…Sports sponsorship has emerged as an appealing proposition for fintech firms, allowing them to connect with larger sports communities
THUR. 06 APRIL 2023-theGBJournal | Financial technology, or fintech, refers to new technology that aims to improve and automate the delivery and use of financial services. Fintech assists companies, business owners, and consumers in better managing their financial operations, processes, and lives. It comprises specialized software and algorithms used on computers and smartphones.
The sports industry has seen significant growth in its use of technology. In the aftermath of the COVID-19 pandemic, the world has seen a revolution in its usage of technological solutions. As a result of the pandemic, competitions were postponed or canceled, contracts were terminated, and community interest waned, but it gave a tremendous push to digitalization and the development of sports. It also enabled sports and financial technologies to collaborate and solve problems.
Sports sponsorship deals from financial services and fintech companies have increased significantly over the last three years. According to a new analysis by FXC Intelligence, a financial data company specializing in international payments, payment cards, cryptocurrency, and e-commerce industries, payments and remittance deals have risen in recent years with some of the world’s biggest names, including those supporting major sporting brands and teams.
FXC Intelligence’s report, due out in December 2022, delves into sports sponsorship deals announced by payment companies in the previous 18 months and outlines emerging trends. During the period, at least 48 deals were signed, including 20 primary sponsorships and 28 payment partnership sponsorships, according to the analysis.
Mastercard has been the biggest spender in the payments industry’s sponsorship market so far, with an estimated spend of more than US$100 million, according to a 2022 GlobalData report. Visa, meanwhile, has the highest number of deals and occupies second place after Mastercard as the biggest spender, with reportedly US$119.7 million across 28 deals in 2022.
Eight of the ten Formula One teams have a cryptocurrency sponsor. Since June 2021, Crypto.com, one of the largest global cryptocurrency exchanges, has been the official sponsor of Formula 1. As a result, the Miami Grand Prix will now be known as the Formula 1 race. As part of a nine-year agreement, Coinbase, FTX, Crypto.com, and other cryptocurrency startups have purchased ad space in the Super Bowl, the country’s largest sporting and television event. Wefox, the world’s first insurtech company, became the first back-of-shirt sponsor of A.C. Milan. Wefox also operates the Wefox Arena in Switzerland, which is home to FC Schaffhausen.
Flutterwave, Africa’s Fintech Unicorn, supported Afrosport TV by sponsoring the AFCON 2021 broadcast and is also a sponsor of the Basketball Africa League (BAL).
According to the GlobalData report, the payment sector accounted for 21% of venue title sponsorship spend across the sports industry in 2022, totaling US$2.24 billion. The amount made the payment industry the most active industry in terms of sports sponsorship spend. According to the report, soccer was the most active sports market for payment sponsorship in 2022, attracting US$819.6 million. The National Basketball Association was the most valuable asset. 614 payment brands were involved in sports sponsorship agreements as of April 2022.
Sports sponsorship has emerged as an appealing proposition for fintech firms, allowing them to connect with larger sports communities while also improving what people think about the brand. Sponsoring high-profile events like the UEFA Champions League, FIFA World Cup, Rugby World Cup, Super Bowl, F1, ATP, and other high-profile events allows fintech companies to reach target audiences, increase brand exposure, and breed trust among these communities. Sponsoring local sports competitions also makes the locals feel like your market is targeted-This article is originally published by Wavysport.
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