The global demand for sports sponsorships is expected to reach $89.60 billion a year by 2027, which would represent a compound annual growth rate (CAGR) of 6.7 percent from $57.00 billion in 2020, according to a new report by Brandessence Market Research and Consulting.

Despite the impact of the coronavirus pandemic, the study suggests that the sports sponsorship market “is booming,” driven by digitalization as well as the opportunity for brands to run storytelling and content marketing at a time when people are overloaded with advertising and information.

The increasing number of new sports events around the world is also regarded as a major driver for the sports sponsorship market, since these events attract people and audiences, and thus sponsors as well. The specificities of sport itself further contribute to make sports sponsorship attractive, according to the agency. These include the possibility for sponsors to target specific market segments, to increase brand recognition, and to build relationships with consumers around an athlete or team, which potentially means associating a brand to a winning group or indiviual.

In terms of segments, the sports sponsorship market was dominated in 2020 by football, which accounted for 36.05 percent of the market, followed by basketball at 17.84 percent. By geographical region, North America held the largest share, with 34.57 percent of the market. For every single U.S. dollar spent in sponsorships worldwide, around 37 cents come from the American and Canadian markets, the report indicates. On the other hand, the Asia-Pacific region is expected to be a promising market, growing at a CAGR of 6.65 percent by 2027, driven by the rise of mobile and digital penetration, combined with the proliferation of general entertainment content, among other factors.

The relatively recent emergence of digital and social media has been pushing all kinds of brands to look for promotion not only on TV but also via the new media, and this trend is “growing explosively,” the analysts said, creating new opportunities for the sports sponsorship market to continue to expand. The full report is available for purchase from Brandessence.