Thabani Khumalo. Photo: Supplied Thabani Khumalo. Photo: Supplied
JOHANNESBURG – Sports marketing is about much more than just exchange of money, but sound business partnerships, mutual commercial benefits, sports development, and broadcasting and media rights. It is also about developing an environment that priorities understanding of stakeholders’ needs, challenges and expectations, and thus developing appropriate offerings and services in response.
Over the last two decades broadcasting rights have proven to be a critical commodity within the sports industry. As media organizations shell out billions for broadcasting rights with sports associations, leagues and clubs, their marketers are demanding more value for their money.
The power is beginning to shift from what the rights holders (sports associations, leagues and clubs) want to sell to what the broadcasters need to buy. It is now all about negotiating the best package with strong and clear agreements, whether from the broadcasters’ perspectives or the relevant sports entity, that reflect co-dependence and mutual benefits between rights holders and the rights buyers. This is an important lesson that the SABC and SAFA would do well to learn and embrace if they want to consolidate their partnership, grow football, manage football fans as customers and access the previously untapped sports markets.
SABC and SAFA must understand that sports marketing is about much more than just money. It is about developing a strategic business partnership that generates mutual commercial benefits. SAFA should avoid over commercialising its product but rather, together with the SABC build solid business opportunities from which both reach their marketing and business targets and ultimately benefit.
The ongoing disagreement between the SABC and SAFA over broadcasting rights is unnecessary and reflects a lack of understanding of their responsibilities, challenges and opportunities. For SAFA, the sale of broadcasting rights is the biggest source of revenue, generating capital needed to finance its mandate which includes the development of football at grassroots level.
The SAFA’s decision not to allow the SABC to broadcast the match between Bafana Bafana and Sychelles alienated millions of football enthusiasts – the majority of them reached through the SABC’s radio stations. The decision was an indication that SAFA has become so reliant on broadcasting money that its administrators seem to have completely lost sight of the importance of supporters. It is fans’ addiction to football that the SAFA brand appeals to sponsors and generates financial benefits.
It was unfortunate that that broadcasting disagreement came at a time when SAFA is struggling to attract spectators to their games. Our football is slowly turning a mass followed sport without spectators, and now without viewers or listeners. Wide coverage through SABC Television and Radio Stations, for instance results in significant exposure for SAFA. Such exposure could deliver huge benefits to SAFA in terms of increased revenue from sponsorships and attract new supporters from beyond its current catchment.
The royalties that the SABC earns from selling footage to other media outlets and from advertisement revenue enable it to invest in the costly organisational and technical infrastructure involved in broadcasting games to millions of fans. The various big sporting codes have seen the values of their sporting rights soaring at alarming rates. Internet now commands a huge influence on sports broadcasts living traditional media broadcasts with a challenge to develop a new game plan when it comes to negotiating broadcasting agreements.
South African football commands a huge segment of the sports market and has a huge potential to grow over a long period. The best business strategy for SABC and SAFA’s growth is always to try to retain existing football customers while trying to break into the untapped sports market. By failing to reach an agreement, SABC and SAFA were big losers.
Thabani Khumalo is Marketing Specialist @ Think Tank MarketingServices and former Boxing SA Board Member.
The views and expressions are not necessarily that of Independent Media.