Matt Maher: A big shakedown coming for sponsorship? You bet!
In a season where positives have been thin on the ground for Albion, this week’s announcement of a new three-year sponsorship deal with Ideal Heating was unquestionably good news.
Not least because it means another three seasons of Boilerman, the mascot whose popularity simply could not have been foreseen when the Baggies first teamed up with Ideal in 2018.
“At this rate, Boilerman will soon be due a testimonial!” quipped one wag on social media, shortly after the new deal had been announced.
Yet while the relationship between Albion and their main sponsor has flourished due to the ability of both parties, when appropriate, not to take themselves too seriously, this remains a serious business decision.
For Albion, in the current financial climate and with relegation to the Championship an increasing certainty, it looks a particularly savvy one.
In the not-too-distant future it may appear shrewder still, due to the prospect football clubs may soon find options for shirt sponsors somewhat reduced.
Premier League clubs will be updated today on a government review into gambling laws.
A white paper from the department for digital, culture, media and sport is due to be published this autumn and while pre-empting Whitehall policy is always dangerous, it seems likely gambling operators will eventually go the same way as alcohol and tobacco in being barred from the shirts of sports teams. That is already the recommendation sent down last year by a House of Lords committee.
“It is definitely another challenge looming for the industry,” says football finance expert Rob Wilson.
“It is certainly not insurmountable. In the same way football recovered from not being able to use alcohol or tobacco sponsorship, they will find different sectors to use.
“But it is a significant issue for clubs to deal with, particularly when you couple it with the pandemic and the fact there are probably fewer companies willing to spend on sponsorship because of the lack of tangible return. What West Brom have done is found an alternative sponsor which also gives them a bit of longevity – three years is no mean feat.”
Gambling sponsorship is estimated to be worth around £110million a year to English football, though recent developments have suggested the industry’s influence on the sport might be starting to wane. No betting company made the final shortlist for Manchester United’s next shirt sponsor, this week announced as the German-based IT firm TeamViewer.
Villa and Everton, meanwhile, recently moved away from betting companies as their principal sponsor, both clubs striking deals with online car retailer Cazoo.
The terms of Villa’s two-year deal with Cazoo, which replaced the previous agreement with online gambling firm W88, are thought to be worth around £12million.
There is also the added bonus of the sponsor’s logo being permitted for use on junior replica shirts, thereby increasing sales.
It would be wrong to claim Villa have entirely turned their back on gambling firms. They still have LT as their official betting partner, in the same way Albion still have an official link-up with Bet365. There remains the sense, however, of recent decisions having been taken with one eye on the likely legislation to come.
“If you look back over the last five years the narrative has changed on gambling and gambling sponsorship,” says Wilson.
“The emergence of smartphone technology and apps where people can easily spend a lot of money – years ago you would have to go to a betting shop to do that.
“I just can’t envisage the government not regulating it more heavily because of the public perception as much as anything else.”
For all that clubs might have started to look elsewhere, the relationship between gambling and football remains lucrative.
Wolves are one of eight Premier League clubs who still have a betting firm on the front of their shirts, their agreement with ManBetX worth £8million during the 2019-20 season, according to the most recent accounts.
Yet without question the biggest impact of tougher laws would be felt in the Football League, itself currently sponsored by SkyBet. EFL chairman Rick Parry recently warned the government of “catastrophic” consequences should gambling sponsorship - thought to be worth around £40million to Championship clubs - be removed immediately.
Moving forward, the debate may be less about if betting firms can remain on shirts and more how and when new guidelines are implemented, in a sport where the full financial implications of the pandemic are yet to be realised.
“It is going to be a huge issue,” says Wilson. “What you have got in the Championship right now is a lot of clubs who are really struggling.
“The lifeline is the sponsorship with the EFL or shirt sponsorship. You are basically going to legislate against that being allowed, which means you are going to get a huge amount of clubs in the same market for replacing that sponsorship and lost revenue. You also have to consider the size of the gambling market has increased significantly. We shouldn’t underestimate the amount of money that generates for the government.
“If sport is part of how they generate that revenue, there is a lot of water to go under his particular bridge.”
