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World Cup and Sponsorships

The Rugby World Cup is tipped to be the world’s 3rd biggest sporting event of the year. More than 400,000 fans are expected to visit Japan during the tournament. Reports suggest a significant increase already in participation of rugby for youth teams in Asia. A television audience of 140,000,000 has also been predicted.
Big money is also at stake, with Japan investing heavily in infrastructure from stadia to roads.

As the tournament progresses, some of the world’s leading brands may start to count the cost of the tournament also. Every team at any World Cup, will have a pool of sponsors, and it is common procedure for these agreements to reward teams, and individual players, based on how far they progress. Of course, this make sense – longevity in the tournament means high profile games, and thus more exposure for sponsors. However, unpredictability of sport makes financial planning for such arrangements difficult.

With huge sums involved, deep pockets could be needed – particularly if an underdog progresses much further than expected. Hence, contractual bonus, prize indemnity insurance can be so important to these types of agreements. These help mitigate exposure and add a degree of certainty to planning.
This goes beyond brands with federations themselves often seeking protection also. This is based on the bonus’s players receive depending on their progress. With NatWest key sponsors, for both England cricket and rugby, let’s hope success continues for them on from the astonishing cricket World Cup.

 

Author: Matthew Dewen

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