What are some of the challenges and opportunities of sports marketing in emerging markets?

Cultural diversity presents challenges in sports marketing due to varying norms, values, and preferences across different demographics. It requires nuanced understanding to avoid cultural misinterpretations or offensive messaging. Yet, there are opportunities for growth due to expanding consumer markets, untapped sponsorship potential, and the ability to pioneer innovative approaches tailored to local contexts. Understanding and navigating these dynamics are crucial for success in emerging markets.

Hablando desde la óptica del atleta, existe un reto, pero también una fuerte oportunidad de crecimiento en mercados externos debido a lo sencillo de hoy en día que es conectar con nuevas comunidades, como es el caso del Alexis Jandard que tras su caída en la apertura de la alberca olímpica en París, aumentó su público, o bien, la fuerte aceptación que tienen los luchadores de lucha libre méxicanos en Japón al momento de ir a luchar, creo que la diversidad es un reto, pero también unq fuerte oportunidad.

Cultural factors significantly influence consumer behavior and brand preferences. The research shows that 76% of consumers in emerging markets consider local cultural values when making purchasing decisions. Nike's successful adaptation in China illustrates this point. Their "Commit to Victory" campaign, featuring local basketball stars and Chinese cultural elements, helped Nike become a top sportswear brand in China with a 22% market share in 2022. Conversely, the NFL struggled to expand in China due to American football's lack of cultural relevance, emphasizing the need to understand local sports preferences.

Product adaptation to local culture is the #1 challenge for global brands who have a centralized product development cycle. Due to cultural bias and exceptions, it's required to have both a global AND a local approach with local consumer insights in order to avoid cultural clash !

Businesses must navigate regulatory environments that may be constantly changing or poorly defined in some emerging markets. For example, advertising of alcoholic beverages or sports betting may be subject to strict restrictions. A thorough understanding of these frameworks can prevent costly mistakes and protect brand reputation. Ferrari has demonstrated an astute adaptation to strict regulations in Saudi Arabia, where alcohol advertising is banned. At the 2024 Jeddah GP, the Scuderia replaced the logo of its usual sponsor, Peroni, a beer brand, with the word "Tifosi" their fandom name. This initiative illustrated how a brand can respect local laws while engaging its community, strengthening its brand image in a creative & respectful way.

Legal and regulatory challenges in emerging markets impact sports marketing. Weak enforcement of intellectual property rights (IPR) leads to increased counterfeiting, as seen with the NFL in China. Navigating complex regulations, such as fantasy sports bans in Indian states, forces companies like Dream11 to adapt their strategies. Broadcasting rights also pose issues, exemplified by Brazil's "Pelé Law" fragmenting the market. Sports marketers must invest in local legal expertise, stay flexible in their strategies, and collaborate with local authorities and partners to ensure compliance and capitalize on opportunities.

When starting to compete in a new emerging market, it's important to remember your competitors may not be the same ones you're used to. Find out who is also operating in your market, how they're doing (as much as you can), and how the market feels about them. Take this into consideration as you launch - you don't want to be the same thing, just new or from somewhere else, that's not a sustainable advantage.

The Indian Premier League revolutionized cricket marketing by blending entertainment and celebrity culture with short-format cricket, reaching a $6.2 billion valuation in 2022. Innovation often leverages technology for fan engagement. The NBA's partnership with Alibaba in China created a unique digital ecosystem, including live game streaming, NBA-themed online games, and personalized shopping experiences, making the NBA highly popular with over 200 million social media followers in China. Creating localized content is another key strategy. Manchester United's MUTV app offers tailored content in multiple languages, helping maintain its position as one of the most valuable sports brands globally, with a $1.45 billion brand value in 2022.

Competition in emerging markets is not as structured and dense as in mature markets. As a result, it's tempting for companies not to be that innovative since you don't need to stand out of the crowd (or at least less than in mature markets). Competition always fosters innovation !

In emerging markets, sports presents a huge opportunity for social impact. Often those who want to make a career out of playing a sport don't have access to opportunities and equipment. Through integrating community-focused initiatives, like Nike’s support for local sports program, these challenges can be addressed, building a brand’s reputation for social responsibility. This approach, I’ve found, meets the community's needs and aligns with the brand’s aim. But there is a challenge that lies here in aligning brand goals with genuine community needs without appearing exploitative. In my mind, that happens when the brand seeks niches and caters to them over a longer period of time than trying to scale over multiple sports/ too many programs.

Sports marketing in emerging markets offers a unique opportunity to create positive social change while building brand loyalty. A prime example is Nike's "Girl Effect" campaign in India, which aimed to empower young girls through sports participation. This initiative not only addressed gender inequality but also expanded Nike's market presence, resulting in a 20% increase in women's product sales in the region. Research by Deloitte shows that 55% of millennials in emerging markets are more likely to buy from brands that support social causes. This trend is exemplified by the success of the "Kick It Out" anti-racism campaign in Brazilian football, which has garnered widespread support and improved the sport's image.

In emerging markets, sports marketers are using technology to boost fan engagement and loyalty. The NBA's partnership with Tencent in China provides personalized content and virtual reality experiences, resulting in 490 million viewers in the 2019-2020 season. McKinsey reports that personalized marketing can boost ROI five to eight times and increase sales by 10%. The Indian Premier League (IPL) uses data analytics to tailor experiences, such as the "Fan Park" initiative, reaching over 20 million new fans. Gamification is also effective. Liga MX's fantasy football app in Mexico increased match viewership by 30% with over 1 million active users. These strategies turn casual viewers into loyal fans, driving growth for sports brands.

Emerging markets often rime with emerging sponsorship programs. Which means they represent a huge opportunity for first movers in terms of sponsorship. Being there to support a specific sports / event at it's very beginning, when the whole middle-class is being built is a massive asset in the long run !

I consulted on game presentation during the launch of Major League Rugby. While the US is not an emerging market, rugby is a relatively new sport to a majority of Americans. We knew we would draw avid fans, but to introduce casual supporters we doubled-down on education in-game, going as far as having the PA announcer do a "commentary-style" approach, explaining the game (rules, points, etc.) in real-time as it unfolded. This added to the existing culture of rugby already featured on the plaza and concourses (including meat pies, specially-brewed lager, etc.).

Often your own unconscious bias, and assumptions that attitudes and behaviours in emerging markets are akin to your own, can present a challenge when marketing to new audiences. Using the incorrect marketing channels to reach audiences has been a common mistake by sports marketers. For example, when China first became a priority market many didn't understand the importance of Weibo as a platform. More recently, in the world of esports and gaming, Discord wasn't known about nor understood and lots of campaigns were focused on Facebook and Instagram when the communities were elsewhere.

Emerging sports markets are a hotbed - passionate new fans, booming mobile use, and room for brand growth. Navigating them requires a multi-channel approach, data for strategy shifts, and sometimes creativity with limited resources. The good news is that social media savvy fans are really heroes for brand building. The challenge - Staying reactive in a fast-changing game. We've seen VR/AR, new platforms, and the transformation events, especially since things shifted in 2020. Embrace data, agility, and long-term partnerships, but IMO the most important thing to make sure you win in this ever-evolving landscape is adaptability