caytoo’s 2023 sponsorship predictions looks at where we are, trends we’ll see and key brand sectors for rights holders to target.

Before we consider what lies ahead, it’s worth looking at what happened in 2022. After almost two years of pandemic upheaval and adapting to new ways of working, including delivering sponsorship campaigns, the world lurched into what looks likely to be a protracted war in Ukraine. Arguably the ramifications were more serious for the global economy, driven by long term disruption of global energy and food supplies.

A year which started in lockdown for many, but with the expectation that the pandemic would move into a new phase, quickly moved to new uncertainty fuelled by war and political uncertainty. Despite that, most economies saw something of a post-Covid bounce back, but the year ended with most lockdown winners, including a lot of tech stocks, in negative territory for the year, with an expectation that the world would return to some sense of ‘normality.’

The sponsorship market grew back with very strong demand for live sport and entertainment while optimism was generally strong until the cost-of-living crisis lurched into full view as we headed into the Autumn. The year ended with as much uncertainty as it had started with.

2023 macro-economic trends

Looking forwards, the major trends which will define 2023 are already pretty clear. Most commentators see no end in sight to war in Ukraine so Europe will need to continue to diversify its energy and food sources which will continue to drive inflation.

The squeeze on household finances driven by inflation and amplified by a housing market slump will ultimately hit the markets. This will lead to recession in Europe, which is predicted to be longer and deeper in the UK than in any other western economy. Some commentators say that the recessionary impact on the UK in 2023 will be worse than anything we saw during the pandemic. The lingering effects of Brexit will compound issues in some sectors including manufacturing and the import / export market.

Inflation fears led to a serious downturn in technology stocks as the NASDAQ fell 70% in 2022. This may not be over as inflation undermines heady tech valuations which are heavily skewed towards future earnings. Technology investment in sponsorship – which was largely driven by those valuations and associated fundraising – is likely to fall in line.

One lingering concern as we go to press is a renewed fear around Covid driven by China’s sudden unlocking just as the rest of the world is emerging from the pandemic. The potential for further supply chain disruption or the emergence of a new, damaging variant is all too clear.

Click here to request our full 2023 sponsorship predictions report containing our top five target brand picks in each of the categories we have identified.

Sponsorship predictions 2023 – challenges

There are clearly some categories which might become challenging to prospect – such as banking (especially mortgage lenders), commercial and residential property, and mid-market retail (recessions tend to benefit discount retailers while the luxury market is dependent on other factors).

Whilst former Barclays CEO and financial commentator Bob Diamond believes that digital currencies will be an important component in the future finance landscape, 2022 was a turbulent year in crypto markets and a number of high-profile rights holders are now spending time and money extricating themselves from expensive deals.

Sponsorship predictions 2023 – targets

More interestingly, and positively, we believe there are some categories worth watching and targeting.

• Travel is one sector which is expected to rebound strongly in 2023 as households prioritise great escapes after two years in and out of lockdown. Airline shares are up around 20% on average already this year and 7th January was billed as ‘super Saturday’ for holiday bookings. So, think tourism boards, airlines, tour operators, cruise lines. Combined with COP28 in the UAE, watch out for an ongoing, post-World Cup promotion of the Middle East.
• The Tesla Y was the 3rd biggest selling car in the UK in 2022 as momentum built in the EV car market driven by pocket, conscience, future-proofing and rapidly increasing choice. All major car manufacturers now have aggressive EV roadmaps and will need aggressive marketing strategies to ensure they take their share of the market.
• As brands rush to build their sustainability credentials in the face of an increasingly questioning and demanding consumer, watch out for rapid growth in green energy and finance. We’re already seeing a big uptick in recruitment in these sectors.
• Cybersecurity is one technology area which will continue to see increased investment as more businesses and individuals look for greater protection in uncertain times. This is being exacerbated by the rise of remote and hybrid working engendered by the Covid pandemic.

Sponsorship trends

• Women’s sport is clearly on a big upward trajectory and 2023 will see that accelerate with the women’s FIFA World Cup in Australia and New Zealand. Watch out for female-facing consumer brands jumping on that trend.
• Similarly, every brand large enough to do so is shouting loud about their ESG strategy – and will want to bolster their credentials with some action – so if rights holders have a good sustainability story, they could be very attractive.
• Other trends will include continued investment in digital assets, including NFTs, and the rise of the metaverse.
• We’re always looking for buying signals – expansion and M&A were the biggest buying signals in 2022 according to caytoo analysis. Given the economic backdrop, that is unlikely to be replicated in 2023 with less M&A and new launch activity likely.
• Finally, we are already seeing continued investment by Sovereign wealth funds in sporting and entertainment assets – LIV Golf being a prime example.

How to improve your chances of success

So what will the big buying signals be in 2023? And what can you do to improve your chances of success?

• Sign up to caytoo to get the benefit of regular research reports like this one, plus access to our data and analysts.
• Contact caytoo here if you want to learn more about how we help rights holders connect with brands.
• Think ahead and play the long game. Build relationships today for next year or the year after. “Not now” does not mean “never”.
• View our top five target brand picks in each of the categories we have identified in our full 2023 sponsorship predictions report.