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Let battle commence: American sports are set for a lucrative betting sponsorship land grab

That sound you heard on Monday was the popping of champagne corks as the US Supreme Court ruled to strike down the law that made sports betting illegal in the US outside the state of Nevada.Technically, the ruling doesn’t legalise sports betting in itself but it does allow each state to legalise it if they so wish.

Not surprisingly, most states so wish.

New Jersey brought the case to the Supreme Court in the first place so you will be able to place a bet there within a couple of weeks. Four other states passed pre-emptive legislation legalising sports betting in anticipation of this ruling, while a further 14 have already introduced bills to their legislature. Within a year or two, this will be a tidal wave that will cover the whole country — with the probable exception of Utah and Hawaii.

However, those champagne bottles weren’t being opened to celebrate any sense of justice being done. This was all about the money. Frankly, other than the illegal, underground bookmakers who are currently feeding the (significant) gambling habit of Americans, it is hard to think of anyone who won’t benefit from an enormous commercial windfall.

First and foremost, the individual states are now able to collect tax on the profits of an industry that some people estimate to be worth at least $400bn (£296.4bn) per year.

Bookmakers are the next obvious beneficiaries with over £1.5bn added to the market values of British betting firms immediately after the ruling was made public. Shares in Paddy Power Betfair soared by over 12 per cent. Meanwhile companies like DraftKings and Fan Duel, who currently navigate a loophole in the legislation with their daily fantasy propositions, already have an active database of 10m people who like to stake money on sports predictions.

The major sports leagues and their teams are chilling their champagne flutes as well. Ironically, they were fighting against the ruling, arguing instead for a Federal solution rather than a state-by-state one. But that technicality notwithstanding, Mark Cuban, the outspoken owner of the Dallas Mavericks NBA team has gone on record saying that this ruling will double the franchise value of all teams in the major US sports leagues.

Even if the - frankly preposterous - one per cent “integrity fee” that the leagues are proposing doesn’t come to pass, there are multiple ways that the leagues and teams will benefit commercially. People are significantly more likely to watch more minutes of more games when they have money on it, so that increased viewership will be reflected in the rights fees. Sports data will become the oil in the engine of the industry so expect to see significantly more deals like US Soccer’s $1.5bn deal with STATSports and Sportradar’s exclusive deal with the NFL.

Even more significantly, the ruling has also opened up a gigantic new sponsorship category. Gambling companies now account for a staggering 45 per cent of Premier League shirt sponsorships and completely dominate the commercial breaks as they compete to be front of mind in the “moment of truth” when the bet is placed. That is worth a lot of money to betting companies and they have shown a willingness to pay for it. Let the land grab commence.

But the biggest winner of all will be those responsible gamblers around the country, who no longer have to go underground to unregulated, dark markets. They will now have access to transparent odds, payouts on their winning bets will be guaranteed and there will be a route to legal recourse if necessary. Contrary to some who argue that an explosion of betting might lead to more corruption, almost all evidence suggests that this increased transparency will decrease the opportunity to manipulate the markets as irregular betting patterns become easier to identify.

Of course, there is a long way to go and there are likely to be plenty of bumps in the road before this all plays out. But the genie is out of the bottle and sports marketing in the US will never be the same again.

That’s something you can bet your mortgage on.

Synergy expands to U.S.

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NEW YORK – November 2, 2015Engine Group, the global marketing services network, today announced the U.S. launch of Synergy, its award-winning sports marketing and sponsorship agency. Based out of Engine Group’s New York office, Synergy U.S. will be led by Dominic Curran, who has been named CEO. Curran, the former Global Sport Director for Bacardi, will report to Rick Eiserman, North American CEO at Engine Group.

Synergy’s U.S. offering will adopt the brand-facing model integrating strategy, creative, digital, experiential marketing and public relations that has made it a leading sports sponsorship agency in the U.K. Headed by CEO Tim Crow, Synergy works worldwide with clients including BMW, Coca-Cola, Emirates and MasterCard on global marquee sporting events such as the FIFA World Cup, the Olympic Games, and the Rugby World Cup. Standard Life Investments, Worldwide Partner of the Ryder Cup, will be on board as a launch client of the new U.S. office.

“The agency landscape around sports marketing is ripe for disruption in the U.S. and Dominic is the perfect person to lead that charge,” said Eiserman. “Brands are frustrated by the lack of media neutrality in the U.S. and the obsession with paid media thinking and rights. Synergy’s approach is to create powerful campaign ideas that have ability to play out across all media, with digital at the core."

Crow added: “A big part of our success stems from the fact that we are neutral brand-facing specialists and guarantee our clients no conflicts of interest – we create strategies, partnerships and campaigns solely for brands. That’s always been core to our offering and we’ll be replicating that model for brands in the U.S.”

Synergy’s move to the U.S. marks the first time the agency has opened an office outside the U.K. Since its inception more than 30 years ago, Synergy has won some of the industry’s most prestigious awards, including recently being named Agency of the Year at the Sport Industry Awards in London.

“I am thrilled to bring Synergy’s differentiated model to U.S. marketplace,” said Curran. “We’ll be diving right in, helping Standard Life Investments activate at the Ryder Cup next year. I’m looking forward to building an agency with the right expertise and creativity for brands and fans in the connected era.”

Engine Group recently announced the U.S. launch of customer engagement agency Partners Andrews Aldridge in September, and the expansion of digitally-led agency Deep Focus to London and Los Angeles. The network is growing rapidly following its acquisition by Lake Capital in August 2014, with more than 2,000 employees across the U.S., UK and Asia.

ABOUT SYNERGY

Synergy is dedicated to creating the world’s most innovative and effective sponsorships for brands. Founded in 1984, and with offices in London and New York, Synergy works worldwide from strategy to delivery for clients, including BMW, Capital One, Coca-Cola, Emirates, Guinness, MasterCard, Standard Life Investments and more. For more information, visit synergy.global.

ABOUT ENGINE GROUP

Engine Group is a global marketing services network of specialist communication agencies that transforms brands through its unique collaborative culture and business approach. The individual agency brands within the network cover the vast range of marketing services including strategy, digital marketing, social media, advertising, public relations, and content creation and production. With operating hubs in the UK, North America and Asia, the agencies within the network include WCRS, MHP Communications, Trailer Park, ORC International, Partners Andrews Aldridge, Deep Focus, Synergy, Calling Brands, Mischief, Fuel, Transform and Slice. The group’s client portfolio range from top brands such as Unilever, Santander and Kimberly-Clark to all the major entertainment studios including Warner Bros., Disney and 20th Century Fox. More information is available at enginegroup.com.