Sponsorship deals in Ireland almost halve due to Covid-19

Sponsorship deals in Ireland almost halve due to Covid-19

Ireland against England in the Six Nations rugby tournament earlier this year. The competition was postponed due to the Covid-19 restrictions. Picture: Ramsey Cardy/Sportsfile

New sponsorship deals in Ireland dropped 46% in the first half of 2020 versus the same period last year.

The restriction on sports and entertainment events along with a reduction in revenues due to global lockdown resulted in many companies cancelling or delaying sponsorships.

According to research in the Onside Quarterly Sponsorship Review, the months of April and May were most impacted with sponsorship deals reported down 86%. However early signs of a recovery began in June with new campaigns such as the RTÉ Does Comic Relief supported by sponsors including Bank of Ireland, JustEat and TK Maxx.

Despite this the report notes that the sponsorship rights industry is at risk of shrinking in value by more than 10% this year, depending on how the return to sport and entertainment plays out.

Despite overall declines, sport continues to command a lion’s share of the reduced sponsorship activity in Ireland, with eight in 10 deals so far in 2020 played out in the sports space. 

Onside CEO John Trainor said 2020 opened strong in terms of high-profile major renewal deals including Aldi and PwC’s multi-year extension of their Irish Rugby sponsorships, Allianz’s sponsorship renewal of GAA Leagues, and a steady stream of sponsorships in horse-racing by major sponsors including Paddy Power and Dubai Duty Free. 

"However, since March, sponsorship industry deal doing has switched to adjusting existing arrangements between top sponsors and rights holders to account for the impact of Covid-19 on current deals, rather than any significant volumes of new deals," he said.

The research said rugby sponsors experienced a particularly marked impact from the lockdown as landmark events like the Guinness 6 Nations and club tournaments were put on pause through what is typically peak season for the sport.

"Rights holders will need to look for new business elsewhere as traditional sponsorship sectors such as auto, airlines and apparel take time to recover from the impact on their businesses. Sports and entertainment rights owners should follow the money where consumer spending is rising, such as logistics and online delivery services, home technology and personal grooming products."

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