the way how some of the Forex brokers promote their services. I am sure you have heard some of the brokers’ advertisement lines, which praised how exciting and thrilling Forex trading is.
However, in reality, Forex trading is no joke – it is actually a very risky and complex business. While some of the firms present their services to be suitable for everyone, I believe only traders with basic knowledge and experience can enter a real Forex world.
To further investigate the specifics of Football Sponsorship in Forex industry, we reached out to the CEO of the Sports Media Gaming Limited, the agency that have been organizing large sports sponsorships for Forex brokers globally. The CEO of, Sports Media Gaming Limited, Stephen Pearson has answered some of our questions.
Kristina Frunze: How beneficial are Football Sponsorships in Forex industry?
Stephen Pearson: “Since FXPro started the trend for sports sponsorship back in 2010, we have estimated that over $350m has been invested by retail forex and binary companies. 65% of this has been invested in football sponsorship. There are many reasons for these investments.
Put simply, the top leagues in Europe, Premier League, La Liga and SerieA attract billions of viewers around the world.
However, brands are also interested in seeing a return on investment. Sponsoring a football club is not just about the presence on the shirt or around the pitch, the modern day football sponsorship opens up significant opportunities for Forex brokers to drive a return on investment via tangible and intangible means.
A partnership with a football club can include a wide array of measurable assets, including access to the club’s digital and social media platforms, club database, and advertising across all the club assets. Sophisticated research tools are now available to satisfy forex brokers that have traditionally just relied on direct response and digital platforms.”
Kristina Frunze: What about intangible benefits of Football Sponsorships in Forex industry?
Stephen Pearson: “The intangible benefits are significant also. The Forex industry is very new, for some. Thus, they haven’t had the time to establish a credible position in a fast growing and cluttered marketplace. Some of the benefits include the following:
– Aligning their brand to a football club with a hundred years of heritage provides instant credibility.
– Association to world leading rights holder brand values, endorsement of its brand by globally recognized players, consistent sporting success and unique settings in which to conduct business and seminars.
– Being able to then cross utilize player images and club marques in their other forms of direct response advertising create a point of difference to their peers, increases the opportunity for promotional activity and can also significantly enhance staff motivation.
– Football sponsorships have also created a new phenomenon, that of geo-regional marketing.”
Kristina Frunze: Could you please elaborate on geo-regional marketing?
Stephen Pearson: “The drive by sports rights holders and brands to create geo sponsorships has been led by an increasing demand for alignment to global sports properties, the growing regionalization of rights holder assets (via multi-language websites and social media, the touring of clubs overseas, signing of foreign sports stars) and the development of new technologies.
Being able to align with a global sports property on a regional level offers highly targeted marketing with limited wastage and at a fraction of the cost of a global sponsorship.
Forex brokers can now become the “official Asian partner” of a team or the “official LATAM partner”, and rights can be defined accordingly. The growing sophistication of research has been an important driver in this process.
Rights holders now know exactly what fan bases, TV viewership, and digital/social media presence they have in every market around the world. This can be used to sell regional sponsorships by continent or even down to a country level.
Technology also plays an important role, digital replacement technology is now widely used allowing the replacement of advertising boards that fans see in the stadium with digital billboards that fans see on TV – messages can be now changed for Europe, LATAM, Asia, and MENA.”
Kristina Frunze: How modern Football Sponsorship In Forex industry differs from past years’ practices?
Stephen Pearson: “Football sponsorship is also evolving from team sponsorship to brand ambassador deals. There is a growing trend by brokers to opt for a more personal approach by sponsoring an individual. High profile brand ambassadors from teams around the world are now being used by brokers offering a new point of a standout.
One final point to make is that the majority of forex brands have been set up by males around the 30 year age mark. Of course, football is part of their DNA and it’s also prestigious for themselves and their shareholders to be aligned to big international football teams. Who doesn’t want to be hosting their clients in the VIP box at a top European team?”
Kristina Frunze: Could you summarize the pros of Football Sponsorship In Forex industry?
Stephen Pearson: “The pros of football sponsorship are numerous:
- An already proven platform for financial brands. Big financial blue chips continually use football sponsorship to great success – eg Barclays, Santander, Standard Chartered…and much more.
- Compatibility with the target market. The football demographics match the online trader demographics perfectly, predominantly males 20-45 years old. Audiences for football are now so big that the female demographics are adequately catered for. Football transcends sport into entertainment and women’s football is fast taking off. Also, most top teams now have a women’s team that can also be sponsored by the broker.
- It’s one-stop media buy. Sponsoring a top football team offers immediate access to global markets via international television, multi-language websites and social media channels.
- Geo regional deals are offering solutions to brokers that either want a more cost effective sponsorship or wish to focus on key markets.
- China is becoming a market of growing importance. The trend for Chinese ownership of foreign clubs and investment in European players to the Chinese Super League is offering huge benefits to forex partners aligned with such clubs and players.”
Kristina Frunze: How about cons of Football Sponsorship In Forex industry?
Stephen Pearson: “Regarding cons, it’s difficult to find many. I would say that with the large percentage of investment now going into football sponsorship, one can argue that brands need to find alternative options to create more standout and point of difference to their peers.
We see this already happening, brands looking at alternative sports platforms. These include sailing, extreme sports, tennis, and golf. Of course, brand ambassadors that are not just from the sport but also from the film industry.
Football clubs also have an onus to do proper due diligence. We have seen deals signed and collapse shortly afterward because the clubs have not done their homework. In a sector that is fast spending money on sponsorship, there is a tendency for clubs to rush into deals.
However, if clubs are signing rogue Forex companies it can affect their own ability to sign other brands in the same sector in future and tarnishes the industry. Clubs need to have a clear understanding of the regulatory framework and ownership structures before entering long-term agreements.”
Kristina Frunze: What is the future of Football Sponsorship in Forex industry, in your opinion?
Stephen Pearson: “Forex brands need to focus on not only securing the sponsorships but developing well thought out activation plans to maximize a return on investment. Where such high potential cost is concerned, the decision to use football sponsorship needs to form part of the company’s overall marketing strategy.
Country managers should be included in strategic planning to create a coherent cross-border campaign from the get-go. Brands should plan how to best utilize the sponsorship assets as effectively as possible to promote the association in its direct response campaigns and other forms of marketing, be it print or above-the-line.
There are many synergies between the online Forex business and the online sports betting business. Football sponsorship has become a staple platform for the sports betting brands, and it shows no sign of abating. The same can be said for the Forex industry. I expect to see that growth continue and the main leagues continue to attract Forex brands as shirt sponsors or official partners. We will continue to see the increased use of brand ambassadors.
For the vast majority of these companies, it will be their first ever significant investment into marketing and certainly the first ever investment into sports sponsorship. Brands can find the use of an experienced external agency very beneficial to providing the global strategy, assist in negotiating the best commercial terms as well as advising on sponsorship activation.”
About Stephen Pearson and Sports Media Gaming
Stephen Pearson is CEO of Sports Media Gaming Ltd (SMG), a leading international sports marketing agency. He has held Board roles at UEFA Champions League and English Premier League. SMG has brokered many of the sports sponsorship agreements with leading Forex brands.
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