MKTG Insights: We're Not Just a Hockey Country Anymore
As Canadians scramble to fill out their brackets in advance of Thursday's tip-off to the 2014 NCAA Tournament, 27 of their countrymen will be South of the border, preparing to play in this year's edition of March Madness - a historic achievement for Canada Basketball and the development of the game in Canada, and a sign of things to come; a symbol of Canada entering "the Golden age of basketball" as Steve Nash said. From the depth of Canadian talent on NCAA rosters, to the emergence of the Toronto Raptors brand in the Canadian marketplace, to the strong national participatory growth the sport has seen, the brand of basketball has entered into the mainstream consciousness of Canadians and corporate sponsors should be on watch.
Anthony Bennett of the Cleveland Cavaliers made history in 2013 by becoming the first Canadian to get drafted 1st overall in the NBA draft. Andrew Wiggins is a safe bet to be a top-3 pick in 2014. The growth of the game hasn't been a fluke resting on the shoulders of a can't miss prospect though. Rather, the sport's rise can be attributed to the strong leadership of Canada Basketball, the commitment from MLSE and the Raptors, as well as support from corporate sponsors. MKTG examines the evolution of basketball's brand in Canada, the role of sponsorship in developing the game and outlines what corporate sponsors stand to gain by aligning their brand to Canada Basketball in the coming future.
How We Got Here?
2009 represented a transformative year for Canada Basketball as a property and their relationships with sponsors as a property. The landscape for publicly-funded sports in Canada had already been shifting. Individual sports saw increases to funding in a strategy designed to maximize medal counts. A by-product of this landscape change was a $500,000 budget cut from Sport Canada announced in May 2009. As an NSO, Canada Basketball required a diversified approach to revenue generation. Newly appointed CEO Wayne Parrish led the movement to engage the corporate world in finding partners who would provide economic stability to the property and grow the game at the grassroots level.
Current Sponsor Roster
Parrish earned an early win by signing Nike to a 4-year sponsorship deal, transitioning the endemic from supplier to sponsor status. Additonally, the property secured Bell as a jersey sponsor and premier partner. As part of Bell's marketing rights, they received jersey branding that is far from subtle, and even slightly larger than the "CANADA" type on the official jerseys. The asset firmly positions Bell at the heart of the property. The brand has supplemented its long-time support of Canada Basketball through newly announced deals with NBA Canada and the Toronto Raptors. By strategically investing in basketball, Bell has found "own-able" white space in the telecom sponsorship wars. While Rogers has carved out a dominant position in hockey through their 12-year NHL broadcast rights deal among other NHL club sponsorships, Bell has an opportunity to break-though in the absence of a category threat. As the team competes in high-profile international competitions, Bell's content rights will pay dividends. Finally, in June 2013, Canada Basketball rounded out their sponsor roster by adding Blackberry to the fold .
As more NCAA athletes transition to the NBA, and the Men's national team can earn high-profile success in international competition, the NSO is likely attract even more sponsor interest. However, core partners who have built up equity and authenticity with the sport (specifically Nike and Bell) will be perceived as the drivers of Canada Basketball's rise rather than passengers along for the ride. The 2016 Rio Summer Olympics will give Canadians the opportunity to see the likes of Andrew Wiggins facing off against Kevin Durant, or Tyler Ennis of Syracuse going head to head with Chris Paul. Canadian men, in an underdog role on the largest stage is compelling territory for sponsors. Brands will likely come to the table closer to 2016 searching for an opportunistic win. However, the authentic brand will outperform the opportunistic brand in the long-term every time.
Beyond the potential for on-court success at the National team level, as a sport, there are many unique benefits that basketball can offer to corporate sponsors.
What Sponsors Stand To Gain:
1. Sport on the rise: Since 2010, basketball participation has seen a growth rate of 16 percent. Additionally, 29 percent of all households in Canada have a household member who participates in basketball. Just like Steve Nash's MVP years and Vince Carter's rise to stardom with the Raptors helped fuel today's crop of young Canadian talent, the next generation of Canadian NBA players will give birth to a new era of young players. Increased participation, in conjunction with an increased presence of role models in the game will propel the sport in this country.
2. Demographic momentum: Basketball is a truly global game. As new Canadians immigrate to Canada, basketball is a source of familiarity. NBA Canada's Dan MacKenzie: "We are really on the right side of some of the immigration trends happening in Canada. If you look at the countries from which the largest subgroups are coming to Canada from, like China and the Philippines, you see that in those countries, basketball is if not the most popular sport, within the top-two. These people are coming to Canada with a love of the sport and into a market where there is a great infrastructure to play basketball."
3. Low-barriers to entry for participation: As more and more parents debate the risk of sports that allow for greater physical contact or require significant investment in equipment,the accessibility and safety of basketball make it an attractive alternative. Basketball is gender-neutral, affordable due to its minimum equipment requirements, and can be played either alone or in teams. Sponsors who invest will be able to protect, grow, and nurture the participatory base.
4. Opportunity for brand extensions: Today, the Toronto Raptors and Canada Basketball engage in significant co-branded programming. With the Raptors playoff-bound and host to marquee events like the 2016 All-Star Game there will certainly be opportunities for sponsors to benefit from an association with the Raptors, or at the very least, benefit from the increased level of buzz surrounding the sport due to the improvement of the Raptors.
5. A seasonality play: For sponsors who invest heavily in hockey or other winter sports, the summer can represent a window of decreased exposure due to the limited number of mainstream summer sports properties available outside of the MLS and Toronto Blue Jays . With major international competitions held in the summer, sponsors can utilize Canada Basketball to ensure a steady stream of messaging throughout the calendar year.
Brands to Watch:
1. Bank of Montreal: In 2013, BMO became the official F.I. sponsor of the Toronto Raptors, expanding what was previously a soccer-focused sports portfolio. With the resources for increased investment, a category opening within Canada Basketball, and the strategic relevance given the brand's movement to build up equity in basketball, BMO may be a brand to watch in this space.
2. Coca-Cola (Sprite): Sprite has a legacy of incorporating basketball into their narrative. A long-time sponsor of the Slam Dunk Competition, activating in both the US and Canada, Sprite is a youthful brand. Basketball's young, tech-savvy fan-base, and Canada's rising crop of young stars may serve as the impetus for the brand to further invest in the sport.